The “Other” Grantmakers Donor Advised Funds and Supporting Organizations Planned Giving Group of New England April 28, 2017 Wendy Chou The Oregon Community Foundation Outline • Why gift planners should care about DAFs and SOs • Legal definitions and vocabulary • Case studies • Questions www.oregoncf.org Grants from DAFs to Nonprofits* Total Charitable Funds Raised Total Assets Held in from Individuals in 2015: DAFs in 2015: $265 billion $78.6 billion $14.52 billion $22.26 billion in grants to contributed Nonprofits to DAFs * Data from National Philanthropic Trust’s 2016 Donor-Advised Fund Report. www.oregoncf.org Grantmaking From DAFs* Billions Grant Dollars to Nonprofits 2011-2015 16 14 14.52 12 12.42 10 9.91 8 8.55 8.14 6 4 2 0 2011 2012 2013 2014 2015 * Data from National Philanthropic Trust’s 2016 Donor-Advised Fund Report www.oregoncf.org Grants from Supporting Organizations 57,000 $76 Supporting Organizations = BILLION in the U.S. IN TOTAL ASSETS www.oregoncf.org Our Donors www.oregoncf.org Donor Advised Fund: A Relationship www.oregoncf.org The Ewing Donor Advised Fund of The Dallas Community Foundation • I advise a grant to the Dallas Hospital • Fund Sponsor approves or not • Fund Sponsor makes a grant to Dallas Hospital www.oregoncf.org Why do donors give to DAFs? It is...... www.oregoncf.org Rumor DAFs and Supporting Organizations are vampires of the charitable world and suck away money that would otherwise be going to operating charities. www.oregoncf.org Scenario #1 Ewing Oil Had a High Income Year Corporate Ewing DAF at Stock The Dallas Community Foundation www.oregoncf.org a. Swear profusely and spit in the eye of Dallas Community Foundation. b. Continue cultivating the Ewings. c. All of the above. www.oregoncf.org Scenario #2 JR will require DCF to make a grant to Dallas Hospital. www.oregoncf.org Donor Control www.oregoncf.org Scenario #3 What Not to Do With DAFs ZtÄtV{|v~xÇ W|ÇÇxÜá Pledges AND www.oregoncf.org www.oregoncf.org www.oregoncf.org Scenario #4 Football Fever • Bobby recommends large grants from his DAF to the football program at Texas A&M. • Texas A&M wants to give Bobby “preference points.” • Permissible? www.oregoncf.org Supporting Organization www.oregoncf.org Supporting Organizations Supported Organization Board Funds Services Infrastructure Mission Supporting Organization Board www.oregoncf.org Spectrum of Control Supporting Organizations Donor Private Advised Foundations Funds Least Most www.oregoncf.org Why do donors form SOs? www.oregoncf.org Gift of Complex Asset Closely held stock in biotech synthetic oil ??! company www.oregoncf.org Supporting Organization Technical Points Can I control the board of my supporting organization? Can the supporting organization pay my wife a salary? It’s not like I have to attend board meetings, right? www.oregoncf.org Scenario #5 James Beaumont, J.R.’s son, who was born out of wedlock, applies to work for the Southfork SO as a program officer. www.oregoncf.org www.oregoncf.org www.oregoncf.org Scenario #6 We’re Following the Rules, But… • JR and Bobby are on the board of the SO • DCF names three directors: – CFO – VP of Gift Planning – Employee of Ewing Oil www.oregoncf.org Questions? www.oregoncf.org Thank you! Wendy Chou The Oregon Community Foundation [email protected] www.oregoncf.org.