What is a Community Foundation?
Community foundations (CFs) provide convenient bridges between donors and charities. They act as catalysts for community improvement by working with a wide variety of partners.
The first CF was established in Cleveland, Ohio, in 1914. Today, there are 650 nationwide, and 19 in Washington state, including Whatcom Community Foundation. A CF's primary purpose is to promote and facilitate philanthropy to strengthen and enhance local communities. Anyone wanting to become more involved as a donor, volunteer or grant recipient is well advised to call his or her nearest community foundation. A community foundation is like a clearinghouse: thoroughly familiar with local needs and resources, and able to match those in need with those who can help. CFs also bring a national network of expertise to community philanthropy. A community foundation is a community's foundation. A CF is a permanent philanthropic resource of, by, and for the community. Its essential task is to create and maintain a pool of endowment funds, donated by individuals and institutions. This money is then invested to produce income for charitable grants to benefit the entire community in an ongoing fashion. Community is defined by a specific geographic area and each CF is unique. In addition to fund-raising, money management, and grantmaking, CFs serve as: conveners of individuals, institutions, and resources to solve community problems; researchers to study community issues; and community builders to unite, strengthen, and promote their respective communities. Because CFs are independent and non-partisan, they can effectively (and objectively) address community needs and opportunities.
The IRS protects CFs from misuse (narrow or private-interest focus, for example), by requiring funds to come from a variety of donors, and a CF's governing body to be diverse and representative of the entire community. Besides ensuring that the public will be better served, such close regulation gives donors maximum allowable tax advantages, and makes contribution to new or existing endowments a smooth process (no legal or accounting hurdles).