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From the Funder’s Perspective: An Interview with Rob Collier
 By Brandon Seng
Michigan Nonprofit Association
The Michigan Nonprofit Association offers several opportunities for members to network with grantmaking institutions and funders. MNA members use these opportunities to discuss trends in funding and make valuable connections that will help them advance their missions. Through MNA’s blog, we have recently asked members to submit questions that they would like the foundation community to respond to. The following is an excerpt from an interview with Rob Collier, President and CEO of the Council of Michigan Foundations, in which some of those questions were addressed.
MNA: A key component in obtaining funding is relationship building. How have funding community and grantseeker relationships worked well in Michigan? What have been the biggest challenges?
RC: Relationships continue to be vitally important, particularly when organizations have received funds from donors in the past and want to maintain the relationship. One of the challenges here is that nonprofit organizations don’t always keep donors or funders informed about the good stuff that they are doing. If someone has given to your cause, it is important to let them know how their contributions are being used, which in turn helps strengthen those relationships.
Nonprofits need to figure out what is the best way of keeping donors informed while avoiding overwhelming them with too much information. A lot of donors are using the web, which could offer new opportunities to keep donors in the loop. By communicating strategically organizations can identify donors who are willing to talk about the work their nonprofit is doing. These donors are often willing to host activities for potential new donors, and can act as ambassadors for the cause as well.
MNA: Michigan has a rich history in philanthropic giving. What does this mean in terms of opportunity that might exist here and not in other places?
RC: We have over 2,200 foundations in Michigan, and a long tradition of philanthropic giving. The majority of these are small unstaffed family foundations, but we also have three of the largest foundations in the world: Kellogg, Mott and Kresge. The good news is, in spite of this economic market people are still creating foundations, family foundations in particular, and we still see donor advised funds being created at community foundations. An intergenerational transfer of wealth is underway, and that tradition of giving back to communities is continuing.
While we have this large number of foundations, it is important to point out that organized philanthropy is still very small when compared to individual giving, which remains the largest form of philanthropy. It is one thing to get support from foundations, but what stakeholders are most interested in is if you’re getting support from your members, your board and individuals.
One of the most significant opportunities for individual giving that has been renewed by congress is the extension of the IRA charitable rollover. There are individuals who are required to take the distributions from their IRA that are taxable because they are seventy and one half years of age. They may not necessarily need those distributions, and now can donate them tax free to their favorite charity, up to 100,000 per year this year and next year. In spite of the downturn in the market, there is still an incredible amount of wealth that has been put aside in IRAs; that is a very important opportunity that nonprofits don’t want to overlook.
MNA: To continue with the economy, how are current economic challenges and the stock market affecting endowed funds?
RC: I think the thing that everyone must understand is that the goal of an endowment is that it grows every year, and a certain percentage of the growth is what is used for charitable giving. When an endowment goes below the original principle value, it obviously causes a restriction in the resources available for charitable giving. The challenge for the foundation community is going to be how they will continue to make grants recognizing that the market has been down this year. The good news is that foundations average their grants over a five year period, so we are not going to see foundations stop making grants completely, but we will probably see a slight reduction in grantmaking. As a result, foundations will concentrate on organizations they currently support. I don’t know that we’re going to see them opening up their doors to folks they haven’t been supporting, but will continue the relationships that currently exist.
MNA: Our members are stressing the need for funding for general operations. MNA recognizes that there are two sides to this issue- on one hand an increase in constituent need, and on the other an increase in the number of nonprofits serving those needs. What are some strategies for a nonprofit to address this issue, and access dollars for operational based needs?
RC: I do think that foundations are concerned about finding the most effective ways of helping nonprofits; this was a topic at our annual conference. There is definitely an interest in what do we do to help nonprofits sustain their programming, and definitely on the radar screen for many foundations. For nonprofits, the issue becomes how do we do a better job of explaining our core needs. The fact is that, in order to keep open the doors, this is what we have to do. How do we challenge past donors to match foundation support to meet those core needs?
MNA: Many of our college and university members have reported seeing an increase in funding for education, particularly around the issues of access and success. What might be a few reasons for this trend, and can they expect similar support for programming around these areas in the future?
RC: Clearly foundations recognize the value in supporting education. That continues to be a high priority for foundations. They are looking at the role of education in terms of economic prosperity and transforming Michigan for the 21st century knowledge economy that has been well documented, and I think foundations are responding to that. What is the future to bring? I think we’re going to see strong support for education, but you and I can’t read the tea leaves as to what will happen next.
MNA: Michigan will be witnessing a large amount of turnover in our elected officials in the next two election cycles due to term limits. What will be the role of foundations and nonprofits in this process?
RC: Through CMF, Michigan’s foundation community does have a long track record going back 25 + years partnering with state government on initiatives. We have a long term public-private partnership in Michigan and as a result foundations look for strategic ways in which they can assist the state in addressing critical issues affecting our futures.
Term limits have certainly had an impact on the nonprofit sector and philanthropy. One of the responses has been how do we do a better job of making sure state government understands what philanthropy and the nonprofit sector bring to the state. As a result we see MNA’s annual Nonprofit Day as a critical education experience, where the number of legislators and staffers attending continues to grow. CMF is also working closely with MNA in collecting and using data to inform the legislature about the value that the nonprofit sector and philanthropy bring to our state. CMF invites residents in Michigan to take part in these discussions of where we want the state to go, and how we ensure that government reform is part of that agenda.
Rob Collier is an MNA board member and the President and CEO of the Council of Michigan Foundations, a MNA member since 1997. For more information about CMF visit www.michiganfoundations.org.
*Article provided by the Michigan Nonprofit Association
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