Community foundations were first formed in the United States in 1914. They are tax-exempt public charities, established by local individuals to meet local needs. Community foundations strive to build and strengthen communities by making it possible for a wide range of donors to create permanent charitable funds to meet critical needs. Community foundations are one of the fastest growing sectors of philanthropy in the United States today with over 800 community foundations located in almost every region and state in the United States. These foundations jointly hold assets valued at more than $31.5 billion. The idea of community foundations is spreading throughout the world as well, with a number approaching 2000 worldwide.
Community foundations, through philanthropy that is focused on the growth and stewardship of permanent charitable resources, have become catalysts for improvement in every kind of community, from urban to rural. They support a wide range of nonprofit organizations in a variety of areas including social services, arts, education, environmental projects and health. In addition, community foundations often evaluate and help coordinate the needs and services in its community, so that charitable gifts are used effectively to fulfill a community’s most critical needs. All share a common goal of serving donors, nonprofit organizations and their communities.
Community foundations offer donors many services and benefits. They work with families, individuals, estate planners, and attorneys to design gift plans that fit every economic situation so donors can receive the most benefit from their charitable contributions. Donors can give to an existing fund or establish a charitable donor advised or endowment fund by contributing a variety of assets. Community foundations throughout the United States invest in diverse portfolios and manage their assets carefully. Investments are generally managed to provide a stream of income from which donations and annual grants are made as well as to protect the principal of investments against inflation. In this way, gifts given through foundations will continue to grow and earn resources for their communities.