An example is the Beltline project in Atlanta, a huge redevelopment plan that combines green space, trails, transit and new development along a 22-mile stretch of railroad encircling the city's urban core. The project is expected to cost $2.8 billion over 25 years, and is being funded through a combination of federal, state and local money, along with private philanthropic contributions.
Not all of GenSpring's clients are gung-ho about the environment, but many are. "The environmental movement within philanthropy is definitely a growing trend," Snyder says.
Give Even More
A little green can sometimes spice up traditional philanthropy. "I'd say any nonprofit paying attention to environmental issues is getting an extra look from clients," says Page Snow, senior vice president of foundation services at Foundation Source, a Fairfield, Conn.-based provider of outsourced support services for private foundations. "It adds cachet to even ordinary funding opportunities."
Snow describes one client who was asked to provide a standard capital grant to a local YMCA. The client wasn't interested, but said she'd help build a new children's center at the Y on the condition it be built with environmentally friendly features. The woman personally got involved in choosing the paint, carpet and air ventilation system, as well as the recycled gear for the playground. Ultimately, the woman provided more money to the Y than the original capital request.
"It's a great example of how letting funders do something environmentally friendly can take a traditional grant that might be uninteresting and make it something very enticing," Snow says.
Another way to put large sums of money to work into charitable endeavors is through program-related investments (PRIs). These are a hybrid of investing and philanthropy where foundations can help a particular organization while potentially realizing capital returns. PRI financing methods can include loans, loan guarantees, linked deposits or equity investments in charitable organizations or in commercial ventures for charitable purposes.
One Foundation Source client was interested in a new start-up venture in San Francisco called City CarShare, a nonprofit organization that aims to reduce car ownership and its attendant problems, such as congestion and costs, by providing short-term rentals for as little as $5 an hour, plus 40 cents a mile. Snow said the client liked the concept for environmental and philosophical reasons, but he also saw a business opportunity. The organization needed seed money, so the client's foundation made a PRI where he gave them start-up funding and they paid it back with a low-interest loan. (PRIs aren't intended to be a way for donors to make a financial killing-they must abide by tax laws regarding charitable intent and the relationship to a foundation's program.)
Another charitable tool for foundations is mission-related investing, which is a way to invest money for both social and financial returns. By law, foundations each year must spend 5% of the value of their net investment assets on grant-making for charitable purposes; the other 95% can be invested in various investment options that typically run a wide gamut and don't need to be charity-related.
The goal of mission-related investing is to invest some of the other 95% in for-profit ventures that are aligned with a foundation's overall mission. Snow says one of her clients was a $30 million foundation with a stated goal to invest in environmental causes, and when she first got involved with them it had about 12 board members giving to various environmental causes in their local area.