Promising Aid to Arts Organizations, Five Charitable Foundations Will Give an Unprecedented $1.7 Billion to Nonprofits Worldwide

In a bold joint effort, five major US charitable foundations
have come together to pledge more than $1.7 billion to support
nonprofits around the world that have been battered by the looming
financial crisis.

The Ford Foundation, which is leading the initiative, has
promised $1 billion for the endeavor, and is joined by the W.K.
Kellogg Foundation (which is pledging $300 million); the
Andrew W. Mellon Foundation ($200 million); the John D. &
Catherine T. MacArthur Foundation ($125 million); and
the Doris Duke Charitable Foundation ($100 million).

“This is a story of something that doesn’t happen enough in
philanthropy: collaboration,” Ford Foundation president Darren
Walker said in a press call announcing the initiative. “I
don’t think there’s been a greater day for American philanthropy
than today.”

The Ford Foundation has also made the exceedingly rare decision
to raise its $1 billion by selling 30- and 50-year bonds. (The
organization also plans to separately give $550 million in grants
it was already planning to distribute this year.) The
MacArthur and Doris Duke foundations also plan to issue bonds.

Debt financing, which is common practice in for-profit sectors,
is unusual in philanthropy, but the foundations say that
unprecedented times call for unprecedented measures. The
organizations are looking to take advantage of low interest rates,
which also allows them to spend more money without digging more
deeply into their endowments.

The five organizations will individually handle the distribution
of funds according to their own grant-making guidelines and
priorities, and hope that their bold initiative will inspire others
to act similarly.

“We hope other foundations will join us in creating a different
model where foundations step up more, not less, in the times of
greatest need,” MacArthur president John Palfrey said. (At
least two organizations that were approached to join the effort,
the Carnegie Corporation and the Rockefeller Brothers
Fund, declined to participate, according to the New York Times.)

The effort comes at a crucial time for nonprofits around the
world, which are struggling under the weight of closures, staff
reductions, and damaged investments. Many arts organizations
have only two months of cash reserves, and cultural institutions
are on track to lose a total of $6.8
billion this year. Even more dire, the American Alliance of
Museums predicts that up to 30 percent of American museums could
close permanently.

“The partnership that we’re announcing today happened with
unprecedented speed and unprecedented scale,” Mellon president
Elizabeth Alexander said. “Many organizations don’t have any kind
of endowment at all. Addressing that issue of longevity is a
longterm structural challenge. But one of the things that’s
extraordinary that we see in the arts sector is an unparalleled
resilience.”

The post Promising Aid to Arts Organizations, Five
Charitable Foundations Will Give an Unprecedented $1.7 Billion to
Nonprofits Worldwide appeared first on artnet News.