A community foundation is a nonprofit, public charity created by and for the residents of a specific geographic are or for a specific purpose of interest.
Community foundations exist to guide local donors with charitable giving, assist the non-profit community and take a leadership role in responding to regional needs. Community foundations were first introduced in 1914 in Cleveland, Ohio and were created to enable anyone to become a philanthropist. Today, there are over 750 community foundations in the United States, although not all are accredited, as the Community Foundation of Fayette County (CFFC) is. Holding the honor of accreditation, through the Council on Foundations, indicates that the CFFC follows and adheres to the strictest standards and practices as set forth by the Council and the IRS. The CFFC was first accredited in 2009 and re-accredited in 2014.
A community foundation offers very flexible donor giving options and the concept is based on the economy of scale that “pooled” funds can offer a greater return than if invested alone. Charitable “Funds” are the backbone of the community foundation concept, wherein individuals or groups can create “Funds” and from these Funds, recommend financial grant awards to the charities of their choice or for scholarships to deserving students. Organizations can create “Agency Funds” to guarantee sustainability. A variety of Fund types exist for flexible giving.
All contributions and gifts to the Foundation are tax deductible to the extent allowed by law. Donors that create Funds, pay no excise taxes, as can be the case with creating a private foundation, and community foundations have no set spending requirements, as private foundations do.
Community foundations cover operating expenses by charging administrative fees (1% to 4%) on Funds. The fees partially cover foundation operations, which are managed by a professional staff, with roots in the community and decades of experience in the non-profit sector.
Download CFFC Community Foundation Basics, Baker Tilly Int’l. & ParenteBeard, 2012 (PDF)
As with our counterparts in other communities, the CFFC is led by a volunteer, local Board of Directors. Board Members are not paid, and many have established named Funds in their areas of interest. Their role is to provide governance and oversight of Foundation activities.
Community foundations remain the fastest growing type of philanthropic vehicle in the United State today, and offer flexible, safe giving options and experienced guidance to best serve the community and region.
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