The COVID-19 pandemic triggered waves of unprecedented challenges across the globe. In many communities, these challenges also prompted action, as individuals, families, and companies stepped up to help others any way they could—offering anything from financial support and childcare to advocacy and expertise.
This groundswell of generosity has also been visible at community foundations, where grantmaking from Donor Advised Funds (DAFs) has increased significantly—especially during the early months of the pandemic. At The Columbus Foundation, funding distributed through DAF grants between March and May 2020 totaled nearly $41 million—a 62 percent increase compared to the same period in 2019. By the end of 2020, grantmaking from DAFs at The Columbus Foundation totaled $151,796,439, an increase of 30 percent from the 2019 fiscal year.
This surge in grantmaking was not unique to central Ohio. According to a recent study by the Community Foundation Public Awareness Initiative, community foundations across the United States experienced a sizeable increase in grantmaking from DAFs during the pandemic. Total DAF grantmaking from the 84 community foundations that reported was more than $6.7 billion in 2020. That's up nearly $2 billion compared to 2019—an increase of 41 percent.
The pandemic is not the first time that DAF assets were mobilized on a large scale to address crises. Major disruptive events, including 9/11 and the Great Recession, also triggered a surge. In the face of crises, DAF grantmaking not only remains stable, but increases. The pattern illustrates the power of DAFs as a tool for providing critical support and stability to nonprofits and the communities they serve during times of economic downturn.
This trend was also captured in a 2019 study by Dan Heist of the University of Pennsylvania and Danielle Vance-McMullen of the University of Memphis, which found that donors who manage DAFs tend to be more generous with their grantmaking during recessions, especially when compared with other forms of giving. The study found that the rate of grantmaking from DAFs tends to be resilient during economic recessions, making DAFs crucial "rainy-day" funding sources for charities during economic downturns.
This increased rate of grantmaking is especially promising when accounting for the fact that DAFs already granted assets at a rate significantly higher than private foundations before the pandemic. According to the National Philanthropic Trust’s 2019 DAF Report, DAFs at community foundations granted out 15 to 20 percent of assets annually between 2014 and 2018—much more than the minimum payout rate for private foundations of 5 percent.
Though the proverbial storm is likely far from over, come what may, the Foundation remains committed to serving as a point of access for those who want to assist others. Contact us if you are interested in learning more about the Foundation’s services and how we can help your clients make a difference, now and into the future.
About The Columbus Foundation
The Columbus Foundation serves nearly 3,000 individuals, families, and businesses that have created unique funds and planned gifts to make a difference in the lives of others through the most effective philanthropy possible. The Columbus Foundation is Your Trusted Philanthropic Advisor® and is one of the top ten largest community foundations in the country.