News Column

Building the Foundation

May 2007, HISPANIC BUSINESS Magazine

Hildy Medina

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When a group of Hispanic leaders set out to create an endowment that would provide funding for Hispanic nonprofits, skeptics called it a waste of time.

"They told us it wasn't going to work," recalls Henry Lacayo, chairman and co-founder of the Destino Hispanic Legacy Fund. "They said, 'You have to raise all the money and you have to give it out,' and I said, 'Well, we can do both.'"

To date, the Destino Hispanic Legacy Fund has grown from a $100,000 endowment to nearly $1 million. The Ventura, California-based fund has given annual grants totaling nearly $648,000 to 39 Hispanic nonprofits since it began in 1996.

They're not alone. In recent years, the goal among Hispanic leaders is to increase philanthropy among Hispanics for Hispanics by establishing funds, such as Destino, as well as getting more minorities on foundation boards.

"We want to educate Latinos to become philanthropists," says Mr. Lacayo, a longtime activist. "A lot of us are, but don't realize it. It doesn't mean you just have to write a check; it has to do with giving of your time and effort and whatever else you can bring to the table."

The movement is fueled by the rise in Hispanic income and a lack of institutional dollars going to minority nonprofits, say philanthropy professionals. According to the Foundation Center Yearbook, less than 2 percent of foundation giving was designated to Hispanic nonprofits in 2004.

"We think of philanthropy in terms of institutions and tax exemptions, which are very important in terms of business, but at the heart of philanthropy is giving," says Diana Campoamor, president of Hispanics in Philanthropy, a 2007 recipient of the W.K. Kellogg Foundation's "National Leadership in Action Award."

Helping others is something Hispanics, like many other ethnic groups, have been doing forever – it just doesn't look like traditional charitable giving. First-generation Hispanics give millions in relief efforts when disaster strikes in their native land, for example, and all generations raise money for their neighborhood churches.

"There's a lot of room to tap into [Hispanic] money in this country, even among the most humble of families, to begin to be oriented to giving in this country," says Henry A. J. Ramos, president of Mauer Kunst Consulting, a New York firm that advises nonprofit groups in Hispanic giving,

How that spirit of giving translates into dollars for Hispanic service agencies is difficult to determine. Outside of anecdotes, there is little data available that detail how much money Hispanics donate to minority service providers.

Not all charitable funding, however, can be traced to a specific ethnic group. Many foundations or quasi-governmental organizations that help fund nonprofit agencies serving diverse populations do not break down their donations by ethnicity.

For example, in 2002, South Florida voters passed a special taxing district – The Children's Trust – that would help fund nonprofit providers who serve children and families in Miami-Dade County, where more than 60 percent of the region's 2.3 million residents are Hispanic.

"The services that we're providing are very reflective of the community in which we live," says trust CEO and President Modesto Abety. "We, of course, have targeted services to inner-city programs where Latino and African-American children benefit, but we also have a vast number of programs that benefit all races."

Most nonprofits, of course, don't have the guaranteed revenue stream of The Children's Trust. To help narrow the funding gap, the Hispanic Federation established the National Latino Funds Alliance, formerly known as the Latino Funds Collaborative, to encourage communities nationwide to start their own Hispanic endowments.

Funds such as Chicago's Nuestro Futoro, St. Paul, Minnesota's El Fondo de Nuestra Comunidad, and the Greater Kansas City Hispanic Community Fund have helped pave the way, but more work still needs to be done, notes Hispanic Federation President Lillian Rodriguez-Lopez.

"The wealth is absolutely growing but we're not quite there yet," says Rodriguez-Lopez, whose nonprofit ranks 21st on our list. "As a community we're untapped in terms of our giving. It hasn't exploded yet, but it will in 10 years."

In 1997, Latinos in Development (LID) was created to bring together a small but growing group of Hispanic philanthropy professionals to get more bang for the buck in their fundraising efforts. It was only recently, however, that LID created its first board of directors to oversee a membership of 42 professionals who collectively help raise more than $50 million for Hispanic and other causes in the Chicago area.

LID also established an award to honor Hispanic individuals who have donated their time and money to charitable causes. "For the Latinos who attend these awards, we're hoping they'll say, 'I want to get this award one day,'" says Nancy J. Garza, LID's vice-president of marketing. "Hopefully, they will want to continue the process."

But philanthropy experts say that it will not be easy to persuade Hispanic givers to devote less money to their churches and family abroad and more to traditional nonprofits, such as domestic violence shelters or after-school programs.

"Latinos have always been giving; we build churches, we give to our families, but we've never been mainstream philanthropic," says Elsa Vega-Perez, senior program officer at the Otto Bremer Foundation in St. Paul, Minnesota. "That's the twist; we have to become more familiar with those processes and then we have to make them bilingual and culturally specific because people don't know about the issues in our community the way we do."

Some of the country's most influential Hispanics have been answering the call to give back to Hispanics. In 1998, Henry Cisneros and Raul Yzaguirre created the New America Alliance to wrangle donations from the country's wealthiest Hispanics and funnel them to Hispanic causes.

Many Hispanic professionals have incorporated philanthropy into their lives, but often their donations are steered toward their former universities or major museums.

"They're able to attract business that way," Mr. Ramos says. "What's interesting is – like many of us who are straddling the world of the powerful white elite and the barrios where we come from – they're torn. They want to give to grassroots organizations that represent their experience, but they're expected to give to more mainstream groups.

"Although their giving is extremely generous, it's a reactive kind of giving. What we're trying to do is to develop a culture of giving that is more driven to building institutions, to building movements, to give us the strategic leverage point for advancing our interests and our contributions to American society."



Source: HISPANIC BUSINESS Magazine and Hispanicbusiness.com, Copyright (c) 2007 All Rights Reserved.


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