HispanicBusiness

In response to a controversial bill that would have exposed the lack of investment in minority organizations, ten of California's largest foundations recently proposed a multimillion-dollar, multiyear investment in the minority community. Assemblyman Joe Coto (D-23rd District), who authored the legislation, was pleased by the proposal and followed the announcement by dropping his bill.

Hispanic Business magazine, which has been tracking the top 25 Hispanic nonprofits since 2000, reported in May that less than 1.2 percent of grants by foundations that assist minorities go to Hispanic nonprofits.

"Even though foundations know that the greatest amount of need exists within our community, their boards had other priorities," Mr. Coto said. "Now they have to redirect their priorities."

With this redirection, the foundations' focus will initially be in five areas in the Hispanic community: youth development, economic empowerment, healthy lifestyles, civic engagement and environmental justice.

Mr. Coto said the proposal has been well received. "The Hispanic community is very excited about the fact that we've been able to get the foundations to collaborate with us," he said. "These ten major foundations have made a high-level commitment. We'll have regular meetings with them to track their progress and they are going to work hard to get other foundations to participate."

Hispanic lawmakers and nonprofit organization leaders who talked to Hispanic Business magazine supported the deal. Senate Majority Leader Gloria Romero (D-24th District), sees the proposal as an indicator of the changing face of California.

"The outcome we received was an absolute victory," said Ms. Romero, who is a member of the Latino Legislative Caucus, the largest ethnic legislative caucus in California. "We want to see diversity. We want to see representation. When the minority caucuses work together, we can move capital in California."

Castulo de la Rocha, CEO of AltaMed Health Services Corp., the largest Hispanic nonprofit organization in California, agreed. "This proposal is moving us in the right direction," Mr. de la Rocha said from the organization's headquarters in Los Angeles. "My hope is that it opens access to larger foundations and organizations, and brings additional resources to the community." AltaMed serves more than 48,000 families per year.

Hispanic members of the State Assembly also seemed satisfied with the results. "The proposal gets to the goal of trying to figure out how to better invest the limited resources into a wider group of nonprofits that haven't traditionally received funding," Assemblyman Felipe Fuentes (D-39th District) said. "Globally, it's what we need during this economic downturn."

The bill, AB 624, was drafted because of the difficulty minority organizations face when securing funding. In 2006, the Greenlining Institute released a study that provided much of the impetus for the legislation. That study revealed that foundation investments in the minority community were startlingly low. In 2006, for example, only 3.6 percent of the total grant money awarded went to minority-led organizations. In addition, the research found that the largest foundations in California, including the Hewlett Packard Foundation, and the Gordon & Betty Moore Foundation, rank at the bottom of foundations by dollars invested in minority-led organizations.

"This is a great first step and will prove to be very fruitful, but it's far from over," said Jorge Corralejo, a boardmember of the Greenlining Institute.

The bill would have required large California foundations with more than $250 million in assets, to disclose the racial and gender composition of their staffs and boards, as well as the number of grants allocated to minority organizations. It was met with opposition from some foundation leaders, who saw it as a violation of privacy and feared it would spread nationwide.

After months of talks between foundation leaders, community organizations and the Latino, Black and Asian Pacific Islander legislative caucuses, the Foundation Coalition agreed to strengthen its support of the minority and low-income communities.

The foundations, including the Ahmanson Foundation, the California Endowment, and the William and Flora Hewlett Foundation, agreed to issue annual reports about their efforts. They also said at the close of this year, plans for grant-making activities to minority-led organizations for 2009, will be announced. These are expected to be in the multimillion-dollar range.

Although AltaMed, like other Hispanic-led nonprofit organizations, has received support from such foundations as the California Endowment and the Wellness Foundation, Mr. de la Rocha pointed out that finding funding isn't easy.

"Whenever you work in under-served populations, it's always a challenge," he said.

Mr. Corralejo also acknowledged the lack of funding to Hispanic nonprofits. "Hispanic nonprofits aren't doing as well as they should be doing, they are among the last to be awarded grants," he explained. "It's important that they raise their level of attention to what's occurring and pursue these opportunities that will develop."

Observers believe that the attention given to the needs and chronic under-funding of minority-led nonprofit organizations in California may help shine a spotlight on similar problems nationwide.

Foundations that agreed to the proposal include the Ahmanson Foundation, the James Irvine Foundation, UniHealth Foundation, the Ralph M. Parsons Foundation, the California Endowment, the California Wellness Foundation, the Annenberg Foundation, the William and Flora Hewlett Foundation, the David and Lucile Packard Foundation and the Weingart Foundation.