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Guest view: Donor advised funds aid non-profits

Guest view: Donor advised funds aid non-profits

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Right now, somewhere in Montana, there are two families who may never meet — and yet will profoundly influence each other. Like many people these days, one needs a little extra help to get on their feet and may struggle to get by. The other has been fortunate enough to be able to provide for themselves and their future, and now they are eager to give back.

As the president and CEO of Montana Community Foundation, I have the humbling job of interacting with both of these types of families firsthand. It reminds me that even though many of our neighbors face tough odds, we are also blessed with families who want to help. That’s why I’m proud that our foundation works to create opportunities for charitable giving that enable more families to be a part of making our state a great place to live for all its residents — no matter which town they call home or how much they earn.

Donor advised funds, also called DAFs, are a philanthropic tool used by many different entities, and in organizations like ours, they play a unique role in the community. For example, the Disadvantaged Children’s Fund, established at MCF by Richard (Dick) and Cheri Cox of Billings, has been critical to supporting children’s causes in the Billings area and across the state. Why did they choose a donor advised fund at a community foundation like MCF? The process is relatively simple, letting Dick and Cheri focus on philanthropy instead of administration. DAFs are prudently managed investments, meaning these funds grow over time so Dick and Cheri can continue giving, year after year and, eventually, they can pass the joy of giving through this fund on to their children. Perhaps more than anything, it’s the assistance and expertise Dick and Cheri receive – not only in making the best decisions about what gifts make the most sense for them financially, but also the best way to make grants that have the greatest impact. Dick and Cheri have granted more than $350,000 from their DAF, helping the missions of organizations such as the Intermountain Children’s Home, the Tumbleweed Runaway Program, Camp Mak-A-Dream, Boys & Girls Club of Yellowstone County, and others. This is just one way neighbors are helping neighbors in Montana.

The donor advised funds at MCF allow local residents to set a local agenda for how, where, and what to focus on in advancing the common good. The fact is, during our 30 years of service to Montana, we have built deep expertise in the nonprofit landscape, as well as our communities’ unique needs. DAFs allow potential donors to tap into this expertise so they can rest assured their gifts will achieve the greatest good.

Montana’s nonprofits — and the residents they serve — also benefit from the added flexibility and nimbleness that comes with DAFs. DAFs can be critical when crises hit or unexpected opportunities arise: whether it’s replacing a roof on a church, or responding to a natural disaster. What’s more, DAFs can be actively invested alongside our community endowments, which allows charitable funds to grow over time and respond to immediate and future needs.

For Montana’s many charity-minded residents, DAFs offer a way to establish a tradition of giving they can pass on from one generation to the next, without requiring the financial wherewithal, time, or knowledge necessary to set up a private foundation. In families of more modest means, gifts might start with a few thousand dollars, or a donation of stocks or hard-to-value assets that can nonetheless do a lot of good right in their own community.

Administering funds such as these is a privilege that comes with big responsibilities. That’s why community foundations dedicated to excellence, including MCF, meet the rigorous qualifications of National Standards for U.S. Community Foundations®, which sets strict measures for accountability and transparency in giving. These standards include a “fund activity” requirement specifically designed to ensure resources are distributed promptly and effectively. And once a donor makes their gift, they relinquish control over how the resources are spent — just as they would with any charitable donation. While donors and designated family members can offer advice, final management and oversight stays with the community foundation to ensure resources go where they can do the greatest good.

At the end of the day, Montana’s greatest strength is in its people — and the ways neighbors find to help one another every day. That’s how families from different walks of life can influence each other, even if they never meet. One may benefit from a food pantry with plenty on the shelves this month; another from showing their children the meaning of giving back. Either way, MCF is honored to be here to connect them, now and for years to come.

Mary Rutherford of Helena, MCF president and CEO, has more than 25 years of philanthropic leadership experience and leads Montana Community Foundation in its mission of cultivating a culture of giving so Montana communities can flourish.


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