Inside Philanthropy

A blog on philanthropy and nonprofit news and issues. A publication of Philanthropy Journal.

August 13, 2007

Rural philanthropy needed

Struggling with urgent social problems, rural America lives on the wrong side of the philanthropic tracks, with U.S. grantmakers targeting almost all their funds to urban America.

Roughly one in five Americans lives in a rural area – regions with less than 500 people per square mile – but fewer than one in 100 U.S. grantmaking foundations allocated money for rural development between 2001 and 2002, according to a 2004 report by the National Committee for Responsive Philanthropy.

In a new report, NCRP notes that a separate study by the Southern Rural Development Initiative in 2004 found rural foundations’ assets represented only 3 percent of all U.S. foundations’ assets and were concentrated in a sliver of non-metro counties.

NCRP also notes the Big Sky Institute for the Advancement of Nonprofits found the 10 states with the fewest foundation assets, and those receiving some of the fewest grant dollars per capita, were mostly rural, while the states with the most foundation assets, and those receiving some of the most grant dollars per capita in 2006, were largely urban.

In its new report, NCRP calls on funders to help plug rural America’s philanthropic gap.

Based on focus groups and interviews with nonprofit directors and rural foundation leaders, the report says grantmaking in the U.S. is heavily skewed to programs based in or focused on urban areas.

Urban foundations provide little rural funding either because they are not aware of rural needs or believe those needs outstrip their ability to make an impact with their funds, the report says.

Foundations prefer densely-populated urban areas because their funds can have the greatest impact there, the report says.

Funders also see limits in the effectiveness and sustainability of rural nonprofits because they lack organizational capacity and savvy.

And while foundations believe nonprofits should build relationships with them to secure funding, rural nonprofits lack access to big foundations and to the kind of support systems urban nonprofits enjoy, the report says.

To overcome the gap in rural giving, the report offers a series recommendations, calling on funders, for example, to provide long-term operating support and technical-assistance funding; create metrics appropriate to measuring the impact of grants to rural areas; fund “intermediaries” that can direct dollars to rural groups and help build their “capacity” when the funders themselves lack the staff and expertise to meet rural nonprofits’ needs; create funding collaboratives to get more “flexible” funding to rural areas; and work to build rural endowments.

As North Carolina think-tank MDC Inc. made clear in a study earlier this year on philanthropy in the South, strategic philanthropic investment in underserved regions is critical because, in an increasingly competitive global economy, Americans all sink or swim together.

To help America thrive, foundations need to spread their wealth, making investments that will help tap and develop the assets of rural America and help make the American dream a reality for all Americans.


  • At 8:23 AM, Anonymous Anonymous said…

    Setting aside issues of directed donor intent, the lack of rural philanthropy is supported by the fact that so few people in the field come from rural backgrounds or care to understand complex rural delivery systems that defy easy solutions. Unfortunately, some of the phianthropic work that has gone to rural areas has done a disservice to those communities by supporting false leaders who easily sway the big city sophisticates from the foundations -- who are taken in by the tales of woe of these poor country people being represented by charlatans and opportunists. Effective rural philantrhropy is very difficult and not for those wanting to claim easy victories.

  • At 3:20 PM, Anonymous Alan McGregor said…

    The NCRP report about rural philanthropy is a great contribution to the field. Last week's conference on philanthropy and rural communities sponsored by the Council on Foundations is another sign of philanthropy's growing attention to rural. It's about time. But this is not simply about directing more grants to rural places. The opportunity is for philanthropy to support rural places to build their own assets. Homegrown philanthropy, rural policy that supports asset-based development, and strong nonprofit infrastructure are critical elements and good targets for philanthropic investment.


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