Will virus curtail charitable giving?
Forever Fund was to be a cornerstone, one day hold maybe $500 million. Now it’s on hold.
No one can quite see what comes next, though it is fair to say once the job market recovers, and people and businesses make money again, you’ll know Memphis has come full circle the day you hear Robert Fockler announce the Forever Fund has begun raising money again. Forever Fund? Yes, it’s supposed to be a nest egg to pay for important needs.
Fockler, a Memphis philanthropy leader, was all set to build the nest egg.
After all, Memphis was rolling.
You could see it in that time-tested benchmark of generosity — philanthropic giving.
Memphis led almost every city in the nation in giving, and in some years this mid-size region was the leader.
Times were good.
Studies showed the 400,000 households in Greater Memphis on average donated almost 6 cents of every dollar to community anchors such as their church or the United Way.
Only a few weeks ago, Fockler, president of the Community Foundation of Greater Memphis, fully expected he would be busy today calling on donors.
The idea was to raise money for the
Community Foundation’s Forever Fund.
Need cash to build a park, ramp up a tech-savvy classroom or launch some laudable public-oriented project? Forever Fund was to chip in.
In a city known for its philanthropy, Forever Fund was to be a cornerstone, one day hold maybe $500 million — so much money, even a modest 4% gain on stocks and bonds could amount to $20 million in growth money over a year.
Forever Fund could put this growth money into charitable giving and never have to touch the original $500 million. When a community group intent on something important needed cash, it could tap a fund set up expressly for the general good of the region.
That was the Forever Fund.
“Cut back on charity? I don’t think so. It’s ingrained in our DNA not to cut back.” Karl Schledwitz chairman, Memphis-based Monogram Foods
Capital campaign suspended
Of course, everyone knows what happened next.
The pandemic swept America. Within a few weeks, more than 65,000 jobs vanished in metropolitan Memphis after mayors and governors ordered shelter-in-place measures. Not even the 2008 financial crash had hit the Memphis economy this hard this fast.
Forever Fund money-raising plans were tabled in April.
“We hope to do that capital campaign maybe a year from now,” Fockler said. “This isn’t the right time to roll out a major capital initiative when so many of our community resources are going into the challenges we have with the coronavirus.”
For now, many Memphis philanthropy leaders are caught in the financial storm ushered in by the pandemic. Many have steered donations to social agencies, such as the Mid-south Food Bank, that try to soften the human crisis of lost income, closed schools and failed health.
Regional Response Fund created
“More than ever this is the time families find themselves suddenly in need of services,” said Kenneth Robinson, chief executive of the United Way of the Mid-south. “For us that has been a game-changer in articulating our value to this community.”
As the crisis mounted, the Mid-south COVID-19 Regional Response Fund was created by Community Foundation, United Way, Memphis city government, Shelby County government and Momentum Nonprofit Partners/mid-south Philanthropy Network. Nike Foundation quickly pitched in $250,000.
Philanthropy executives funneled money from donors to help sustain worthy causes ranging from arts organizations to feed-the-hungry groups. It was a sterling moment in Memphis philanthropy.
Community Foundation’s donors sent in $511,000 in three weeks. Fockler assembled a team to figure out the agencies in need of the aid.
He expected as much as $10 million would flow in over time from a wide range of givers.
About 15% of Greater Memphis households earn $100,000 or more each year, and 22% prior to the pandemic received regular food and nutrition assistance.
While the pandemic focused philanthropic resources on the immediate crisis, the future of philanthropy in the city was overlooked.
“We have to get, eventually, back to normal,” Fockler said. “Looking ahead, not knowing how long the crisis phase is going to last, it’s not like we can just turn the switch and get back to normal.”
Philanthropy executives remember the 2008 financial crash. Wall Street reeled. At Community Foundation, as assets shrank, donors stepped up to meet the crisis as 50,000 jobs vanished in the region. The foundation’s own financial recovery took several years.
What’s not certain now is how long the stock market will remain down or how generous Memphians will be once the crisis passes. Robinson said people know United Way as a good cause and that may encourage them to contribute, especially in a time of general uncertainty.
“Anxiety about the future will have a trailing edge even beyond the surge of COVID-19,” Robinson said.
Whether people can contribute as much as they did only a year ago is another matter. If donations do recede, other big community-oriented foundations in the city could be pressed to help even more, including the Assisi Foundation of Memphis, Hyde Family Foundation, Poplar Foundation, Pyramid Peak Foundation and Urban Child Foundation.
If pandemic giving has exhausted donors in the region, one sign could appear this summer at Carnival Memphis, a charitable event put on every year since the 1930s.
The civic group regularly raises more than $100,000 in annual donations for its Children’s Charities Initiative. This year donors who may have already given money for the coronavirus challenge could balk when Carnival volunteers ask them for more money.
“We’re worried about it, but it’s hard to judge,” said Memphis real estate developer Ray Gill, who is serving as this year’s Carnival Memphis volunteer king. “I think by the end of the year things will be much improved. Right now, I’m cautiously optimistic.”
‘Uncharted waters these days’
So is Karl Schledwitz.
“Cut back on charity? I don’t think so,” said Schledwitz, chairman of Memphis-based Monogram Foods. “It’s ingrained in our DNA not to cut back.”
He plans to keep Monogram Loves Kids Foundation’s annual October fundraiser at full scale.
Last year’s event raised $700,000. Most was handed to Fockler’s Community Foundation for distribution to children’s groups.
Sponsorships raised most of the money.
The sponsorships were paid for by 150 of the food maker’s vendors and bankers throughout the nation.
Monogram, which operates nine meat and baked goods plants in six states, will ask those contributors to be just as generous this year, Schledwitz said.
“I’m hoping they will be,” Schledwitz said. “But it’s uncharted waters these days.”
Ted Evanoff, business columnist of The Commercial Appeal, can be reached at evanoff@commercialappeal.com and 901-529-2292.