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Judy Barber |
COMMENTARY As we approach the New Year, it is a good time to look back and evaluate how the year's charitable giving has met our own needs as well as those of donees. Sound selfish? I don't think so. Many of us want to give generously to our community; what harm is done by making sure that we are also contributing to our own sense of well-being in the process? I talk to many people who are deeply satisfied by how their contributions seem to make a difference. Unfortunately, I also talk to nearly as many who feel frustrated because they've made donations for the wrong reasons. They either feel rushed to get the money spent or pressured by over-demanding organizations. Many of us know people who felt honored when asked to serve as a member of a prestigious board member, then overextended when the level of giving far exceeded their expectations. This year, as I look back on my own experiences of charitable giving, which began when I turned 18, I have found myself searching for a consistent thread in my philanthropy over the years. Not surprisingly, I've found that the giving that has most deeply resonated with me is funding and supporting programs that provide recipients "a way out." In my freshman year in college, I joined an inner-city church, which provided programs for teenagers, welfare mothers and their children. Between my work there and the Sunday tithing, I thought I had made a real difference, which helped me feel better about myself. Later in my mid-twenties, I taught continuation high school, the last stop before students either drop out of school or get thrown out. The school became involved in Project Community, a specially funded program to build self-esteem for teenagers. Each year as I held my breath waiting to hear whether the program would get granted, I worried about those 16 to 18 year old students who might not get this special support that encouraged finishing school, getting jobs and going to college. Nothing like a grass-roots experience to witness the value of grant money first-hand. My own need for a different kind of "way out" or opportunity had nothing to do with poverty or lack of an education. My high school years were spent in a picturesque village on the San Francisco Bay with a sweeping view of the city. I grew up in a loving family, had an academically enriching education and wanted for nothing materially. But like many youth of my generation, I was restless. A lot of the talk around me seemed like empty chatter and I longed for deeper conversations to help me get beyond my own comfortable world. I wanted to learn how to make a real contribution and be part of a community with a larger purpose. Over the years, my giving has reflected the same needs of that teenage girl looking for more from life. So as you plan your philanthropy for next year, you may want to include projects that resonate with your most deeply held values. Perhaps you'll also see a pattern of giving that reflects a need you once had which makes current giving particularly significant. Sometimes a life experience, a death, a recovery from a health crisis or simply seeing someone you love find support through a difficult time, triggers a desire to help others in similar circumstances. Far from being selfish, being mindful of your own purpose is just plain smart. Besides, I can't think of a better philosophy to take you into 1997. With wishes for a happy, healthy, and charitable New Year.
PERSONAL EXPERIENCE
Conflict Resolution: A Family Foundation Finds Its Way How does a family patriarch who calls himself "a crusty old conservative" with "three screaming liberal daughters" create a family foundation that funds two million dollars in projects each year and is a vehicle that has deepened and strengthened family ties? Sound impossible? Meet the members of the Board of the Jacobs Family Foundation and the Jacobs Center for Non Profit Innovation in San Diego, California. Dr. Joseph Jacobs, who holds a doctorate in chemical engineering and is founder of Jacobs Engineering Group, founded the Jacobs Foundation in 1988 along with his wife, Violet. In 1989 they invited their daughters, Margaret Jacobs, a social worker; Linda Jacobs, an economic development consultant in the Middle East; and Valerie Jacobs Hapke, a psychotherapist to join the foundation. Son-in-law Norman Hapke was elected to the Board in 1993. Later, after his marriage to Linda, Philip Mark Talbrook also joined the Board. Linda wasn't able to join us for the first interview, but we caught up with her so we could find out how she and her father handled the transition when he stepped down and she took over his former post as Chair of the Board. FM: How did the idea of a foundation come about? Dr. Jacobs: I founded the company in 1947. It grew, and we went public in 1971. All three daughters were grown and they read the prospectus and they came out with this sort of involuntary, "Gee, Dad you're rich." I became very angry at being described as rich. We decided for a number of reasons that money could be destructive or constructive and we wanted to do something good with it. We did not want [our money] to be destructive to our daughters, whom we loved and respected. After a couple of sleepless nights, we got together with them and said that we had decided that we would leave them with a minimum amount of money. They would be taken care of if they got sick or unable to make their own way, but that we wanted them to make their own lives that were independent of inherited wealth. We wanted them to have self respect based upon what they did, independent of what their father and mother had done. I explained to them that we had decided to give the money away during our lifetime. FM: How did they respond? Dr. Jacobs: It was the most poignant moment in our lives when all three of them enthusiastically said, "Gee, Dad, that's great." Can we help you give it away?" Until 1988, we gave small gifts of stock in our company. In 1988, we started to implement the foundation. We invited - I'd learned by that time not to call them girls - the three women to join with us and start deciding where to give the money away. By that time they were adults with their own careers and own independence. FM: I'm wondering, in 1989 when all of you started to work together, what your thoughts were about getting involved in this foundation? Meg: It was just a rough time. [I wondered] how we were all going to come to mutual decisions on things that we historically have disagreed about. Val: It started with dad telling us that he was going to contribute a lot of money to some conservative think tank. Val: And then all hell broke loose. Meg: That was our first dispute. Dr. Jacobs: Confrontation. Meg: We had already started. I came in as the first executive director. I was the only one who wasn't working at the time. I had no experience in this sort of thing and was flying by the seat of my pants and then this first confrontation came about. FM: Since it was your parents' money, how could you object? Val: Well, basically we gave him the option of having us in the family foundation or not. He's the one who said "I want you to participate in giving the money away and we will all be equal in this." We said, "you told us you wanted us to have an equal say. Here we are and we're objecting to this." Dr. Jacobs: They speared me on the horns of the dilemma. Norm: As I saw it from the outside, it came together in an interesting way. Mostly because of Joe's genius and willingness to compromise. He basically saw he had a rebellion on his hands. His ideas about how this was going to be run had caused him to be hoisted with his own petard by his daughters. It was obvious the think tank wasn't going to work. It was ideologically opposed by his daughters, who were liberal, while he was conservative. He realized if he was going to have his daughters on the board, they were going to have to find some common ground. He changed his focus to accomplish liberal ends with what he saw as conservative means. He found ways to break the cycle of dependency in people and agencies through a conservative approach of free market and entrepreneurialism. FM: So how did you go about making decisions on what you would fund? Dr. Jacobs: It evolved. When we first came together we had a rather fuzzy vision of where we had common ground. Meg: I came across an article by a man named John Hatch. He's with FINCA (Foundation for International Community Assistance). It's a micro-enterprise organization. It gives tiny loans to the poorest people outside the United States. Very poor people come together in groups and are given loans, usually by guaranteeing each other's loans, in place of collateral because they have no collateral. It's a method to help people pull themselves up out of poverty. I was very excited by it and figured my father, the great believer in the free enterprise system, would be very excited by it too. And when the model was proposed to the family, it was received with enthusiasm. If people can start their own businesses or make their businesses grow, they can become self-sufficient. That was something we could all jump on. Dr. Jacobs: FINCA was all over South America and we all said, "Let's stay close to home. We have millions of people in poverty in this country." We wanted to apply the same model of encouraging independence through entrepeneurship in disadvantaged neighborhoods in America. FM: So you began by loaning people money to start their own businesses? Dr. Jacobs: Yes, but we got the business community to guarantee these loans. Those loans are working very well. The default rate is very low. Meg: But there is a problem with the collaboration of the agencies. Dad can speak to that more. Dr. Jacobs: We found the agencies that have access to the poor, who we thought would be the conduits for the money were very competitive. They've established their own turfs within the communities. Norm: So, gradually, part of our discovery process was that we just didn't want to give money, walk away and get a report. We wanted to be partners with agencies. FM: It sounds like the Jacobs Family Foundation comes in with an approach that agencies can accept or reject. Val: Absolutely. We've found the majority of traditional agencies would like us to write a check and walk away. We look at things differently. Our approach isn't for everybody. FM: But it is a blend of liberal and conservative politics. Norm: What we do is what you might call liberal goals with conservative means. It's not just liberal goals; it's sensible goals, which are an amalgam of what both sides want. We cross the boundary between political labels. Dr. Jacobs: While we all went into this with political labels, mine being that of a "crusty old conservative" and "our three daughters as screaming liberals," we've learned to ignore labels. FM: Your foundation is an effective model for bridging these differing political perspectives. How has the funding changed over the years? Val: We've started a new foundation called the Jacobs Center for Non-Profit Innovations. That is our technical assistance branch. The Jacobs Family Foundation has shrunk quite a bit. JCNI is doing most of the work and the Jacobs Family Foundation has become pretty much a straight grant making foundation. FM: Let's return to some of the family issues. Dr. Jacobs, Linda was the first person to succeed you as Chair of the Board. How did the issue come up? Dr. Jacobs: I'll let Linda answer that. Linda: Well, he thinks he was deposed, that's how he thinks it happened. I think the idea was that if the foundation belongs to all of us, then we should all have a turn at leading it. We thought we would do it in age order. Meg, as the oldest, didn't want to do it. She'd been the first administrator for the foundation and she was sick of the paper work. I was the second kid. FM: Were there skills or wisdom you felt you needed from your dad as you transitioned into the chair position? Linda: Dad takes more of the long view. He's got more experience than I do in being patient with other people's failures or the failure of the foundation to affect change. I tend to be more hot-headed or reactive. Dr. Jacobs: I think that's true. Linda's a lot less tolerant than I am. She doesn't mince words. FM: Were there skills or wisdom you wanted to pass onto Linda as she became chair? Dr. Jacobs: Nothing specific about running the foundation. Linda has been around me long enough to know the way I think and the way I examine problems. All three seem to feel comfortable with that. FM: So what really makes this work? Val: There's always been dialogue in our family. It's not something new. It's not a process we have gone through; it's a family trait. Meg: The process of coming to decisions involving a lot of money and a lot of work has made us all more mature. Linda: Another thing is the Sunset Clause. In twenty-five years we go out of business. There is no marking time. You're really trying to figure out what you're going to leave the world in new programs and methodologies. Norm: I think the catalyst was the daughters saying, "If you want us as full partners, then treat us as full partners" and his full acceptance of that. Dr. Jacobs: What it finally came down to was my accepting the fact that I just couldn't pay lip service to respecting the intelligence and independence of my daughters. I had to demonstrate it in concrete ways. FM: We believe, for families facing these complex issues as part of their philanthropy, The Jacobs Family Foundation will serve as a model of candor, respect and a unique approach to bridging differing social and political perspectives. Thank you. For more information regarding the Jacobs Family Foundation, write to:
Jacobs Family Foundation
PROFESSIONAL VIEW
A Donor-Activist Speaks How can we spark the next generation and their interest and involvement in community and philanthropy? In my family, at age fourteen, we were ceremoniously given a poster with the words of our grandfather: "Do something for the city, the country, and the community in which you live." In addition to these words, my parents were very overt about their community commitments and clear about their enjoyment of service. In short, I was blessed with values, which were carefully transferred by parents who accepted and enjoyed being role models for giving. In twenty-four years of working with families, I have seen a tremendous variety of approaches for involving families in giving and volunteering. Examples include: expecting children to be involved with community service for a certain number of hours weekly each summer; starting a special "giving account" for philanthropy at age fourteen or older; participating in the family foundation process; or seeding or encouraging careers in the nonprofit or service sector. Average annual giving by the wealthy has declined in recent years. In my mind, the best way to encourage children and other family members to become givers is to share your joy about your own passionate interests. It is surprising how often, in working with families on their philanthropic interest or family foundations, I find that family members really don't know about one another's involvements, which may include other boards, volunteer efforts or favorite funding projects. Family meetings when they occur, may be focused on a crisis at hand, on new family members, on major business transitions or the agenda of the overall family foundation. There are three methods for family giving: 1. Family foundations: Over 30,000 of them nationally, most without staff have been used as vehicles for holding and disbursing valued family assets and to bring family members together. These foundations can be vehicles of development of family values, leadership and unity, or they can engender family dysfunction. Keys to success: Periodically evaluate the participation of family members and the mission, and also get assistance from a philanthropic advisor. 2. Community foundations: There are 600 institutions nationwide, including over 70 women's foundations in which individuals and families can give together through donor-advised accounts. With the support of staff, and generally nominal fees, donations are recommended by the donor. Accounting, anonymity and all correspondence can be managed by the foundation staff in the name of your fund, which can either be your family name or ascribed a project name. The benefits of using another foundation's umbrella include enormous financial and timesaving for the donor. Also, when giving through community foundations there is a larger tax deduction (50% of income) than is permissible with private family foundations (30% of income). Keys to success: A clear mission statement and plenty of time with the foundation staff members is essential so that they fully understand your goals for your donor-advised fund. 3. Checkbook giving: This method is often heartfelt, spontaneous and can be just as effective as any established giving program. While some donors do put all their giving through their family account or their donor-advised account, most donors also have individual giving programs which are often direct gifts from their checking accounts or from personal stock transfers. Keys to success: Devise an organized giving plan and a procedure for discerning goals and evaluating requests. Discussions with tax advisors about the advantages of giving appreciated stock, instead of direct cash or checks, is also highly advisable. Many family members who are thrown together by family foundations and businesses don't know each other. They are ignorant of each other's skills, interests and experiences. Jay Hughes, a prominent New York attorney who works with wealthy families, has family members begin the process by writing and sharing their resumes with each other. Sometimes the intention of the older generation is to encourage the next generation to continue the commitment to long-held interests of the older generation. However as one of our members at Resourceful Women says: "If you want children to give it away exactly as you want them to...then don't bother to give it to them. It's best to give it away yourself." Family members should think carefully about this as they do estate planning. The creation of a charitable trust can be a wonderful tool, if part of our legacy is a good planning session with our heirs. If families want their children to develop their own interests, they should give their children as much autonomy as possible - a good rule of thumb is to allow one-third of the family foundation's annual income for giving accounts. Young people, especially, need opportunities for their own learning, without the critical eye or opinion of parents. Dividing the pie can sometimes give everyone more creative expression. Families who are developing goals and methods for their foundations can use professional support. The Council on Foundations (Family Foundation's program in Washington DC), The Philanthropic Initiative (Boston) and Resourceful Women (San Francisco) have been set up to support families in their giving and goal setting. With so many challenges in our communities today, and with varying family interests and personalities, a few hours working with philanthropic consultants, or attending meetings with other families involved with foundations, can move once stagnant family meetings to creative and enjoyable sessions. Participating in family foundations and sharing giving practices and strategies can promote respect for differences, or it can promote opportunities for judgment and control. Perhaps the biggest mistake that I see anyone make is to judge another's volunteer and giving activity. Given the critical need for philanthropic leadership in this country, I think we cannot afford to create the slighest barrier to participation. The Rockefeller family has long supported each child in developing its own interests and supported one another's leadership. Imagine, if your family became your cheering squad and mentor group. Giving can be fun and enormously stimulating. Giving rewards not only the community, but also the giver. The satisfaction that the donor receives, in feelings of community involvement and deepening commitment to creative change, can be immeasurable. If giving is indeed a privilege and responsibility and a skill that we must learn, then what better way than with support? With public funding now being transferred to the private sector, each family has a special charge to enliven and redirect its philanthropic leadership. I urge you to hold a family meeting to envision your family or personal philanthropic goals for the next millennium.
Tracy Gary has been a donor-activist for over 25 years. She is the founder of the women's foundation of Resourceful Women, a resource center for women of wealth based in San Francisco and fifteen other non-profits including her latest project Chance Makers. Along with Melissa Kohner, she is the co-author of Inspired Philanthropy. Tracy can be reached at www.massmanassociates.com.
EXCHANGES For those of who believe many of the social problems of this society will continue to be solved by the private sector, Claude Rosenberg's 1994 book Wealthy and Wise: How You and America Can Get the Most out of Your Giving was an eye-opener. Rosenberg, a former money manager described the meaning of surplus money and how he discovered after some calculations, that he had two choices: either he and his wife, Louise, could spend more on themselves and their family or give more away. They chose the latter. Rosenberg showed through statistical calculations how affluent families were giving away less than they could safely afford because they were afraid to give away capital. Now Claude's non-profit research organization New Tithing Group has created an Internet calculator, PrudentPal Charitable Giving Planner a web-based tool that in a safe and confidential way users determine their potential to give. To learn more about New Tithing and the PrudentPal go to www.newtithing.org. Family Money was so taken by the Rosenberg's' dedication to philanthropy that we asked them to write about one aspect of their giving that has been most meaningful to them.
On Enlightened Philanthropy
We were fortunate to have benefited from sound fundamentals that the San Francisco public schools provided us many years ago. These educational opportunities are frankly much harder to come by today in schools throughout most of America. It is therefore natural that we would want to improve public education today. We believe solid learning experience is the backbone of human behavior, which in turn is the answer to community safety
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