September 8, 2010; Source: Seattle Times | Is the Seattle Foundation under former Seattle Mayor Norm Rice demonstrating the next phase of the evolution of community foundations—that is, in terms of how community foundations raise and dispense money? The most recent phase was their dependence on donor-advised funds, a CF modality facing tough and well financed competition from the so-called commercial gift funds like Fidelity, Vanguard, and Schwab. Rice’s foundation has created a new website for online financial transactions between donors and nonprofits, allowing nonprofits to post stories and charitable givers to channel donations to them. “The Web über alles,” Mayor Rice says. On the Foundation’s website will be information, including staff evaluations and reviews, of 675 nonprofits (to start, the Foundation encouraged the 1,300 nonprofits that it supports to contribute profiles to the website). Potential donors can make no-fee donations to the nonprofits on the site; existing Seattle Foundation donors can make donations from their funds that the foundation manages on their behalf and charges a 1 percent fee. This represents a substantial foundation investment in its online infrastructure, which the foundation believes will generate a new $500,000 or so in donations to nonprofits in the website’s first year of operations. Will the $1.45 million investment pay off in terms of new moneys for nonprofits? Or, as some charge about the online capacities of the gift funds, will it merely be a new venue which donors might use for their contributions, a shift of venues as opposed to an increase in charitable volume?—Rick Cohen
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