'Giving circles' growing as new form of Pittsburgh philanthropy
The donation model is going beyond the kitchen table, gathering gravitas and involvement from foundations
May 5, 2013 4:00 AM
By Joyce Gannon Pittsburgh Post-Gazette
After he sold his oil and gas company, Doug Gouge found himself navigating the transition from being a business owner focused on generating profits to a retiree looking for satisfying ways to pursue philanthropy.
"You're not used to thinking like that ... getting up and saying, 'How can I give money away?' " he said.
So when the Pittsburgh Foundation invited Mr. Gouge to join a new giving circle in which he and other donors would pool resources and contribute a total of $100,000 to projects focused on connections between health and the environment, Mr. Gouge readily agreed.
"It was an easy yes for me," said the 68-year-old Shadyside resident who sold Douglas Oil & Gas Co. to drilling industry giant Rex Energy in 2007.
Giving circles typically have involved friends meeting over drinks and food in each other's living rooms to discuss what charitable causes they should support.
But the model has evolved into one that some foundations are using to assemble groups of donors with common interests around particular issues and then help those groups make informed, strategic contributions.
That approach to giving circles "gives this concept a little more gravitas than the previous kitchen-table type of group," said Andrea Pactor, associate director at the Women's Philanthropy Institute at Indiana University's Lilly Family School of Philanthropy. "It gets like-minded people together to pool their resources for more impact in the community."
For its first giving circle, which launched earlier this year, the Pittsburgh Foundation pitched the idea of a circle focused on health and environment to a number of its donors and quickly received 20 commitments.
Each donor put up $2,500 and the foundation matched each gift to create a total fund of $100,000.
The foundation set up site visits for the group to three organizations where researchers are studying how the environment intersects with health and disease: UPMC Hillman Cancer Center; Children's Institute of Pittsburgh; and Children's Hospital of Pittsburgh of UPMC.
"The idea is not to steer [the giving circle] automatically to those nonprofits but to learn about the issues first and then find out where the opportunities lie, " said Grant Oliphant, president and chief executive of the Pittsburgh Foundation.
After gathering information from the experts, the group will identify local nonprofits engaged in those issues, examine what the nonprofits do and ultimately vote on where to donate their funds.
"We have no idea yet what will emerge," Mr. Oliphant said. "Maybe 20 people will say it's so clear that one outfit is doing the work we all care about and we should give the grant there. Or they may decide to distribute it differently. We're not pre-determining the outcome. We're along for the ride."
After he sold his business, Mr. Gouge established a family fund at the foundation and planned to educate himself on where to target his donations. Among the attractions of the giving circle, he said, is being part of a group that's gaining expertise about issues he cares about.
"I have an interest in health and the environment just in general. The way it's structured, I'm meeting different people involved in those types of issues. I'm connecting with other people who are interested in philanthropic activities and can network with them," he said. "At the end of this process we'll come to a consensus. We can give a little to everybody or all to one group. That will be an interesting process and a way to leverage my time and money."
The giving circle for health and environment is the first of a number of circles devoted to different community issues that the foundation expects to launch. Mr. Oliphant declined to discuss how many are planned or what the other topics might be. "This is a prototype. Then we'll move on. We have multiple ideas but haven't settled on them yet."
At the Philadelphia Foundation, two giving circles are up and running. The Asian Mosaic Fund Giving Circle funds nonprofit programs that promote and support the Asian community in Philadelphia, such as the Asian Arts Initiative and Asian Americans United, a leadership program for high school and college students. The other is Impact Philadelphia, which targets as members young professionals who award grants to nonprofits that address community issues, including food shortages in low-income neighborhoods and vocational training.
The Philadelphia Foundation manages the circles' funds and matches 25 percent of donations.
With overall charitable contributions down the last several years as a result of the recession, giving circles can help foundations engage new and existing donors who "are more and more interested in the impact of giving," Ms. Pactor said.
According to the last available annual study by the Giving USA Foundation, donations rose 4 percent in 2011, to $298.4 billion. But that amount was still below a 2007 record $309.7 billion before the financial crash.
For Kim Wagle, 42, of the South Side, the Pittsburgh Foundation's giving circle provided a way for her to focus donations on health and environmental issues that are significant in her life.
"We live on the South Side, so there's nothing like nice clean water on the river and clean air," Ms. Wagle said.
Though she and her husband, Matthew, had a fund established at the foundation prior to being contacted about the giving circle, she joined the group without her spouse.
During the group visit to Hillman Cancer Center, she was intrigued with a presentation by experts in environmental oncology about the impact of air quality on lung cancer patients and how some diets can reduce cancer risks.
"We're all impacted personally with health issues. These are things that hit home for so many people. It was very clear to me this was something I wanted to be part of," she said.
For future giving circles, Mr. Oliphant expects to tap a range of people from the foundation's donor base, including some who weren't interested in health and environment causes.
The foundation has $800 million in assets and distributed about $35 million last year.
"I would view this as a giving circle that's turbocharged by the fact we're also putting in matching money. It's more structured and targeted and has additional money put on the table." Mr. Oliphant said.
"We're taking an old model and applying it to a new circumstance to work in closer alignment with our donors on priorities we all care about."