One of the area’s top foundations saw some investments pay off in 2012.
The Grand Rapids Community Foundation enjoyed asset growth of more than $26 million — from $249 million to $285 million — thanks, in part, to a better-than-expected return on investments.
The foundation raised a little more than $18 million from the community during its last fiscal year, which closed at the end of June, according to Grand Rapids Community Foundation President Diana Sieger.
The rest of the money came from a return on investments, she said. The foundation expected a return of about 12 percent, but came back at the end of the fiscal year at 13.1 percent.
So how did that happen?
“Because we’re spectacular,” Sieger joked. “We do raise money each year, but it goes into an endowment. It’s a good combination.”
Sieger said the Grand Rapids Community Foundation is different from most other large foundations in the area as it’s a community foundation. The Internal Revenue Service watches private foundations such as the Steelcase Foundation and W.K. Kellogg Foundation differently because they have one stream of funding.
The IRS monitors the community foundation to make sure funds come from many different sources to ensure it is actually a foundation of the community.
Sieger said the Grand Rapids Community Foundation doles out 5 percent of its 16-quarter rolling average market value. This spending rate, along with careful investment objectives, ensures the foundation doesn’t run out of money.
Still, last year’s increase was a good sign, Sieger said.
“We are really relieved,” she said. “During the past few years, assets haven’t been robust.”
In the 2012 fiscal year, the Grand Rapids Community Foundation authorized roughly $8 million in grants in categories that ranged from education and health, which received the highest amounts, to neighborhoods and environment.
The amounts by category were: Education: $2,682,899; Engagement: $609,192; Prosperity/Neighborhoods: $1,348,863; Environment: $456,192; Health: $2,455,950; Unclassified: $360,180.
One of the programs Sieger said she’s most proud of is the Grand Rapids Public Schools Challenge Scholars. The foundation helps provide schools with a pipeline of support, ranging from educational help to health and wellness guidance. Eventually, the foundation will help secure college and job training funds after the program’s first class graduates in 2020.
One of the largest recent projects was the foundation’s help in creating the Downtown Market.
Sieger also was quick to point out the value of Program Related Investments, which helps fund local foundations and nonprofits with below-market-rate capital. The funds are invested in projects that align with the organization’s purpose, but the funds also eventually will be repaid to the GR Community Foundation.
The Kent County Land Bank and Well House have used the Program Related Investments.
“We put it all in the pot and then we stir the pot,” Sieger said. “We are changing the lives of future Grand Rapids citizens.”