Friday, January 15, 2010

Ask the Administrator: Donations to CC's

A longtime reader writes:

My elite liberal undergrad institution, annual cost
~$55K vs median annual U.S. income of $50K, high in US News rating but
never at absolute top, wants me to come back for the 20th anniversary
of my graduation and write them a big check. Sustain excellence, don't
you know. Fulfill mission, don't you know.

I want to persuade my fellow alums to write their "Class Gift" checks
to a worthy CC or similar. I am wrestling with all of the data and
arguments here, but I need to shape them into something that will persuade a bunch ofGen Xers looking back fondly. Have you any more ammunition for me?
Papers? Essays? Recommended rhetorical strategies? Ways to ensure the
CC we give to is actually worthy?

Oooh, I like this question.

Community colleges typically don't have endowments, so they don't usually have the option of using the interest or investment earnings on accumulated donations to subsidize operations. I don't know if that's because they can't, or if it's just because they haven't, but I've never seen a cc that did.

(Endowments shouldn't be confused with reserves. Reserves are typically quite small, and are the equivalent of rainy-day funds. Over the last year or so, the utility of reserves has become painfully clear. The danger in letting reserves get too large is that legislatures see them as found money, and have been known to reduce appropriations on the theory that they obviously aren't needed. I've seen colleges make conscious decisions to spend reserves down on construction projects in order to fend off prospective cuts. It's the monetary equivalent of 'smoke 'em if ya got 'em.')

Many cc's have foundations, though, through which donors give money that typically goes either to student scholarships or to equipment purchases. As with most colleges, extraordinarily large donations often give 'naming' rights, so you could endow the Big Muckety-Muck Science Building.

One of the biggest barriers to philanthropic growth in the cc sector is that people usually identify most strongly with the college to which they subsequently transfer. Since four-year schools are usually much more practiced at and attuned to 'development' – the approved euphemism for fundraising – it can be hard to catch up.

The perverse economics of philanthropic giving are that people like to give to success, rather than to need. That means that the Harvards of the world have a much easier time soliciting donations than do the cc's of the world, even though Harvard certainly needs it less.

There's no shortage of good arguments as to why cc's make good targets for donations, but from what I've seen, most donations aren't motivated by good arguments. They're motivated by relationships. Those relationships are cultivated quite intentionally by the savvier colleges, using everything from alumni associations to personal appeals to football. (A contact of mine at a respected private university told me last year that her uni is starting to retreat from the adjunct trend because it discovered that students whose professors came and went didn't feel as attached to the uni, and the administration was afraid of the consequences for future donations.) Colleges with more part-time students, no dorms, and no high-profile athletics are already disadvantaged at this game.

If you want to support a particular cc, my first recommendation would be to call its foundation office, if it has one. Let it know that you'd like to be supportive, and you'd like to see what you could do beyond just writing checks. Many cc's host local events – wine tastings, golf outings, silent auctions, etc. – on the theory that these events are twofers: you raise money directly through the event, and you build a brand loyalty that leads to future giving. I've seen people buy entire tables at events, and then recruit people to join them there; the idea is to start building a sense of identification. If you're in a position to help with an event, mention that. If you can help the foundation reach a new group of alumni or local people with money to give, mention that. If you can bring an entire table of new people to an event, that's huge.

The foundation office can also provide anecdotes indicating the quality of the school. (If it can't, that's a huge red flag.) Most cc's have particular traits or programs that are sources of special pride, whether it's the nursing program, the transfer pipeline, or its success with underrepresented groups. Interestingly, I've found that some very conservative people are often much more comfortable giving to community colleges than to many other causes, since the 'moral hazard' of 'charity' is mitigated by the fact that students have to work hard to get through the programs. Getting in is easy enough, but getting through takes real work. Rather than producing dependence, colleges produce independence. There's something gratifying, and socially useful, in that.

As far as arguments or rhetorical moves go, I'd go with terms like 'opportunity' and 'independence' rather than 'need.' 'Need' can connote helplessness or fecklessness, and even futility. We're about hope. Leave the 'need' appeals for where they make more sense, like Haitian earthquake relief. (I support Doctors Without Borders, but that's only one choice among many.) This is about building the capacities of the people in your hometown.

Some people like to set very specific terms on the use of their gifts. That's fine, if it meshes with what the institution needs, but over time those earmarks can lead to some weird imbalances. “Unrestricted” gifts are the gold standard, since they can be used for the areas of greatest need, rather than whatever is fashionable or somebody's pet program. If you're happy either way, I'd strongly encourage specifying that your gift is 'unrestricted.' It will do much more good for the buck that way. Of course, if some sort of earmark is what the relationship is built on, the foundation office can work with you to craft the earmark to do the most good while still honoring your intentions.

I'll admit to having shifted my view of philanthropy in the cc context. A few years ago, I was concerned that it would give too handy an excuse to legislators to cut the budget. Now I'm convinced that that ship has sailed, and we need to diversify funding streams. When even solidly blue states are hacking away at the appropriations, it's time to put the misgivings aside and build sustainable alternative revenue streams. The students need opportunity now more than ever, and giving could fill that need.

Thanks for your interest, and good luck!

Wise and worldly readers – especially those with experience in philanthropy – what would you add or correct?

Have a question? Ask the Administrator at deandad (at) gmail (dot) com.