- What is a community foundation?
- How can community foundations assist donors?
- How long have community foundations been around?
- How are the Sydney Community Foundation's boundaries defined?
- How did the Sydney Community Foundation evolve?
- How is the Sydney Community Foundation governed? To whom is it accountable?
- Why establish the Sydney Community Foundation when there are a lot of other charitable organisations already in existence?
- How are grants made?
- Why should a donor give through the Sydney Community Foundation rather than giving directly to a charitable organisation?
- Are donations to Sydney Community Foundation tax deductible?
- How easy is it to become a Sydney Community Foundation donor?
- Is there a charge to establish a sub-fund with the Sydney Community Foundation?
- How can donors be sure that their gifts are carefully managed?
- Can donors decide how their gift is used?
General information about community foundations
What is a community foundation?
A community foundation is an independent public structure comprising a collection of donations and endowed funds established by individuals, families, companies, government agencies, local councils and charitable organisations to make a lasting difference to the life of the people in their community.
The foundation acts as the trustee for donations, and is managed by a Board of Directors made up of community leaders representing a cross section of the community. Funds donated are pooled and carefully invested under the supervision of this Board. The income generated each year from this permanent and growing investment is distributed in the form of grants. By providing leadership on issues of broad community concern and developing a body of local knowledge, a community foundation is in a position to help donors fulfill their charitable goals both during and after their lifetime.
Back to top
How can community foundations assist donors?
A community foundation offers donors the opportunity to establish a subfund within the structure of the foundation's public fund. The money donated to a community foundation is invested in perpetuity, and the annual income from the subfunds within the community foundation is distributed in the form of grants to areas of need within the community. As these needs change over time, a subfund's annual distribution can be re-directed to emerging and new areas of need. By making their gift through a community foundation, donors can use the grantmaking capabilities of the foundation. This allows donors to create a permanent endowment for the benefit of the community they love.
Back to top
How long have community foundations been around?
The community foundation movement originated over one hundred years ago in the USA. There are now well established foundations with substantial endowment funds in many communities, both urban and rural, in the USA, Canada and the UK. Closer to home, there are nearly thirty community foundations in Australia, providing services to donors and the community in large cities, across a state, or in regional areas. For more information about Australian community foundations, click here.
Back to top
How are the Sydney Community Foundation's boundaries defined?
As the SCF was created to benefit the community of Sydney, it provides funding for initiatives and projects that are delivered within the Sydney region. Generally speaking, this region is bordered by the Hawkesbury to the north, the Blue Mountains to the west, Camden to the south-west and the Sutherland shire to the south.
Back to top
How did the Sydney Community Foundation evolve?
In 2003 founding members Charities Aid Foundation Australia, United Way Sydney, Philanthropy Australia and Heather Kent formed a steering committee to establish the SCF. Initial financial support to undertake an extensive Feasibility Study and donor research was provided by several donors including the then NSW Premier's Department, The Myer Foundation and some Sydney individuals. You can read more about the SCF's background here.
Back to top
How is the Sydney Community Foundation governed? To whom is it accountable?
The Foundation is governed by a volunteer Board of community leaders and prominent citizens representing a cross section of society. You can read more about our Directors here. The Foundation is a public company and registered under the Corporations Act 2001. It is regulated by the Australian Securities and Investments Commission (ASIC). The company and its two funds are endorsed as Tax Concession Charities (TCC) by the Australian Taxation Office (ATO) and the Tax Deductible Fund is endorsed as a Deductible Gift Recipient (DGR) by the ATO. The Foundation complies with all the legislation and regulations governing public companies.
Back to top
Why establish the Sydney Community Foundation when there are a lot of other charitable organisations already in existence?
A community foundation is not a charity. It is a catalyst and resource for philanthropy throughout a particular region/community. By giving through the Sydney Community Foundation, donors combine their gifts to build a growing and permanent endowment for the benefit of the Sydney community.
A community foundation is an option for everyone (not just wealthy individuals) to contribute and make a lasting difference within their community.
A community foundation can also provide a public community leadership role, because of its work in connecting people around a common cause. The Sydney Community Foundation works in partnership with donors, other philanthropic foundations, service providers, charities and government to identify and support grassroots community needs particular to the Sydney community and promote solutions to problems that may not normally be funded.
Back to top
How are grants made?
Tips for grantseekers and an expression of interest form are available on the website.
Expressions of interest received are reviewed by the Foundation's Projects committee, which is made up of some of the Directors of the Foundation and serviced by the Foundation's Executive Officer. Selected applicants are invited to submit a full application and the Board of the SCF makes the final decisions on grants to be made. Donors who want to have involvement in their giving are invited to participate in site visits and discussions about potential grants.
Back to top
Donors
Why should a donor give through the Sydney Community Foundation rather than giving directly to a charitable organisation?
Unlike a once-off donation, donations to the SCF are pooled and invested and the income generated from this investment is used for the ongoing good of the community.
The main benefit is that a donation to the Foundation becomes a permanent investment in the community which continues to give over time, meeting the needs of future generations.
Furthermore, a donation to a community foundation can go a lot further and have more impact as it is part of a larger pool. Giving is made more effective because the foundation provides donors with expertise in grantmaking and local knowledge. As community needs change over time, the Foundation will change to meet those needs, drawing on its community knowledge and extensive networks.
Back to top
Are donations to Sydney Community Foundation tax deductible?
Donations to the Tax Deductible Fund of the SCF are tax-deductible. Gifts made from that fund must be given to organisations with Deductible Gift Recipient (DGR) status. Donors that want to direct their giving to a broader range of charitable organisations and who do not need a tax deduction can give gifts to the General Fund. All earnings within both funds are exempt from tax.
Back to top
How easy is it to become a Sydney Community Foundation donor?
The Foundation welcomes donations of all sizes - every donation makes a difference. Smaller donations go into a pooled fund with others to have greater impact in meeting local needs in greater Sydney. Donors also have the option to establish a named subfund. To find out more about this option click here. This requires the completion of a donor application form. For further information, donors should contact the Foundation's Executive Director.
Back to top
Is there a charge to establish a sub-fund with the Sydney Community Foundation?
The Sydney Community Foundation charges a trustee fee to the subfunds it manages. Donors who prefer to donate money on a flow-through basis are charged a fee when the donation is paid out as a grant.
By charging a fee, the Sydney Community Foundation protects and leverages your philanthropic investment with highly skilled assistance, advice, mentoring, introductions to other philanthropic funders and networking opportunities.
Partnering with the community sector in this way takes time and money. Our fees enable us to provide high quality support to the organisations we fund. It also allows us to provide services to our donors, and to continue to grow our business. By applying sound investment principles to philanthropy, we add value to your social investment.
Back to top
How can donors be sure that their gifts are carefully managed?
The Sydney Community Foundation Board, consisting of community leaders representing a cross section of society, acts as trustee for the SCF's two funds, the Tax Deductible Fund and the General Fund. The Board has developed an Investment Policy with the primary objective of providing a high degree of security through appropriate diversification and liquidity, while maximising returns within a conservative approach. The Investment Committee of the SCF monitors the Foundation's investments and the state of the markets and makes regular reports to the Board.
Back to top
Can donors decide how their gift is used?
When establishing a named subfund, donors can identify their areas of funding interest and work with Foundation staff to identify the most effective ways to meet their objectives. Under the current ATO ruling governing the operations of a community foundation, the Foundation's trustee has final discretion on grants made after considering the recommendation/s of the donor and/or the donor's advisory committee.