Giving Little Guys a Break

Away from the philanthropic foundations housed in high-rises, with their fancy luncheons and multimillion-dollar grants to universities and museums and the like, there is another more grass-roots, community-based level of giving in California that largely remains out of the mainstream.

In this state of shifting demographics, there is the world of storefront nonprofits in East L.A., South-Central, Koreatown and Oakland working on marginalized issues such as citizenship, basic health care, teenage pregnancy and acculturation programs.

Then there are the intermediary, so-called “population-specific” funds--many of them ethnic-based--that are charged with seeing to it that their member nonprofits have money to operate. These California funds, which work with populations that include women, gays and lesbians, Latinos, Asians, Native Americans and African Americans, are relatively new and have remained small and far removed from partnerships with the large funders.

But last month, the California Endowment approved a $4-million grant to be parceled out between 11 of these small population-specific funds--which generally are the only ones of their kind in California. Those funded in Los Angeles are the United Latino Fund, Brotherhood Crusade, the Los Angeles Women’s Foundation and the Asian Pacific Community Fund.

The intent of the endowment is to begin building the infrastructure of the small funds so they can become self-sufficient organizations that can grow their community-based work in the ethnic communities that mainstream philanthropy often doesn’t reach and, perhaps most important, become effective fund-raisers of the future.

In an era in which watchdog groups complain that as little as 2% of foundation money, which makes up about 13% of all philanthropy, goes toward organizations working with the poor, women and children, it’s the first time that a mainstream funder has established a partnership with such population-specific funds with the intent to track their progress.

Modest as the California Endowment grants are--the $200,000 to $500,000 individual awards are all the small operations can absorb--the organization is the first to go beyond observing.

“It’s an exciting development,” said Henry Ramos, a Berkeley-based consultant who helped the endowment identify the 11 funds and who sees in some of the organizations and their target communities untapped sources of additional philanthropic activity. “It’s certainly significant here in the region.”

“It’s one thing for a huge foundation to make a grant of $200 million to a medical school, but that doesn’t really get into the communities,” agreed Lewis Reid, president of the California Endowment. “If you take an organization like ours and say, ‘As a strategic objective we want to move into the multicultural communities that make up California in order to weave a social fabric that is going to make this a better place in which to live,’ then you have to find out how to penetrate the communities.”

The California Endowment, with $3.7 billion in assets, is the 10th-biggest foundation in the country and the largest health funder in California. The work with the 11 population-specific funds is part of the endowment’s philosophy of strengthening community-based philanthropy and those organizations already doing meaningful--though limited--work with clientele they know personally.

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To be sure, there are risks with the grants, said Jai Lee Wong, the California Endowment’s senior program officer who navigated the proposal within her organization.

Of the 11 groups, the gay-lesbian and women’s funds are relatively small but arguably already successful and have gained a critical degree of support from within their own communities. Indeed, the Los Angeles Women’s Foundation has a $2-million budget and staff of 11.

The funds truly on the fringe are the ethnic ones, like L.A.’s United Latino Fund. Nearly 10 years old, it has total assets of roughly $200,000, a staff of two and hasn’t made consistent grants for two years.

The Asian Pacific fund, housed in a small office just north of downtown, was established in the mid-1980s, has a staff of two and an annual budget of roughly $250,000. Many of the two dozen member organizations--serving Asian populations around Los Angeles--that it supports have bigger budgets than the fund itself.

The ethnic funds’ slow growth has at least partly contributed to the hesitation of mainstream funders, wary of the funds’ viability, to partner with them.

No chief executive of a mainstream foundation will say it publicly, but privately some question several things about “population specific” funds, including their perceived divisive nature, the experience of their leaders and, for some, an inability to gain support from within their communities first before asking for big foundation support.

The ethnic funds counter that mainstream philanthropies have kept them at arm’s length when it comes to seed money--not program-specific grants--to allow the organizations to set up an internally solid operation that will bear fruit later.

“That’s the difference between what the California Endowment is doing,” said Woody Carter, executive director of the Bay Area Black United Fund. “I agree we should be further along for an organization that’s been around for 24 years. On the other hand, I know it’s been a constant battle to get mainstream funders to see us as a legitimate intermediary in our own community.”

Said Wong: The ethnic funds “had to ask themselves some tough questions. Why is it that they are not growing as quickly as they should be, given the resources that are out there--especially in the Latino community?” Wong emphasizes the word “partnership” in describing the endowment’s grants.

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Prior to these grants, the endowment gave each of the funds $20,000 planning grants to study how they would use the current funding to grow internally. The latest grants are for building their boards, updating technology, marketing, hiring staff such as grant writers and experts in fund-raising.

“We’ve been running a mama-and-papa operation,” said Judy Asazawa, president of the Asian Pacific fund in Koreatown. “It’s like a business. It’s given us an opportunity to get a loan to load up for the future . . . get us into a resemblance of a real organization.”

Ramos, the foremost spokesman for ethnic funds around the country, points to the potential of these funds to make American-style philanthropists of the middle- and upper-class members in the ethnic communities.

For instance, the newer wave of Latino immigrants has raised millions for disaster relief in Latin America but has not been tapped for consistent, strategic giving to a community-oriented organization such as the United Latino Fund, the only one of its kind in L.A., the city with the biggest Latino population in the country.

Ramos says that since Latino entertainers and politicians are active in other forms of philanthropy, why not target them as potential supporters of the fund, which was founded to be the Latino equivalent of the local United Way?

Indeed, such potential is why the California Endowment entered a dialogue with the funds, Wong said. For the next two years the endowment will pay consultants to work with the 11 funds on things such as marketing and fund-raising.

“What we need to do is get that level of philanthropy off the ground, strengthen it and tie it together so that the community work is being done in collaboration,” Reid said.

Jose Cardenas can be reached at jose.cardenas@latimes.com.