Billion dollar benefactors: Minnesota's charitable foundations

Maybe you've heard their names intoned among the sponsors of a public radio program, or seen them acknowledged on the wall of an arts institution or on the back page of a nonprofit's brochure.

But chances are you haven't heard of the vast majority of Minnesota's 1,450 charitable foundations.

That's the way some of them like it, preferring to keep a low profile.

But whether discreet or well known, foundations are crucial members of Minnesota's philanthropic community, collectively shelling out nearly $1.6 billion a year to support education, human services, arts and other worthy causes, about half of them within the state's borders.

Giving away money might sound like a breeze, but actually "it's really hard if you want to make an impact," said Trista Harris, president of the Minnesota Council on Foundations. Foundations, she said, tackle "some of society's most intractable problems. The reason the problems exist is that they're too big for business and government to be able to solve."

Minnesota has more than the average number of foundations, partly because nonprofit giving seems ingrained in the state's character.

"Minnesota is really lucky," Harris said. "It's part of our civic DNA. Swedish and Norwegian folks would say that it was a part of their culture when they came to Minnesota — that sort of collaborative, 'We're all in this together, put in your dollars to make the community a better place.' "

Another factor driving the generosity is Minnesota's unusually high number of corporate headquarters — such as Target, General Mills, Cargill and UnitedHealth Group — placing the state second in the country (behind Connecticut) in the number of Fortune 500 companies per capita. Corporate foundations and corporate giving programs (the former are separate organizations, the latter maintained by companies directly — some companies have both) are philanthropic powerhouses.

In Minnesota, they represent only 9 percent of the total number of foundations, but contribute 47 percent of foundation giving.

The vast majority of the state's foundations — 85 percent — are private family and independent organizations that contribute 36 percent of grant dollars. The McKnight, Otto Bremer, Margaret A. Cargill and Bush foundations are among the more prominent, but there are many smaller foundations with far less familiar names.

A third type of foundation focuses on specific groups or geographic areas. These community foundations, including the St. Paul and Minneapolis foundations and the Women's Foundation of Minnesota, represent 7 percent of foundations and 17 percent of grant contributions.

Although you can lump foundations into these three rough categories, each individual organization has its own mission and projects, said Susan Stehling, the council's communications associate, quoting a former director who liked to say, "If you know one foundation, you know one foundation."

Foundations and nonprofits also are increasingly banding together on particularly complex problems — homelessness or the racial achievement gap in education, for example — which may involve working on a number of different aspects, Harris said.

"No foundation is big enough to solve problems alone," Harris said. "So we have lots of nonprofits working together to solve a specific issue. It's much messier work to support but I think the impact is much greater in the long term."