Sustainability of Giving Circles: Part 1

14 07 2009

By: Hannah Kim

Administrative OverheadIn my previous post “From Concept to Practice”, I had raised the question of how exactly to mobilize capital and human resources to manage any tenant issues, attract and retain investors, manage investment funds, liaise with external partners, and take care of other administrative duties required to keep our Homeless Sponsorship Model flowing continuously.

Indeed, one of our major challenges with the model is covering the administrative costs of implementing the client selection → housing → job placement → self-sustainability process.

According to Bearman’s report for the Forum of Regional Association of Grantmakers (“More Giving Together: The Growth and Impact of Giving Circles and Shared Giving”, p.16), administrative costs of running giving circles can be funded by various external sources, including donations and grants from local community foundations. However, report findings suggest that external grants and donations are not very sustainable.

Another way of covering administrative overhead is requesting giving circle members to contribute additional funds just for that purpose. Of course, keep in mind long-running giving circles’ learning that members are much more hesitant to see their contributions going towards administrative costs than directly to the social cause (p.18).

The challenge of addressing administrative issues is one already brought up by a representative of SHARE Family & Community Services at the Tri-Cities Homelessness Task Group meeting on July 10, 2009. Watch for further posts on our progress in overcoming this challenge!

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2 responses

27 07 2009
Helen

Hey guys,

I think the idea you guys came up with is great! As for the giving circles, maybe you already addressed this question in a different post, aside from donating for the sake of helping out homeless people, have you thought of other benefits that would entice them to keep giving to make your funding sustainable?

27 07 2009
Hannah Kim

Hi Helen, thanks for your question.

The additional incentives we’ve thought of so far for the investor giving circle to make our model sustainable are the follwoing:
– lower mortgage interest rate approved by a local bank or credit union, given that a registered charity (foundation) administers the program;
– lower property tax & utilities fees paid to government;
– price reduction on property unit by a major Tri-Cities developer, provided that the program is run by a registered charity and that positive PR on the price reduction is provided;
– services and materials donations from the local business community for repairing and refurbishing donations, which helps in appreciation of the property value; and
– networking opportunities amongst members of the hands-on investment giving circle where the investors volunteer as a group and interact with homeless clients.

The first three of the above incentives show potential of being feasible, according to the local bank, municipality, and property development contacts we’ve spoken with.

Let me know if you have any other questions. 🙂

Thanks,
Hannah

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