Grantmaking by small private foundations increased by 24.5% in 2015 over the previous year, Foundation Source reported this week.
The organization, which provides support services for private foundations, based its findings on transactional data of 831 of its more than 1,200 clients.
All foundations in the sample had less than $50 million in assets, as do 98% of all private foundations in the U.S., according to Foundation Source.
The report said much of the increased grantmaking was attributable to the smallest foundations with $1 million to $10 million in assets. These granted 51.7% more last year than the year before.
Grants by foundations with less than $1 million grew by 8.2%, and by 7.7% for those in the $10 million to $50 million range.
“Given the robust performance of U.S. equity and fixed income markets in 2014, we had expected to see an uptick in giving in the following year, but an average increase of more than 50% among some of our clients was even higher than we might have predicted,” Foundation Source chief executive Robert Chartener said in a statement.
The report noted that private foundations are required to distribute 5% of their net average assets from the previous year. Foundation Source clients did better than that, giving away 7.4%.
Foundations with less than $1 million in assets distributed 11.9%, those in the $1 million to $10 million range paid out 8.5%, and the largest ones granted 6.4%.
The report said private foundations’ grantmaking often peaks toward year-end. Last year, 25% of the year’s grantmaking took place in December, much higher than the 19% in 2014.
The findings showed that grantmaking priorities by smaller private foundations shifted in 2015. Education still dominated, accounting for 25% of grants, but this was down from 31% in 2014.
The report did not suggest a reason for the decrease in grants to education.
A report earlier this year predicted that charitable donations to education by individuals and foundations would increase by 6.3% this year and by 6.1% next year in part because of “the increasing interest of donors, and especially wealthy donors, foundations and even corporations, in funding higher education, as well as a growing role for philanthropy in K-12 education.”
Smaller foundations last year increased grants to human services to 17% from 15% in 2014, public/societal benefit to 15% from 12% and health to 9% from 8%.
At the same time, grants to arts, culture and humanities fell by a percentage point to 11%, as did grants to international/foreign affairs, to 7%.
— Check out Wealthy Donors Worry Their Gifts Are Wasted on ThinkAdvisor.