By sunsetting, the Douty Foundation makes a strong case for limited-life philanthropy

The board of the Douty Foundation, a 53-year-old foundation best known for supporting grassroots organizations and progressive causes, has opted to sunset and will be closing its doors permanently within the next few weeks as it completes final paperwork tasks.

According to Douty’s Executive Director Jennifer Leith, the sunset plan “has been approved by the Orphan’s Court of Delaware County and that (Douty) can now spend out its remaining assets.”

Jennifer Leith.

In their July 2020 announcement of its sunset, Douty said it would turn any remaining assets “over to an entity(ies) similarly aligned with our mission with the intent that our funds will bolster and further the work of economic, racial & gender justice.”

What that now works out to is nine local organizations will share $1.2 million in legacy grants.  They are Centro de Cultura, Arte, Trabajo y Educacion (CCATE), Community Fund for Immigrant Wellness, Incarcerated Women’s Working Group, PA Domestic Workers Alliance, PA is Ready!, Philadelphia Regional Institute for STEM Educators (PRISE), African Family Health Organization, the Coalition of African Communities and Moder Patshala.

“The organizations selected for our Legacy grants are among the most effective grassroots groups and movements in our region that are meeting the challenges and opportunities in advocating for racial, economic and gender justice.” said Leith, explaining the selection criteria.

But Douty in exhausting its finances also chose Bread & Roses Community Fund to receive their final $1 million.

Casey Cook.

“It will be one of the largest gifts our grassroots organization has ever received, and we will use it to deepen our support for community organizing for racial, social, and economic justice in the Philadelphia region,” said Casey Cook, executive director of the Fund who called Douty’s decision to sunset, “Bold.”

“It’s bold because Douty, in deciding to shut down, is putting money in the hands of community members. It’s bold because when you shift the money, you shift the power,” she added.

Since 1968, The Alfred and Mary Douty Foundation provided funding to nonprofits who worked to provide equity opportunities, especially for disadvantaged youth in Montgomery and Philadelphia counties. It was a radical mission for a radical time, and they sought organizations which were deeply engaged in their community, willing to take risks in terms of programming, had limited access to traditional funding sources, and focused on long-term social change — a perspective shared by Bread & Roses.

“We have been on parallel (grantmaking) tracks for the past 50 years,” Cook said.

However, as the Douty board considered moving deeper into participatory grantmaking, which centers the active participation of constituents in the grantmaking process, they determined that they didn’t have the capacity to make that work and instead opted to close down.

“As a result of its own internal planning coupled with the injustices exposed throughout 2020, the Foundation determined that now is the time to put 100% of its resources into the hands of the communities that are at the heart of this work,” Leith said.

Bread and Roses Community Fund, which Cook said has always been the Douty’s Foundation’s ideological twin, has deeply embedded community engagement in its own participatory practices.  That’s why Cook wasn’t too surprised that they would be called upon to shepherd the spirit of the Douty Foundation into the 21st century.

“We are honored to be part of the Douty Foundation’s legacy going forward,” Cook said.

Douty’s sunsetting is also part of a debate that is growing in philanthropic circles — should funders give away of their money during a certain period of time or should foundations plan to last forever. In other words, do you give out all your money now or dole out smaller amounts of cash forever?

Sunsetting or developing limited-life philanthropies is becoming of increasing interest. While the traditional model has been to last forever, research by the Rockefeller Philanthropy Advisors and NORC revealed about 44% of newer foundations, those started within the past 10 years, are limited-life.  On the other hand, shutting down means removing yourself as a valued partner to community nonprofits after spending decades doing the exact opposite.

Weighing in on the value of shutting down are heavyweight funders like Laurene Powell Jobs, widow of Apple founder Steve Jobs, whose charitable arm — the Emerson Collective — is expected to give away $28 billion within her lifetime. “I’m not interested in legacy wealth buildings, and my children know that. If I live long enough, it ends with me,” she told the New York Times.

The issue is not new but still lacks a definite answer. Julius Rosenwald, part owner of Sears, Roebuck and Company,  created the first limited-life foundation when he established the Julius Rosenwald Foundation in 1917. It is best known for building thousands of free schools across the south for former slaves, a project which according to a 2011 report from Federal Reserve Bank economists found that equalized the academic levels of Black and white students in the south.

There are several contemporary high visibility examples of limited terms including:

• In 2016 the Andrea and Charles Bronfman Philanthropies (ACBP) intentionally closed its doors. In explaining the considerations for spending down, John Hoover then ACBP’s senior VP and CFO wrote that, “The chronological life span of a foundation is a fundamental and critical strategic decision that needs to be driven by donor intent.”
• The Edna McConnell Clark Foundation has declared its intention to spend down its $1 billion endowment in the next decade “to leave a lasting impact on children and families living in poverty.”
• And in September 2020, Atlantic Philanthropies, became the largest foundation to deliberately sunset after make $8 billion worth of grants. That same year, Jeff Bezos announced that the Bezos Earth Fund planned to spend down its assets by 2030.