By Judie Steeves - Kelowna Capital News Published: November 27, 2008
There will be nearly $750,000 less available to help community groups do their work this year because of the plunge in interest earned from investments this fall. And worsening economic conditions suggest the situation will not improve soon. The impact of that loss in grants and income from endowment funds held by the Central Okanagan Foundation will send ripples through every corner of the community, from arts and cultural activities, to assistance for social service groups, children, seniors and the poor. Without any income this year from its $14 million fund, the COF has warned that for the first time in 30 years it will not be making a grant distribution this year, explained Stafford McKergow, who just stepped down from his term as president at Monday’s annual general meeting for the foundation. “We saw it coming. But, it’s a slippery slope if you begin to dig into your capital and we’ve even eroded that to some extent.”
However, he says there’s been an amazing response from the community, with some fund-holders coming forward to support particular projects with flow-through funds. As well, a couple of firms have come forward with $15,000 each, McKay and Partners and Pushor, Mitchell, to help groups through this difficult time. Board members and other individuals have also already donated $35,000. McKergow said the foundation hires professionals to manage its funds. Currently it’s CIBC Wood Gundy, but that contract has just expired, so the COF will be looking at proposals from other firms. Despite the economic downturn, he said the foundation’s goal is to increase its capital fund to $20 million by 2010, as $3 million was added this year despite the economy, he noted.
Without an income, however, he said groups will have to be more resourceful. “It’s an opportunity to do some introspective thinking, to look outside the box,” he added. COF executive director Leanne Hammond Komori said the foundation is entirely dependent on income from endowment funds, and they’ve received nothing this year. “No one predicted the scope of what happened,” she said. Hammond Komori said she has been working with donors to provide some flow-through funds this year in order to have a spring granting cycle, and she hopes to be able to provide some emergency funds for some of the groups who received nothing this fall. “Social service groups are probably the most impacted. Some of those help low-income families and kids. The need is up, yet the funds are down, and they’re often not as diversified in their funding as other organizations,” she said. Even the United Way, which is an umbrella fund-raising society, will be impacted because its operational expenses are paid through the COF so it can focus on raising money to give to organizations in the community, noted Komori. “This could cripple them operationally,” she said.
In addition to grants and income from targeted endowments, the COF administers the City of Kelowna’s community social development grants, grants to address the sexual exploitation of youth and emergency grants, but those won’t be affected because they are funded by the city’s budget. Previous grants under that program have gone to groups such as the Kelowna and District Society for People in Motion, New Opportunities for Women and the Elizabeth Fry Society.
The COF isn’t alone in its predicament. The Vancouver Foundation, which makes grants in this area as well and is the largest foundation in the country, distributing $60 million in 2007, has announced it will distribute at a rate of five per cent for the remainder of 2008.In a prepared statement, the Vancouver Foundation this week stated: “Given the tremendous volatility in the markets, the board will need to monitor our investment situation and will decide in December if there are enough funds available to pay out these grant requests.”
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