Administrative fees are a near universal driver of operating revenues among community foundations, though there are some variances among and within different asset size cohorts. Many community foundations engage in direct fundraising from individual donors to support operations, take distributions from operating endowments, and bring in additional earned revenues by providing paid services such as philanthropic advising for other local foundations or renting out space for local events or other uses. 

This ratio is a shorthand way to refer to the “leanness” of a community foundation’s operating model but is highly informed by several factors such as the local cost of living and the depth of the foundation’s investment in various forms of community leadership. Larger community foundations will achieve an economy of scale that keeps their expense to asset ratios low relative to smaller peers. Across all asset size cohorts, the median ratio increased slightly over FY24 levels as operating budgets increased across much of the field. (n=232)

Larger community foundations tend to have specialized staff roles to serve large, diverse portfolios of donors who may require different levels of service, with additional roles in place to advance mission-driven community leadership efforts. Staff at smaller community foundations often serve multiple roles and are more likely to work directly with a larger proportion of that foundation’s donors. (n=234)

Just under 90% of reporting community foundations said that they have a policy in place to ensure that donors recommend a grant from their DAFs within some agreed-upon number of years. Per such policies, the community foundation housing the DAF may take steps to activate the funds should the donor not recommend a grant within that time. (n=174)

Large community foundations tend to manage larger DAF portfolios than their smaller counterparts, as reflected in the proportion of assets held in DAF accounts across different asset size cohorts.

Averages were used to total 100%. (n=221)

New and small community foundations tend to have relatively high proportions of endowed assets as they look to grow and sustain themselves for the long-term, while larger community foundations leverage their ability to provide flexible options to donors who may want to maintain non-endowed funds they can activate in full at any time.

All but one community foundation said they wait no more than five years to activate DAFs they deem to be dormant, with 97% of respondents saying they take action after three years. In cases where community foundations allow for longer waiting periods, it will usually be for a donor to grow the fund over a longer period to allow for the distribution of larger grants. (n=157)

Nearly all respondents said that their community foundation would attempt to contact a DAF holder to encourage them to activate their fund once the foundation considers the fund to be dormant. Follow-up steps vary but include distributing the fund in alignment with the donor’s original stated intent or transferring the fund to the community foundation’s own unrestricted fund. (n=181)

DAFs hosted by community foundation broadly and consistently maintain high distribution rates compared to other fund types. Nearly half of all community foundations in this sample reported DAF distribution rates in double digits, while roughly 20% reported double-digit distribution rates across all fund types. Large community foundations tend to maintain higher distribution rates as they also carry higher proportions of both DAFs and non-endowed funds than others. (n=366)