A foundation is a legal category of nonprofit organization that you can find all over the world. This organization can donate funds and support other organizations, or they can provide the source of funding for their own charitable purposes. You can find private and public foundations. The private foundations are typically endowed by a family or an individual.
Short Description
There is a wide diversity of purposes and structures among the different foundations. However, there are some structural elements that are the same for every one of them. They need to have specific legal requirements for establishment, a clear purpose, economic activity, management and supervision provisions, accountability and auditing provisions, provisions for dissolution of the entity, tax status of corporate and private donors and specific tax status of the foundation.
Funding
All nonprofit organizations, especially the public foundations, have different sources of income that help them fulfill their goals and their missions. They have different fees for goods and services, individual donations and major gifts, bequests, foundation grants, corporate contributions, government grants and contracts, interest from investments, tax revenue or membership fees and dues. It has proven to be a good practice to utilize several diverse sources of income to achieve sustainability.
Goals
Being set for the broad-based public benefit of the residents from a given area, a local foundation is there to enhance the quality of life. It’s a broad mission that is carried out by foundations through building permanent endowment funds and also using some of their annual income for supporting a variety of other local nonprofit organization through special projects and grants.
Many of the community foundation assets are held in different funds that are established by local families, individuals, businesses or charitable institutions. There may be a special purpose for each fund, but the foundation board of directors that represents the community will oversee them all.
Differences
All the non-profit organizations have a specific mission. However, a local or a community foundation has a very broad mission – it is there to improve the quality of life in that area. This is translated into the ability to make grants in any field of interest with a charitable benefit to the local community.
This flexibility will allow the foundation to serve a wider group of potential donors but also a wider group of other nonprofit organizations that are considered partners in the task of improving the local communities.
Unlike other foundations, a community foundation will help the money stay in that area. This also benefits other local nonprofit organizations in different ways, and it’s different depending on the goals and the tasks that they deal with.
The community foundations will help make connections between the people who want to give something and the people who need their support.
