Elevating the Public Dialogue
Minnesota Grantmakers Take New Steps in Public Policy & Advocacy

by Sylvia Lindman

Most foundations in Minnesota and across the country have historically shied away from funding or engaging in public policy work, prompted in large part by strict federal laws. But the tide may be slowly changing, as a small but growing number of the state's grantmakers are taking steps to become more engaged in elevating the public dialogue on issues integral to their missions.

Foundations' new attention to public policy stems in part from a growing conviction in the field about the need to address the source of social problems. After years of seeing problems grow despite generous grantmaking, many foundations are looking deeper for solutions. And devolution of authority from the federal government to the states has brought many issues to the local level.

"Foundations increasingly are realizing there are systemic components of the issues they're concerned about, and addressing issues through organizing and policy advocacy can be very effective," says Steven Newcom, executive director of the Headwaters Fund, a community/public foundation dedicated to social justice.

Pat Cummings, executive director of The Jay and Rose Phillips Family Foundation, offers a simple analogy. In discussing the foundation's grantmaking approach several years ago, the board and staff adopted a faucet-and-mop metaphor. "If the faucet is dripping, do you get the mop or fix the faucet?" she says. "We decided we wanted to fix the faucet. We felt we'd have more impact by trying to affect systems and root causes rather than doing emergency or 'Band-Aid' grantmaking."

"Public policy" generally refers to the principles guiding federal, state and local governments, as well as the practices and regulations of administrative bodies. The question of whether foundations should engage in policy goes directly to their missions. Whether it's to aid the poor, assure a clean environment, support the arts or improve children's opportunities to learn, the mission is at the mercy of public policy.

If, for example, the federal government slashes appropriations for affordable housing, no amount of foundation giving can make up for it. By supporting advocacy for affordable housing -- raising awareness of the facts around the issue -- foundations and their nonprofit partners may increase understanding of the need for affordable housing and overcome some barriers to getting it built.

"A high percentage of social issues (to which) foundations give money to ameliorate are the result of public policy decisions," Newcom says. "Foundations have both the opportunity and the obligation to think seriously about the implications of public policy and its impact on the work they fund and the missions of the organizations they support."

Rip Rapson, president of The McKnight Foundation, agrees. "I think philanthropy is a particularly fertile field for public policy," he says. "No sector is better positioned to seed ideas and invest in underrepresented communities and causes." Last spring, McKnight received the national Council on Foundations' inaugural Paul Ylvisaker Award for Public Policy Engagement for its six-year welfare-reform initiative. In that initiative, McKnight helped develop community networks that have strengthened Minnesota's fragmented social service delivery system, offering not only financial resources but also expertise and information to help people move from welfare to work.

With foundations' endowments falling in today's troubled economy, board members may be particularly reluctant to divert money from direct services to advocacy. "We all understand that foundations are feeling the pinch, but it's more important in tough times than in easy times to support advocacy work, because very hard decisions have to be made in tough times," says Marcia Avner, public policy director for the Minnesota Council of Nonprofits and author of "The Lobbying and Advocacy Handbook for Nonprofit Organizations." "At a time when government is facing significant budget cuts, nonprofits and the people they serve need to have a voice in the decisions. Advocacy is crucial."

What Are the Options?

Historically, "public policy" and "advocacy" have been scary terms for grantmakers. Federal tax law prohibits private foundations from making expenditures that "attempt to influence legislation" and bars both private and community foundations from participating in political campaigns. Many foundations protect themselves by not taking positions on any public policy issues at all.

"Grantmakers often underestimate their ability to participate in the public policy arena," says Gina Kastel, an attorney who specializes in nonprofit law at Faegre & Benson LLP in Minneapolis. "They sometimes fail to distinguish impermissible lobbying from the wide range of permitted public policy activities." For tax law purposes, "lobbying" generally refers to communications regarding specific legislation or a specific legislative proposal.

Because the definition of lobbying is fairly narrow, foundations have numerous ways to participate in public policy. Foundations can fund organizations that do research, education, advocacy and even lobbying in certain cases. They can convene meetings of nonprofits and/or funders around issues. Depending on circumstances and the content of the communication, foundations can submit op-eds or letters to the editor, publish reports and newsletters, develop marketing and advertising campaigns, talk to the media, create Web sites, organize events, establish awards, and even testify at the legislature. Kastel advises foundations to have an attorney review plans for such activities, particularly during campaign season and when specific legislation is pending.

"Minnesota foundations work everywhere across the spectrum," Avner says. "Some understand the ways in which they can fund advocacy and lobbying and will do that through their grantmaking. Some will be partners in designing and carrying out public policy initiatives."

At the more visible end of the spectrum are the large foundations, such as McKnight, which in September launched its most aggressive and comprehensive public policy effort to date — a smart-growth campaign called Embrace Open Space. The foundation and 10 nonprofit partners have been working on the effort for two years and expect the campaign to last a year or two. The tactics include print ads, a Web site, tools for citizen action, articles and publications, and identification of "10 Twin Cities Treasures" — the types of places the campaign is designed to protect.

"This isn't a campaign to slow down growth," Rapson says. "The tremendous economic strength of this region is an asset. But we believe that this region can accommodate anticipated growth by using less land, protecting treasured natural areas, and creating greater transportation and housing choice — in the process saving the public hundreds of millions of dollars."

Rapson adds that the initiative is integrated with the foundation's grantmaking. As with its successful Mississippi River program, McKnight has leveraged the open spaces effort under its Living Twin Cities environmental program by developing a network of advocacy organizations whose collective voice is more powerful than each individual voice. "We encourage advocacy groups to connect with other like-minded organizations and with government resources that can increase their chances of success," Rapson says. "Individual initiative is invaluable, but the constraints of public policy often require work on a larger scale."

The Minneapolis Foundation is another leader in marshalling partners to work on public policy. "Foundations should be engaged in the business of informing and advocacy, hoping the community reaches a reasoned consensus based on factual information," says Emmett Carson, president of The Minneapolis Foundation. "It's not all of what we do, but it's part of our toolkit." He cites two recent efforts where he believes the foundation's involvement has made a difference.

In one case, The Minneapolis Foundation convened several organizations that all were advocating for affordable housing but had not coordinated their efforts. A series of convenings resulted in HousingMinnesota, the first statewide collaborative of housing organizations around consistent messages and themes. "It is now considered the preeminent voice for housing in our state," Carson says. Although state legislators trimmed funds for affordable housing in the 2002 session, housing advocates successfully fought off a much steeper proposed cut.

The second case is the Think Twice campaign, a collaboration between The Minneapolis Foundation and the Minnesota Council of Nonprofits that was launched earlier this year. With nonprofits facing the threat of across-the-board cuts from the state, the partners campaigned for a more thoughtful approach — and succeeded. "Our argument was not that you shouldn't cut any nonprofit but that a cutting-board approach wasn't a nuanced approach," Carson says. "We tried to raise the level of debate and understanding."

These examples illustrate two styles of participation. In the case of HousingMinnesota, the foundation stayed in the background and the nonprofits delivered the messages. In the case of Think Twice, Carson spoke at the Capitol. It's a question of whose voice adds the most credibility, Carson says, adding, "We talk about using our cash and our cachet. We think about how our cachet can help. In the case of Think Twice, it was very important for the foundation to make a statement."

Finding a Niche

No less important are efforts to listen to and provide financial support for those working for change. This has been the mission of the 18-year-old Headwaters Fund from the beginning. "Our focus is on grassroots social justice work, which is not a priority for most other foundations," Newcom says. "We believe supporting community groups addressing specific issues of racial, social, economic and environmental justice is the best way to create change." Headwaters complements its grants for organizing, advocacy and capacity-building by helping to raise the visibility of social justice nonprofits. For example, it hosts an annual Walk for Justice fund raiser (the nonprofits receive the proceeds).

The Phillips Family Foundation has found great satisfaction in its support of policy and advocacy work, Cummings says. In the last two years it has funded some 30 organizations engaged in advocacy, supporting causes ranging from living-wage jobs to affordable housing to reproductive rights.

"It's a more risky kind of grantmaking," Cummings says. "It's not what people generally think about when setting up a new family foundation. But the [Phillips] family has a history of progressive thinking. After Mr. Phillips died in 1992 and the children and grandchildren took responsibility for the foundation, the foundation focused on what I would call conventional grantmaking. However, the more the family learned about local community issues, the more they became convinced that to really make a difference they also had to support advocacy and public policy efforts."

Similarly, the Sheltering Arms Foundation concluded recently that it cannot fulfill its mission to help children overcome barriers to success without engaging in public policy. Specific plans won't be in place until next year, but the direction is clear, says executive director Amy Crawford. "We can only do so much through individual support to grantees," she says, "but there's a role we can play in terms of education and sharing what we know in a bigger way. We can serve as a connector or convener for bringing together organizations that have mutual goals and interests around public policy issues that impact children."

Recent cuts in children's programs at the Legislature "made us really stand up and ask what we can do to be more proactive," Crawford says. "Knowing our grantmaking resources aren't going to grow significantly, we want to find other ways to be supportive and helpful." With a staff of just two, the foundation will work with other funders and nonprofits to develop messages and strategies.

Some Advice

Grantmakers experienced in policy and advocacy work offer a few words of wisdom to those who'd like to get started.

Start small. Foundations don't need to make a splash to be effective, Carson says. "People just need to start. Get your toe wet. Figure out what area you have a passion in and what you can do to get the ball rolling. That might simply be convening people about the issue." A meeting may spark a good idea or two, and those ideas can turn into action.

Build relationships. "To do effective public policy work requires five major activities: research, education, direct lobbying, mobilizing supporters from multiple sectors and media advocacy," Avner says. "Foundations don't often have the capacity to do that internally. They can leverage what they have by working with one or a collective of nonprofits that have those skills." It isn't just a question of capacity, however, she adds: "It's also about the range of voices you want to have pressing elected officials and appointed officials to make critical administrative and legislative decisions. The combination is more effective than either nonprofits or foundations doing it alone."

Stick to your principles. This advice cuts three ways. First, a foundation will have greater impact if its advocacy stems from its grantmaking priorities, where it has expertise and credibility. Second, if it cares about an issue, it will make better grants in that area. "Sometimes it's OK to say we're not neutral on these [social] problems," Carson says. "We want to change them." And third, if it believes in what it's doing, the foundation can accept the possibility that its public actions may invite public scrutiny. If something goes wrong, Carson says, "the institution needs to believe they were doing the right thing, not ask whose fault it was."

Watch for opportunities. Public policy work is often opportunistic. "You can try to build models or create a groundswell of public support, but unless decision-makers are prodded into action or are on the edge of action, these efforts aren't always successful," Rapson says. For the Embrace Open Space campaign, the Metropolitan Council's pending Regional Blueprint for Growth afforded the opportunity to educate the community about the consequences of different growth scenarios. "We've worked closely with the Metro Council to make sure the work we're doing reinforces what they're trying to do," Rapson says.

Have patience. Remember, the system is entrenched, and changing it is long-term work. "In a way this is faith-based funding," Cummings says. "You make your grant to the Jobs and Affordable Housing Campaign and you have faith that this campaign will in fact help to change the thinking of decision-makers around affordable housing and jobs. And maybe five years from now they'll be able to say, 'This is different because we existed,' but you're not going to see it short term."

Be willing to fail. Likewise, Cummings says, not everything will work. Foundations can't focus on the usual outcomes. "You have to change your expectations for these kinds of grants," she says. She mentions one campaign the Phillips Foundation supported to get driver's licenses for undocumented workers. It hasn't succeeded yet and may never be successful, she says, "but in the meantime [the grantee] raised the visibility of the issue, and that has value."

A foundation that sticks its neck out inevitably takes a risk. It might be criticized for trying to set the agenda, for doing too much, too little or the wrong thing. "But I think there's more risk in not doing anything and not sharing what you know," says Crawford of Sheltering Arms Foundation. "It's part of our public role to look at the different ways to be involved and figure out what makes sense for us."

© Copyright 2002 Minnesota Council on Foundations
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