Instead of Being Warehoused, Philanthropy Dollars Should Be Used to Narrow Rural Inequality

The devastating consequences of inequity are playing out right now in rural America. According to a recent study by the Rural Policy Research Institute, COVID-19 is killing rural Americans at twice the rate of their urban counterparts. Native American, Black, Latino and Hispanic communities are also disproportionately at greater risk. Too often the needs of rural America and the imperative to address racial and economic justice are seen in opposition to each other. However, as community foundations that represent geographically and racially diverse communities, we know that these challenges are not mutually exclusive.

We’re calling on our leaders to address rising rates of poverty and systemic racial barriers to health and wealth that have worsened during the pandemic. All these inequities abound in rural America, yet rural places receive the least amount of philanthropic investment. As representatives of rural regions growing more racially and ethnically diverse every day, we embrace the connection we share with urban BIPOC communities. Together, we have the best opportunity to solve the most pressing issues of our time as well as restore the health of our civic discourse. Being marginalized, ignored and dismissed causes the same harm, no matter where you live.

It’s time for a new movement and a new narrative. One that demonstrates the importance of putting marginalized people and places — from Hazard, Kentucky, to Dubuque, Iowa, to Selma, Alabama— in a position to move solutions to deeply entrenched social issues. When we begin to work together more intentionally, there’s real opportunity to affect change across geographic divides — and we may just heal our democracy in the process.  

Rural communities and grassroots organizations led by people of color in rural areas receive far less philanthropic investment than their white-led urban counterparts. Just 7% of all U.S. foundation funding is directed toward rural communities. At the same time, 20% of all people in the United States live in a rural community, and 78% of our country’s high-poverty counties are rural. In other words, the potential for philanthropists to address social challenges by investing in rural America is immense.

To tackle the multitude of existential crises facing our world — climate change, social and economic inequality, and civil unrest — we need to fix the status quo of philanthropy and take bold action today, not tomorrow. Community foundations like ours are deeply in touch with the evolving needs and challenges of the regions we serve. As such, we have the capacity to be nimble and innovative in our work, day in and day out, to help the nonprofits and people most struggling in our communities. Philanthropists have the opportunity to tap into our knowledge, networks, and experience bridging generosity with community needs to accelerate social change in rural America. And those resources are sorely needed.

One effort that offers a first step toward a solution is the Accelerating Charitable Efforts (ACE) Act introduced by Senators Angus King (I-Maine) and Chuck Grassley (R-Iowa), which creates a timeline for charitable assets to be distributed to working charities or postpones any tax benefits until they do. The ACE Act highlights the gross inequity between the billions of dollars being hoarded in commercial donor-advised funds, which grow exponentially and completely tax free, while charitable organizations scramble for resources. It addresses this gap by simply laying out new rules that ensure the money is used for its intended charitable purpose. 

As community foundations grounded in Appalachia, the Black Belt, and the rural Midwest, we think this is a great idea, particularly because the ACE Act has provisions that incentivize donors to give to community foundations. We recognize that there is no silver bullet to tackling the inequities in our society, but the charitable reforms proposed in this legislation are steps in the right direction. In addition to passing the ACE Act, we need policies that incentivize giving to rural and BIPOC-led organizations. The more marginalized and historically underfunded the community, the more incentive that should be given to donors.

While financial firms continue to build and hold onto these “charitable” assets, rural and marginalized communities like ours are starving. We are referred to as “scrappy” and praised for “doing so much with so little.” It’s time for a shift in how these resources flow to places that need them the most. Requiring charitable assets actually go to charitable organizations certainly won’t guarantee more money going to regions like ours, but it is an important first step, and shines a spotlight on the inequity of tax breaks that overwhelmingly benefit coastal white elites.

The communities where we are rooted might seem isolated to our urban counterparts, but the work we and our local partners are doing has deep impact. We also know that simply being “scrappy” isn’t enough to move the needle in a meaningful way. Concentrated wealth and power are more blatant than ever. Lifting up rural America, investing in BIPOC communities, and increasing economic mobility for the most underinvested people and places, has the potential to rebuild our country. Warehousing charitable funds forever will simply continue to harm all of us. 

We are in a watershed moment. How we respond, how we invest, in the communities we’ve ignored for too long, will determine the future of our democracy. Choosing to accelerate giving to BIPOC-led and rural grassroots organizations is our way forward.

Felecia Lucky, President, Black Belt Community Foundation , Selma, Alabama

Gerry Roll, CEO, Foundation for Appalachian Kentucky , Hazard, Kentucky

Nancy Van Milligen, President & CEO, Community Foundation of Greater Dubuque, Dubuque, Iowa