Foundations & Corporations

Key FCR Terms

Capital support | Challenge grant | Endowment | General operating support | Matching grant | Annual report | Community foundation | Corporate foundation | Family foundation | Form 990-PF | Grantee financial report | Independent foundation | Letter of inquiry | Operating foundation | Private foundation | Proposal | Request for Proposal (RFP)

Types of Support
Capital support – Funds provided for endowment, buildings, construction, or equipment.

Challenge grant – A grant that is paid only if the recipient organization raises a specified amount of additional funds from other sources.

Endowment – Funds intended to be invested in perpetuity, with the interest earned providing income for ongoing support of a not-for-profit organization.

General operating support – A grant made to further the general purpose or work of an organization, rather than for a specific purpose or project; also called an unrestricted grant or basic support.

Matching grant – A grant that is given to match funds provided by another donor.

Other
Annual report – A voluntary report issued by a foundation or corporation that provides financial data and descriptions of its grantmaking activities.  Annual reports vary in format and often are included on a corporation or foundation’s website.

Community foundation – A 501(c)(3) organization that makes grants for charitable purposes in a specific community or region.  The funds available to a community foundation are usually derived from many donors and held in an endowment that is independently administered; income earned by the endowment is then used to make grants.

Corporate foundation – A private foundation whose assets are derived primarily from the contributions of a for-profit business.

Family foundation – An independent private foundation whose funds are derived from members of a single family.  Family members often serve as officers or board members of family foundations and play a significant role in their grantmaking decisions.

Form 990-PF – The public record information return that all private foundations are required by law to submit annually to the Internal Revenue Service.  The 990-PF tax form includes information on funder assets, expenditures, grantmaking, and board members.

Grantee financial report – A report detailing how grant funds were used by a recipient organization.

Independent foundation – A grantmaking organization usually classified by the IRS as a private foundation.

Letter of inquiry – A brief letter outlining an organization’s activities and its request for funding that is sent to a prospective donor in order to determine whether it would be appropriate to submit a full grant proposal.

Operating foundation – A 501(c)(3) organization classified by the IRS as a private foundation whose primary purpose is to conduct research, social welfare, or other programs determined by its governing body or establishment charter.

Private foundation – A nongovernmental, nonprofit organization with funds and program managed by its own trustees or directors.

Proposal – A written application for funding, often accompanied by supporting documents, submitted to a foundation or corporate giving program.

Request for Proposal (RFP) – Utilized by government agencies and foundations to announce funding opportunities. The RFP contains project specifications and application procedures and deadlines.