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Published in Print: May 21, 2003, as Education Philanthropy Does Little Traveling Abroad

Education Philanthropy Does Little Traveling Abroad

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Charity Begins at home. But does it end there, too?

That's the question facing U.S. philanthropies that support education, which tend to channel most of their money to American causes. Giving to groups in other countries, they've found, is neither an easy decision for foundations to make nor process to carry out.

International Page

Nowhere was the lack of interest in providing largess abroad more evident than at the most recent conference for education grantmakers. A standing-room- only crowd attended the session on how foundations can help schools implement federal education requirements. But the panelists nearly outnumbered the audience at the session on international giving.

Still, making grants abroad is not an entirely foreign notion to U.S. foundations.

In fact, the share of total grant money from American foundations that went to support foreign interests nearly tripled, from 5 percent in 1982 to 14.7 percent, or $2.46 billion, in 2001, according to the Foundation Center in New York City.

International education-related giving has followed the same trend. The Ford Foundation, which bestows millions of dollars each year on higher education institutions and scholarships overseas, started focusing more on precollegiate education in the late 1990s.

"It's evolutionary," said Alison Bernstein, the vice president of the New York City-based philanthropy's knowledge, creativity, and freedom program.

"Previously, the [education] systems were not as widespread, and we didn't see a way of entering into it," she said.

For its 2003 fiscal year, the foundation granted more than $80 million in its foreign education and scholarship program. Roughly a third of that money supports precollegiate education. A lot of the foundation's work in K-12 education overseas is devoted to improving teacher education programs, Ms. Bernstein noted.

Selecting the best area to support "is like a puzzle with people making different choices," said Michael Gibbons, the associate director of the Banyan Tree Foundation, a small, Washington-based philanthropy that supports basic education programs in Africa, India, and Nepal.

Meanwhile, 200 million school-age children worldwide do not go to school. And many of those who do don't get beyond the 4th grade. Aside from humanitarian reasons for providing education to children around the globe, U.S. educators and policy experts hope that educated populations will go a long way toward eradicating disease, poverty, and the political oppression that often breeds animus.

"The general magnitude of the problem is immense," Mr. Gibbons said.

Complicating Factors

Most U.S. philanthropies are parochial, according to John Harvey, the executive director of Grantmakers Without Borders, a Washington-based group that advocates more charitable giving abroad and helps philanthropies meet government regulations for doing so.

"Folks tend to fund in their community, region, or nation," he said.

William Porter, the executive director of Grantmakers for Education, located in Portland, Ore., pointed out that many philanthropists "have made money in America and want to give back to areas where they live, or issues that have made an impact on them."

That connection with community is exactly what led the Eden Prairie, Minn.-based ADC Foundation, an arm of the Internet broadband company ADC Telecommunications Inc., to make grants in Australia, Canada, the Irish Republic, Mexico, and the United Kingdom.

Even though those countries are far from the neediest, the foundation has its reasons for choosing such locations. "Our company has a presence in those countries," said William Linder-Scholer, the executive director of the ADC Foundation. "We want to be good corporate citizens there as well as in the United States."

Some of the grants the foundation has made internationally include three to improve school buildings in Juarez, Mexico, where the corporation has a production facility.

Officials of the foundation, which is financed by the corporation, hope to expand overseas their existing giving in support of math, science, and technology education programs in Minnesota.

But doing so requires significantly more time and energy than giving at home.

When companies or foundations want to give abroad, they face barriers, according to Mr. Linder- Scholer.

Not the least of them are two federal tax requirements: "equivalency determination" and "expenditure responsibility."

First, a foundation must make a good-faith effort to determine that the nongovernmental organization it wants to underwrite would be considered a nonprofit if it were U.S. based. To do so, the foundation must look into the organization's past work, or examine its legal, financial, or founding documents.

In that way, the Internal Revenue Service makes sure that the grant dollars, which are not taxed, are "not going for private gain but public good," said Mr. Harvey of Grantmakers Without Borders.

After grants are made overseas, foundations must meet the "expenditure responsibility" requirement. That means making sure the money was used appropriately—a task made more difficult by distance, language, culture, and foreign countries' own regulations or customs.

Such steps include getting reports from grantees detailing how the money was spent, and completing additional tax forms for the IRS.

Those requirements "often intimidate grantmakers and discourage them" from giving internationally, said Rob Buchanan, the director of international giving at the Council on Foundations, a membership group in Washington.

To comply with the federal requirements, foundations must find effective organizations overseas conducting the kind of work that meets the philanthropies' criteria. They must also communicate with people who speak different languages and must navigate sometimes-vast cultural differences.

Further complicating efforts to support education overseas is America's newfound focus on guarding against terrorism.

To make sure that funds are not used to support terrorist groups, the U.S. Department of the Treasury suggests that a philanthropy check the backgrounds of a group's board members and subcontractors, and examine its banking relationships. Moreover, the foundation needs to check the Treasury Department's listing of groups that U.S. concerns are barred from financing.

"This is clearly putting grantmakers in a very difficult position, because they don't have the resources to do all of this investigating," Mr. Buchanan said.

Big Changes

Foundations do have other choices, though. Instead of doing all the legwork themselves, they can give money to nonprofit groups based in the United States that already work elsewhere.

Some of those organizations have found that relatively small grants can produce big changes.

For example, the American Himalayan Foundation, a nonprofit organization in San Francisco, donates $10,000 a year to pay for a school for 150 Tibetan children in Pokhara.

And the Glimmer of Hope Foundation, a nonprofit organization in Austin, Texas, spent $30,000 to construct a 700-student school in Ethiopia.

With a one-year, $15,000 grant from the Firefly Foundation in Santa Cruz, Calif., a nongovernmental organization in Chipata, Zambia, was able to train 20 students to be peer educators, feed 500 children at a local school, and train 20 adults to care for orphans.

Intermediary organizations are another vehicle that charities can join with to give overseas without ever leaving their own shores.

Improving the educational opportunities and welfare of children is the driving force behind one such group, the Global Fund for Children.

"Because of high population rates, governments can't keep up with growing infrastructure," including the educational needs of its children, said Maya Ajmera, the founder and executive director of the Washington-based fund. That's where nongovernmental organizations can help, she added.

One program her organization underwrites builds "platform schools." Teachers hold classes on train platforms in India, where many homeless children beg for money.

Money from the philanthropies that work with "brokers" like the Global Fund is put to work in countries all over the world where people are coming up with imaginative solutions to problems, Ms. Ajmera said. "We don't believe in geographic borders."

Coverage of cultural understanding and international issues in education is supported in part by the Atlantic Philanthropies.

Vol. 22, Issue 37, Page 8

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Correction: 
This story incorrectly stated that a session on how foundations can help schools implement the requirements of the "No Child Left Behind" Act of 2001 and one on giving overseas took place at the same conference. Those sessions were held at different conferences.

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