Most charitable giving goes to programs that provide a service rather than try to fix the system. But a study of Los Angeles County nonprofits found that spending on advocacy and organizing can yield major benefits for the communities that donors want to help.
The National Committee for Responsive Philanthropy estimated that for every dollar invested in the work of a selection of advocacy groups, there was $91 in benefits to local residents.
"It is far . . . above the kind of bang for the buck that you get when you invest in funding direct services," said Aaron Dorfman, executive director of the Washington-based philanthropy watchdog.
Dorfman said he hoped the report released Tuesday would encourage foundations to consider investing at least 25% of their grant dollars in advocacy, organizing and civic engagement.
From 2004 to 2008, the committee collected and verified data from 15 groups engaged in fighting poverty, improving health and education, defending minorities and other causes. It found that the $75.5 million spent by the groups on this kind of work generated nearly $6.89 billion in benefits to residents.
The report's authors acknowledge shortcomings in their attempt to put a dollar value on advocacy work. The groups studied were often part of coalitions that also contributed funds; policymakers don't base their decisions only on what nonprofits tell them; and not all the results can be quantified.
But independent analysts said the report showed there were tangible benefits to supporting advocacy groups.
"These are the organizations that are working to make sure that money is going to people in need and that it is benefiting their communities," said Elizabeth Boris, director of the Urban Institute's Center on Nonprofits and Philanthropy.
Among the examples cited in the report:
* ACORN Los Angeles helped build a coalition of labor and community groups to push for increasing the state minimum wage by $1.25 to $8 an hour. The change is forecast to generate $2.65 billion in additional income in the county over four years.
* InnerCity Struggle campaigned for the construction of two new schools in East Los Angeles at a cost of $299 million. The first is set to open in fall 2010.
* The Asian Pacific American Legal Center of Southern California, the Coalition for Humane Immigrant Rights and other groups helped persuade state legislators not to abolish programs that provide food, cash and medical aid to legal immigrants.
Close to 3,000 charitable foundations are active in the county, providing grants totaling $2.1 billion in 2007, according to the report. But only a small portion support advocacy work.
"I think often that advocacy can be seen as a controversial thing," said Alicia Lara, vice president of community investment for United Way of Greater Los Angeles, which supports some of the groups in the report. "I'm not particularly interested in funding organizations that are just doing the adversarial, stone-throwing kind of approach."
But she said her organization does not believe it can achieve its poverty alleviation goals without addressing "the big policy issues." Although it does much of its own advocacy work, she said it also gives 5% of its funding to community groups engaged in "problem solving."
Karin Wang of the Asian Pacific American Legal Center hopes the report will encourage others to make advocacy part of their giving.
"Otherwise, you are not addressing the root cause of the problem," she said.