Comments on: The Spend-Out Presumption And The Value Of Enduring Institutions http://blog.philanthropynewyork.org/2010/02/26/the-spend-out-presumption-and-the-value-of-enduring-institutions/ Wed, 21 Dec 2011 22:01:01 +0000 hourly 1 http://wordpress.com/ By: Richard Marker http://blog.philanthropynewyork.org/2010/02/26/the-spend-out-presumption-and-the-value-of-enduring-institutions/comment-page-1/#comment-537 Sun, 28 Feb 2010 12:27:32 +0000 http://blog.philanthropynewyork.org/?p=1419#comment-537 Charles, it is interesting to read this piece. In my teaching and advising on this topic, I view myself as neutral either way on the question of spend-down or perpetuity. Yet readers of my book tell me that they perceive a leaning toward long-term/perpetuity.

Some of that, I suspect, is because (as you correctly point out) the current fashion is to downplay the value of perpetuity in favor of spend-down and articulating the other view may appear to be running against the tide.

It is also true that, as a one-time executive on the other side, I learned the indispensable value of endowments, especially for facilities, without which an NPO can be saddled with increasing claims against its operating budget forever.

Having said that, in my advisory work, I am regularly surprised by the leanings of my clients toward one or the other approach. Often these leanings seem to run counter to the pattern of funding or content of their grantmaking. Whatever the objective arguments for or against spend-down/perpetuity, funders often make their decisions on the basis of very subjective preferences about their own legacy, perceptions of their own family’s values, and experience with the organizations with which they have had direct experience over time. It is important, I think, to do as you have attempted to do: to honor the legitimacy of both approaches—if thought through and made with self-awareness.

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