How do Colorado’s foundations compare nationally?
The selected location of a foundation depends on a number of idiosyncratic factors, but is often connected to wealth (in the case of family foundations) and economic activity (in the case of corporate foundations). In other words, the assets needed to establish foundations typically result from successful business and investment activity and such successes are closely connected to where that activity took place. A foundation’s activity is by no means limited to the state where domiciled. Many foundations, especially larger ones and those focused on a specific issue area, operate nationally and even internationally. At the same time, a reasonable expectation for most foundations is that substantial foundation giving flows into the local community. For this reason, a review of the distribution of foundations and foundation assets across the United States is worthwhile.
Colorado is a relatively wealthy state with the 7th highest median household income (year 2020)[1] and the 16th highest Gross Domestic Product (GDP) (year 2021) among states.[2] Based on population in 2021, Colorado is the 21st largest state.[3] So, how does Colorado’s foundation landscape reflect these state characteristics? Colorado ranks 20th out of all states for the number of foundations per capita with roughly one foundation for each 3,159 residents and more than 1,800 non-operating private foundations reporting assets (as seen in figure 2).[4] The lower the number, the greater the density of foundations in the state. Nationally, there is one foundation per 3,777 residents on average suggesting that Colorado has more foundations relative to its population than other states.
Colorado’s foundation assets total approximately $15.6 billion, which represents the 16th largest amount for a state. While the total assets held by foundations serve as a crude proxy for the ability to give, the relative resources are better understood when standardized to the state’s population. As seen in figure 3, Colorado’s foundation assets per capita of $2,686 ranks 21st among the states which sits above the national median of $1,922, but below the average of $3,008. Due to the large assets per capita in a small number of jurisdictions (like Delaware, Washington, Washington D.C., and New York), comparisons of Colorado to the median asset amount is likely more informative. Related, the presence of one or a small number of the nation’s larger foundations can greatly influence the foundation assets in a state. For example, Arkansas lags other states in the number of foundations (ranking 47th) but ranks 6th in foundation assets per capita due to the presence of multibillion-dollar foundations like the Walton Family Foundation and Alice L. Walton Foundation. While constantly in flux due to investment returns and grantmaking, more than 100 foundations nationally hold assets exceeding $1 billion.
Overall, Colorado’ foundation landscape appears to generally reflect the state’s population and economic characteristics (see table 3 for a summary) although the relatively high median household income and GDP may translate into greater future foundation creation and wealth. An exception is the fact that the median, or middle, foundation in Colorado holds $405,113 in assets, which ranks only 37th among the states. Alternatively, the higher average foundation assets in Colorado of $8,479,388 reflect the influence of the state’s largest foundations on the sector’s total assets.
Examining foundations nationally demonstrates that Colorado is not an outlier in terms of the distribution of foundations or foundation assets (the state-by-state details are available in table A2 of the full report’s appendix). The next section shifts from the national perspective to focus more squarely on Colorado’s foundations.
[1] U.S. Census Bureau, Real Median Household Income in Colorado [MEHOINUSCOA672N], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MEHOINUSCOA672N, June 13, 2022.
[2] U.S. Bureau of Economic Analysis (BEA), Annual Gross Domestic Product in current dollars by State, March 31, 2022.
[3] Annual Estimates of the Resident Population for the United States, Regions, States, District of Columbia, and Puerto Rico: April 1, 2020 to July 1, 2021 (NST-EST2021-POP). Accessed at: https://www.census.gov/data/tables/time-series/demo/popest/2020s-state-total.html)
[4] IRS Exempt Organizations Business Master File (BMF) Extract updated on May 10, 2022 (https://www.irs.gov/charities-non-profits/exempt-organizations-business-master-file-extract-eo-bmf).