How Southern Power Fund upends traditional grantmaking

The Southern Power Fund wanted to raise at least $10 million to send to grassroots organizations, no strings attached, to address immediate community needs

Philanthropy Southern Power

Clara Benson, founder of a nascent South Carolina nonprofit that connects Black residents with health and wellness resources, got an intriguing call last September.

The caller told Benson to check her email. Her organization, Community Resources for Enduring Wellness, was receiving a grant. The new Southern Power Fund was giving money to Black-led, grassroots groups like Benson’s. The nonprofit didn’t have to apply. The fund already knew about the organization’s work and its potential and wanted to help.

While Benson’s organization, known as CREW had recently received charity status from the IRS it had no budget. Benson had compiled a list of Black mental-health care providers in South Carolina, which she posted on social media. The list was in response to requests from people looking for help coping with the racial inequities revealed as a result of the coronavirus pandemic and the police killing of George Floyd

Benson, then a senior at Rock Hill’s Winthrop University, was majoring in psychology. She was busy with classes when she received the call. There was no rush to open the email she assumed would tell of a grant of “$1,000, if we got lucky.”

CREW needed substantially more money to get up and running.

“$40,000!” Benson shrieked with joy and disbelief after opening the email several hours later. “This took CREW from an idea with a 501(c)(3) to an actual organization that can position itself to get funding.”

Ash-Lee Henderson, co-executive director of Tennessee’s renowned Highlander Research and Education Center, had placed the call to Benson. Highlander is one of the organizations that helped launch the Southern Power Fund as the nation was reeling from the coronavirus pandemic and Floyd’s murder. Highlander, along with Southerners on New Ground, Project South and Alternate Roots, were responsible for distributing the grants.

The Southern Power Fund wanted to raise at least $10 million to send to grassroots organizations, no strings attached, to address immediate community needs. The goal was to quickly get the money to small, primarily Black-led groups, which foundations often overlook. The group planned to develop an ecosystem of grassroots organizations and link them with experts who could help them fill in gaps, such as fundraising skills.

The fund saw the potential to create long-term sustainability while developing a rarely used approach to philanthropy.

The fund exceeded its goal, raising $14 million, primarily from foundations. The Ford Foundation, which gave $4 million through Southerners on New Ground, was the largest donor. The JPB Foundation, financed and led by the philanthropist Barbara Picower, provided $1 million, while the Democracy Frontlines Fund, JPB Foundation, Resource Generation, and the Solidaire Network gave about $1 million each through their donor networks.

So far, the Southern Power Fund has awarded $9.7 million to grassroots organizations. Most of the roughly 250 grants were for $40,000, and beneficiaries received wide discretion in how to use the money.

“It gets the money out of the hands of institutional philanthropy and into the hands of people who actually know what is happening and are doing the work — in ways that are not restrictive,” Henderson said. “There were a lot of intersecting crises and many of the organizations we funded were the social safety net that was literally saving people’s lives.”

Nat Chioke Williams, executive director of the Hill-Snowdon Foundation, which supports nonprofits fighting for social and racial justice, said inherent in the no-strings approach is the drive by Black-led grassroots organizations to have more say in how to use philanthropic dollars. The foundation gave $75,000 to the fund.

“There is resistance of foundations to support social justice, social change, etc., at a level that actually penetrates and does something about the inequities that almost all foundations list in their missions as something they want to change,” Williams said. “What they often support is more aligned with charity that, despite its best intentions, maintains the status quo and doesn’t bring about change.”

Research shows philanthropies routinely fail to fund the types of groups that Southern Power Fund is committed to supporting. A 2020 report by the Bridgespan consultancy and Echoing Green, which provides support to leaders of emerging social enterprises, found nonprofits led by people of color are awarded less grant money than white-lead groups, and the money they do receive has more restrictions on its use.

Last year’s seminal events, which motivated the country to examine the longstanding socioeconomic dimensions of racial inequality, drew attention to the funding issue. Henderson said many people with large funding groups may have been shocked by disparities, but grassroots groups weren’t.

“It was a catalytic moment for philanthropy,” Henderson said of Floyd’s murder. “Philanthropy had to see that we were telling the truth for years. It should be shameful that it took this much cumulative Black deaths to prove to philanthropy that there was a level of crisis that needed to be paid attention to.”

Benson’s group and most of the nonprofits that received support through the Southern Power Fund didn’t have to apply for the grants. Chantelle Fisher-Borne, project director of Out in the South, an initiative of Funders for LGBTQ Issues, provided expertise to the fund, including on nonprofits in the region worthy of support.

“These groups were doing some beautiful and amazing and creative and critical work that is completely underresourced,” Fisher-Borne said. “We just want to move resources in a way that is actually useful to organizers on the ground.”

CREW is using part of its grant to create a database of Black health and wellness providers, an idea that partially grew out of Benson’s personal need for help.

She posted on social media last year about how she had been struggling emotionally. Benson described it as more than feelings of pandemic isolation. The racial inequality that the pandemic and Floyd’s death highlighted brought on her distress.

Benson, who has enrolled in a master’s program in public health, said she was outraged by the health disparity issues raised by African Americans dying of coronavirus at higher rates. When people asked her if she knew of any Black psychologists and other mental-health professionals, she started compiling a list.

She spent several days working on the list, primarily by combing the websites of health systems and other providers in South Carolina. She then posted what she had found on social media.

Now CREW is using the grant, the first it has ever received, to create an online database that will be expanded to include other Black health-care and wellness providers, eventually also in North Carolina and Georgia. Some of the grant will be used to get professional expertise in compiling and designing a searchable database.

“The goal is really to be like the Green Book of public health for Black folks,” she said referring to the guidebook used extensively by Black travelers during segregation to find safe places to eat and sleep.

Latia Curtis of Greenville, S.C., was distraught by last year’s events for reasons similar to Benson, as well as for racial wealth inequality issues. The owner of a makeup and hair service for film, television, and print clients, Curtis said the fledgling CREW resource list has already helped her find a new therapist.

“I wanted a Black woman therapist,” Curtis said. “I had been to a white therapist, who could understand superficially but wasn’t able to empathize and help me find the language to deal with microaggressions and those types of things.”

In Alabama, as in other parts of the country, people were being released from jail last year in an effort to slow the spread of the coronavirus. Once released, they often couldn’t rely on a heavily strained social safety net, according to Rodreshia Russaw, executive director of the Ordinary People Society, or TOPS.

What’s more, Russaw said, people who had lost jobs due to Covid-19 were having difficulty collecting unemployment benefits, and food pantries were overwhelmed. TOPS saw a gap and sought to fill it.

“We wanted to make sure the communities that we serve got what they needed,” she said.

The 20-year-old group based in Dothan, Ala., is using its grant to provide housing, food, personal hygiene products, and social services to 50 people who had been released from prison. The grant is also paying for a staff member to handle the increased caseload at the group, which had revenue of about $535,000 in 2019,according to Internal Revenue Service data.

“One of the greatest lessons of the Southern Power Fund is that it showed us that when you put trust in the hands of the folks that are doing the true work on the ground, we can help our people,” Russaw said.

The Southern Power Fund uses an approach to grant making that doesn’t follow most philanthropic norms, such as an extensive application process and detailed reports on how the funds are spent.

“We have seen firsthand how organizing and advocacy that takes place in the South can transform lives and impact the entire nation,” Jerry Maldonado, who oversees grant making at Ford for projects that focus on specific cities and states, wrote in an email.

Meanwhile, grantees say the trust that the Southern Power Fund showed in making the no-strings funding, motivates them to be meticulous with how they use the money.

Benson, in South Carolina, not only hired an accountant and other professionals, she also is building relationships with more experienced nonprofit leaders in hopes of learning from them. This is the first time CREW has operated with a budget, and Benson knew this novice status left her vulnerable to mistakes.

“I wanted to first make sure I was a good steward of the money,” Benson said. “My main concern was that we are able to do the most with this money to make this organization and this project as sustainable as possible.”

In Alabama, Russaw said her organization takes photographs and videos of activities of grant-funded programs. She and her colleagues then share them on social media as a way of documenting how the money is being spent.

Henderson recalls the pleasant surprise from many grassroots leaders when she called to tell them about receiving the grants last year.

“That was my favorite part of the whole darn thing,” Henderson said.

Many grantees were convinced that the news of the grant was a prank.

“They couldn’t imagine that there was a fund that would have connections to the grassroots and radical legacies and traditions of Southern organizing that really was just giving them money with no strings.”

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This article was provided to The Associated Press by the Chronicle of Philanthropy. Olivera Perkins is a senior writer at the Chronicle. Email: olivera.perkins@philanthropy.com. The AP and the Chronicle receive support from the Lilly Endowment for coverage of philanthropy and nonprofits. The AP and the Chronicle are solely responsible for all content. For all of AP’s philanthropy coverage, visit https://apnews.com/hub/philanthropy.