Greater Seattle punches below its weight in philanthropy

Discussion:

“The reality of Seattle’s charitable giving contradicts the illusion that we are one of the nation’s most generous places.”

by Tony Mestres
Special to The Times

We’ve all heard about the many accolades Greater Seattle has earned in recent years. We rank high on lists of Best Places to Live, Fittest Cities, Best Cities to Find a Job and Most Caring Cities. However, we are not one of the most generous cities in the nation, despite a common perception that we are. It’s time to bust that myth.

It’s true that we have generous citizens across all income levels who give and volunteer to support meaningful causes and organizations. Our region is also home to some incredible philanthropists who give on an epic scale, but I’m afraid we are being deceived by the halo effect of these leaders. When you look at hard data, as a community we are punching below our weight (and even below average) when it comes to charitable giving.

A common measure of philanthropy for individuals is the giving ratio. It’s a simple calculation: charitable contributions as a share of total adjusted gross income. According to the Chronicle of Philanthropy’s analysis of 2015 Internal Revenue Service data, the people of Greater Seattle collectively give 3.0 percent of our adjusted gross income. This means our region gives at a rate below the national average (3.3 percent), and even below the state average (3.1 percent). Spokane, despite its slower growth over the past decade, beats us at 3.4 percent.
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Seattle’s giving ratio ties us for ninth place among the 30 largest metro areas, putting us far behind Atlanta and San Jose, which share the top spot at 4.6 percent. We share our ranking with Phoenix, Baltimore and St. Louis, regions that have not remotely realized the economic abundance we have in recent years.

Of course, philanthropy in Seattle brings to mind the Bill & Melinda Gates Foundation’s tremendous impact in improving global health. We think of Paul Allen’s broad portfolio of hometown giving; the Schultz Family Foundation’s work to provide veterans jobs; the Ballmer Group’s efforts to decrease poverty; and the Raikes Foundation’s work to end youth homelessness. We recently saw Amazon’s Jeff Bezos launch a major philanthropic effort to invest $2 billion in housing and preschool education.

Looking nationally, even among ultrahigh worth individuals (with assets of more than $500 million), there is room to do much, much more. According to a new report by Bridgespan Consulting, in 2017 the ultra wealthy gave just 1.2 percent of their net worth, which for nearly all of them is well below the annual return they earn on that wealth.

All of this means that we have tremendous untapped philanthropic potential to address our great challenges and inequities. The United States is already experiencing drastic wealth inequality, and Seattle embodies that reality. According to the Economic Policy Institute, the average income of the top 1 percent in our region is nearly 25 times greater than the other 99 percent.

At this unparalleled moment in our region’s history, the role of philanthropy is more critical than ever. We need to know the reality about our generosity as a community, and not operate under the notion that we are philanthropic simply because great philanthropists live here. Fortunately, we know that if Greater Seattle’s charitable giving rose just to meet the national average (a mere additional .3 percent), we would instantly unleash $150 million to tackle challenges in housing, hunger, education, health care and more.

For more than 70 years, Seattle Foundation has been investing in making our community stronger, and we are committed to increasing racial equity and economic opportunity through our grant-making, civic leadership and strategic partnerships. We work with our philanthropists to help them understand their full generosity potential and match their giving goals with meaningful action. But, we know that it will take much more than philanthropy to truly address our community’s inequities. It will require the public, private, philanthropic and community sectors to collaborate more effectively, convene the right parties and catalyze the strategies to address these problems and their root causes. We are fortunate to have the full range of assets we need to make positive change: Our community is filled with innovative, compassionate people and leaders who care about social issues and challenges.

The reality of Seattle’s charitable giving contradicts the illusion that we are one of the nation’s most generous places. We have in front of us a generational opportunity to close this generosity gap. One third of all charitable giving occurs in December. That makes now the perfect time to take action and realize our philanthropic potential, as individuals and as a community.

Tony Mestres is president and CEO of Seattle Foundation, where he directs the strategic counsel to more than 1,200 philanthropists and oversees grant-making programs to create an inclusive community where all have access to opportunity.