Addressing Philanthropic Blind Spots

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SOURCE: US Census Bureau American Community Survey. US Treasury CDFI Fund Hope Policy Institute Analysis

Philanthropy has a rural blind spot (SSIR Spring 2021).   According to Robert Atkins, Sarah Allred, and Daniel Hart, the distance of the wealthiest philanthropies, which are often located in large metropolitan areas, from practitioners and potential grantees serving rural areas plays a role in the documented disparity between investments made in urban- versus rural-focused organizations. Rural organizations also contend with the misconception that urban areas have higher rates of poverty than rural areas; however, while the overall population is lower in rural areas, 78% of our nation’s high poverty counties exist in these places.  The lack of rural-focused research and active journalistic reporting from harder-to-reach rural areas further hides the need for greater investment in these places.  Due to lower staffing levels, under-served rural communities apply less frequently for funding, further obscuring them from the view of funders. The risk of using limited resources to apply for uncertain rewards makes rural-based organizations pause before competing for funding when solicitations include urban-centric language and criteria within applications. Though unintentional, this philanthropic lexicon creates yet another barrier to rural applicants.

Through over 40 years of supporting local nonprofits in Appalachia, Fahe has witnessed these challenges among our Members. From our Network’s ongoing collaboration with the Partners for Rural Transformation (PRT), many fellow rural advocates have also come to understand philanthropy’s rural blind spots as well. Twenty-one million people in the US live in persistent poverty counties. Perhaps nowhere else in the US is the structural exclusion by race and place more self-evident than in these counties. Of the 395 persistent poverty counties, eight out of ten are rural. When one considers 60% of the residents (source: Transforming Persistent Poverty in America) living in these persistent poverty areas are people of color, the overlap between rural blind spots and equity blind spots becomes apparent, revealing a contribution to inequity that these same foundations are dedicated to eradicating.  

We also see a blind spot to the existing capacity in rural places that leads groups to undertake “rural learning journeys” to find out how to invest and build capacity in these regions. We believe in the power of these types of learning journeys, but there’s no need for funders and investors to do it alone.  Seeking out and collaborating with organizations already connected to local leaders on the ground greatly reduces the amount of time between planning and taking action. However, an often-heard belief of “there is no playbook for what works in rural areas” fuels the desire to journey alone instead of seeking out experienced guides. This deficit-based approach glosses over the preponderance of other kinds of wealth (intellectual, social, and the like) in place due to the numerous proximate leaders  and long relationships represented by the Fahe Membership and groups such as HOPE, Owesta, RCAC, cdcb, and Communities Unlimited—Fahe’s national allies in PRT. Changing the narrative for philanthropists is key to driving investment toward rural places; when we replace the belief that capacity is lacking, and instead shift focus to building capacity that will attract capital, we can begin to alleviate the burden that decades of disinvestment has placed on the residents of our nation’s rural areas.

Fahe knows there is a playbook for rural because we wrote it. For over 40 years, we have achieved tremendous impact in one of the hardest-to-serve areas of the country while receiving a disproportionately lower level of philanthropic support in comparison to wealthier parts of the country.  From 2010-2014, grant making in Appalachia, the Mississippi Delta and the Rio Grande Valley was around $50 per person – well behind the national average of $451 and $4,096 in San Francisco. Over our history, we have grown the size of our network from a handful to over 50 Members across six states.  Every year, these local practitioners grow in size and scale of impact through collaboration and knowledge-sharing thanks to the playbook we’ve written together. The only thing constraining their growth is disinvestment, not a lack of need, insight, or capacity. In Fiscal Year 2021, we made a network investment of $278M, which served over 90,000 people. We have a proven system that works in Appalachia, and our partners in PRT have proven systems that work in regions of persistent poverty across the country. The platforms needed to deliver investments and opportunity into hard-to-reach rural communities have been built and are ready to be engaged; we simply need more gas in our tanks.

Fahe also knows firsthand that a shared learning journey with established local leaders can catalyze impact and opportunity. The Robert Wood Johnson Foundation (RWJF) took Fahe and PRT up on this offer, and together, we are four years into a journey that has provided not only insight for the funder, but which has also helped launch a $1B Persistent Opportunity Fund.  Thanks to their support, in two short years we have raised over $275M that has been invested in some of the nation’s hardest-to-reach rural communities, and we have successfully elevated the needs of rural persistent poverty areas so they are now being included in federal policies and executive orders. RWJF is also helping to breakdown false narratives and changing the conversation around persistent poverty areas through their participation in the Voices for Economic Opportunity Grand Challenge, which is providing grants to groups like PRT to elevate the stories of real people living in the communities we serve.  Robert Wood Johnson’s experience so far has led them not only to place substantial and transformational investment in PRT but to also collaborate in crafting thoughtful solutions while providing the types of support, insight, and connectivity to national conversations only a foundation with their expertise and assets can.

If philanthropy wants to make a real change in rural areas and eliminate “blind spots” that leave rural families and communities behind, then they should join forces with groups like Fahe and PRT.  Our local leaders have achieved astounding, transformative impact with limited funding; with more funding and investments, they could scale their impact towards eliminating persistent poverty, creating greater inclusion, and ensuring rural families and communities are not left behind. We invite funders and investors embarking on, or stuck in, a learning journey of rural or persistent poverty areas to travel with us.  There is no need to spend time and money trying to reinvent something that already exists and already works—funders can create impact and deliver opportunity in rural communities today by working with Fahe and our fellows in PRT.  By investing the time and money to work alongside local leaders, we can fast track a truly transformational level of investment, opportunity, and equity to rural places that will take generations to achieve on our current trajectory.

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Sara Morgan
Sara Morgan
Sara Morgan has worked for over twenty-five years to improve the economic strength of Appalachia. She is an expert in financing housing, infrastructure, community facilities, nonprofits, and community development.

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