Good afternoon,

What you need to know this week: a new executive order aimed at federal grant making, foundations are spending down to meet the moment, the high potential of a midlevel giving program, and more.

— Andrew Simon, editor-in-chief

AP

• Expanded influence: Late last week, the White House issued an executive order that could give the administration a tighter grip on the federal grant-making process, reports Alex Daniels in the Chronicle of Philanthropy.
• Contested issues: Each federal agency will have a politically appointed designee to ensure that the grants “demonstrably advance the president’s policy priorities.” Grants, the order said, shall not be used to fund, promote, or encourage any racial preferences, or proxies for racial preferences, a belief that “sex is a chosen or mutable characteristic,” illegal immigration, or any initiatives that “promote anti-American values.” The order also gives agencies carte blanche to terminate grants.
• The final say? “This executive order is an effort to change the playing field,” said Lisa Stone, a lawyer who specializes in helping companies and nonprofits navigate the federal grant-making process. “Plan B is to move the fight to regulations.”

• See the sunset: When Bill Gates announced in May that his foundation would close in 2045, he cited “too many urgent problems” as one reason. Other foundations are taking a similar approach, reports Alex Daniels in the Chronicle, including the Leon Levine Foundation, which has $2 billion in assets and announced last month that it plans to go out of business in 50 years.
• A response: The first six months of the Trump administration have sparked both political and financial considerations for foundation leaders. According to Nicholas Tedesco, president of the National Center for Family Philanthropy, many families in his network have wondered whether they should support “a government that has a self-expressed disavowment of investment in social infrastructure” by paying excise taxes and should instead spend their philanthropic resources as quickly as possible.
• By the numbers: Hard data is difficult to come by, but a survey conducted this year by the center found that 13 percent of responding foundations have limited lifespans, up 4 percentage points over the last time the center did a similar survey, 10 years ago. Notably, more than a quarter of the 524 foundations surveyed are actively considering a time limit, Tedesco says.

• Support system: Foundations and other grant-making groups continue to offer grants and other short-term assistance to nonprofits struggling with federal funding cuts, reports the Chronicle’s Stephanie Beasley, who’s been tracking these emergency funds since the early days of the administration. Some of the initial funds have closed, but others have been created or reopened in recent weeks.
• The long game: Rather than just focus on urgent needs, funders like the Boston Foundation are now providing money to help grantees consider long-term options, like merging with other nonprofits or winding down their operations. “We’re thinking about how to protect these institutions and help them think about how they might change their business model,” says Orlando Watkins, vice president and chief program officer at the Boston Foundation.

• Going mid: During a time of government cuts, rising prices, tariffs, and economic volatility, it’s not surprising that nonprofits turn to major gifts as a way to fill funding gaps. But, according to reporting by the Chronicle’s Rasheeda Childress, midlevel donors — for many organizations, people who give $1,000 to $10,000 annually — can help fundraisers bring in additional money faster than a push for major gifts.
• Create loyalty: Midlevel donors can help provide consistency, says Alia McKee, a principal at Sea Change Strategies, a consulting firm that has released research reports studying midlevel donors. Major donors may give a gift once or twice, but midlevel donors tend to be steady, reliable, long-term supporters who keep giving — important during times of great uncertainty. “They’re extremely loyal,” McKee says. “Many of these donors have been giving for 10 or more years. They have very high multi-year retention rates.”
• Circle up: Among the insights from fundraising experts for launching a successful midlevel program: Pick the right name. “I would definitely focus on the word circle,” says Paul Yeghiayan, a senior consultant at the Benefactor Group, a fundraising consulting firm. “The reason for that is you want to signal exclusivity without it being elitist.”

• A positive vision: “Those fighting to protect democracy often struggle to tell a clear and motivating story about why it matters,” write Eric Friedenwald-Fishman, creative director and CEO of the Metropolitan Group, and Shannon N. Green, president and CEO of Philanthropy for Active Civic Engagement in an opinion piece for the Chronicle. Within philanthropy, this leaves many leaders grappling with how to invest in pro-democracy efforts “while building a positive vision people can support.”
• Something to agree on? The authors note that Americans might not be as divided on democracy as you think. According to a new national poll including Democrats, independents, and Republicans, “89 percent agreed that our country was built on the right to have our voices heard, make our own decisions, be treated fairly by the justice system, and vote in free and fair elections.” However, Democrats and Republicans interpret the concept of freedom differently. “Democrats gravitate toward the idea of ‘securing freedom and fairness for all Americans,’” write Friedenwald-Fishman and Green, “while Republicans lean toward ‘having a say in the decisions that shape your life.’”
• The fix: The authors argue that funders looking to protect democracy can support nonprofits in their messaging about democracy, help establish resource centers, and build national networks across movements.

• A Harvard settlement: The Ivy League university could soon reach a $500 million settlement with the Trump administration, reports the New York Times. The potential agreement arrives after months of attacks on Harvard and higher education. In April, Trump fueled rumors that the administration was looking to revoke the tax-exempt status of certain organizations by saying, “Tax exempt status — I mean, it’s a privilege. It’s really a privilege, and it’s been abused by a lot more than Harvard.”
• Tumult at Sierra Club: The Sierra Club’s board of directors voted to terminate the employment of executive director Ben Jealous on Monday, reports Politico. In an emailed statement sent to the Chronicle, Jealous wrote, “It is disheartening, unfortunate, but perhaps not surprising that the board has chosen an adversarial course that the facts so clearly cannot support. I have begun the process under my contract to fight this decision. I am confident that we will prevail.”
• A new leader at Barr: Ali Noorani will be the next president of the Barr Foundation, replacing Jim Canales, who announced that he would step down earlier this year. Noorani is currently the director of the U.S. Democracy Program at the William and Flora Hewlett Foundation.

“If funders think that they are scared, they should think about how their grantees are feeling. They need to know that we’ve got their backs.”

— Joe Goldman, president of the Democracy Fund, in an opinion piece by Carroll Bogert for the Chronicle about how funders can protect grantees — and themselves — from civil society attacks

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