Private Foundations For the Common Man

On the other hand, proponents of private foundations note, with direct donations or donor-advised funds, you have little or no legal control over what happens to your money later.

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With donor-advised funds, you can only make a recommendation; you cannot enforce it, though it is rare for one of these funds to refuse to carry out the donor's wishes.

And direct gifts, even if there are strings attached, can be tough to control. Currently, the Robertson family, heirs to the A&P supermarket fortune, are engaged in litigation with Princeton University over what the Robertsons claim is the university's failure to use a 1961 gift of $35 million for its intended purpose. That gift is now worth about $900 million.

For those with a charitable bent and a desire to retain control of their wealth, private foundations offer flexibility. They can be combined with such vehicles as charitable trusts so that they can begin operating during the donor's life and then become fully funded at his or her death. For example, a donor can set up a charitable remainder trust that gives him a current tax deduction and an income stream for his life or a period of years at the end of which the remainder of the trust goes to his foundation.

Foundations can be flexible in other ways as well.

Constance Lane and her brother, for example, operate their foundation in two pieces: Constance's in South Dakota and Landon's in North Carolina.

In Rapid City, Constance Lane's fund has given money to a program that provides backpacks for poor children (mostly Native Americans) to help them carry home food from their school lunch. Teachers noticed that the children performed fairly well during most of the week but did much worse on Mondays. Realizing that they were doing poorly because they weren't getting enough to eat at home over the weekend, the teachers appealed to the Lane foundation for help. Now the program has expanded throughout the Rapid City school system, Constance Lane said.

The foundation has also helped start or expand other programs including suicide prevention as well as assistance for the residents of Libby, Mont., a town affected by asbestos from mining operations there.

Libby residents are "on their knees really fighting to keep what they loved there," said Stanfield. "It's very daunting that what they need is far more than what we can provide. . . . Mom came up with [the idea of] training them to learn to request grants on a much larger scale."

"There are lots of opportunities to make a difference out here" in South Dakota, Constance Lane said. "It's extremely satisfying."