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Private Philanthropy often reaches on-the-ground responders faster than public funds. Read how disaster relief grants made prior to a disaster can be the most effective form of assistance.
Hurricanes, earthquakes, wildfires, epidemics, large-scale acts of terrorism. When extraordinary events with tragic outcomes occur and dominate the media cycle, the human reaction is to respond with compassion and to try to provide help. However — whether the event happens next door or halfway around the globe — it is not always easy to know how to have the greatest impact or how to get aid to those who most need it. Sometimes the most effective response is to make grants prior to a disaster striking.
There is a particularly important role for private philanthropy in responding to disasters, as private funding is more flexible and can often reach on-the-ground responders more rapidly than public funds can. In addition, private donors can take the long view and think about impact at all stages of disaster response. The Center for Disaster Philanthropy (CDP) and Foundation Center have defined four major strategies for disaster assistance:
In the most recent analysis of giving data, 42% of all disaster giving was specifically aimed at the response and relief phase. Reconstruction and recovery giving increased dramatically from 5% in the previous year to 17%; however, half of that amount was a series of grants from one foundation to address the Flint water crisis. Resilience, risk reduction and mitigation (8%) and preparedness (5%) continue to be underfunded.4 The focus on response and relief is understandable, given the immediacy of images and stories that emerge directly after a catastrophic event, and there is no denying the importance of providing critical services—food, shelter, medical care, safety —as soon as possible. However, the longer-term reconstruction and recovery needs are often overlooked, more expensive, and dramatically underfunded by public, insurance and private funds. In considering a grant in response to a disaster, some key considerations outlined by CDP and other experts include:
The catastrophic impact of Hurricane Katrina on New Orleans is widely known. However, the numbers tell a stark story about the disparities in funding for stages of disaster response. The Data Center, an independent research center focused on Southeast Louisiana, reports that total damages from Hurricanes Katrina and Rita were $150 billion—$135 billion from Katrina and $15 billion from Rita.
Federal spending in response was $120.5 billion. However, of that amount, $75 billion went to emergency relief, not rebuilding. Private giving was $6.5 billion, and private insurance claims covered less than $30 billion of the losses.2
These numbers, taken together, suggest that as much as $79 billion of losses and long-term recovery costs were not covered by any source of public or private donations.3
Although motivated by good intentions, the collection of clothing, food or even water to ship to a disaster-struck area may actually contribute to an inefficient or even dangerous allocation of resources. In 1998 after Hurricane Mitch devastated Honduras, there were planes with vital supplies that could not land because the runway was blocked by bales of donated used clothing, including winter coats, which were not needed.
A disaster expert notes that even bottled water isn’t always the most useful donation. For example, 100,000 liters of water will provide drinking water for 40,000 people for one day. Shipping that amount of water from the United States to West Africa would cost about $300,000. However, a relief organization with portable water purification units can produce that same amount of water for approximately $300.7
Experienced aid agencies have repeatedly stressed the importance of cash donations that allow responders to buy exactly the supplies needed in the quantity and type needed. In addition, to the extent that supplies can be purchased locally, it may help to restart economies that have been hit by disaster.
In making decisions about where to give in responding to a disaster, you should continue to undertake due diligence for an organization before you make a grant. Some questions to consider include:
How we can help you
Because disasters touch every facet of life, and all corners of the world, all donors have opportunities to respond to extraordinary events with compassion in a way that aligns with their values and giving priorities.
We have the expertise and resources available to assist individuals and foundations with giving in response to these events. For more information on this topic, please contact your advisor.8
1 Center for Disaster Philanthropy and Foundation Center, Measuring the State of Disaster Philanthropy 2014: Data to Drive Decisions.
2 datacenterresearch.org/data-resources/katrina/facts-for-impact/ (page retrieved on Aug. 23, 2017)
3 $79 billion derived by taking total losses ($150 billion) and subtracting maximum federal spending ($45.5 billion), $30 billion in insurance, and $3 billion, a high estimate for percent of private funds that were designated for long-term recovery.
4 Center for Disaster Philanthropy and Foundation Center, Measuring the State of Disaster Philanthropy 2018: Data to Drive Decisions
5 Adapted from the Center for Disaster Philanthropy’s post on basic tips for disaster giving; disasterphilanthropy.org/resources-2/basic-tips-for-disaster-giving/
6 Multiple sources, see for example: cbsnews.com/news/when-disaster-relief-brings-anything-but-relief/
8 forbes.com/sites/causeintegration/2015/10/05/charity-scams-put-the-disaster-in-disaster-relief/#1ef7719c6fa2
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