They provide the mechanism for establishing endowment funds. They provide the way to achieve excellent investment yields through pooling of funds. And they provide benefits to the many communities that they serve. A community foundation supports charitable activities for long-term benefit of a defined geographic area. A community foundation seeks new contributions of permanent endowment from a wide range of donors.
Gifts can range from simple cash donations to the giving of one's estate.
Community foundations usually encourage donors to make unrestricted gifts - allowing flexible and broad use of generations of donor dollars for effective community benefit. Using earnings from invested assets, a community foundation functions primarily as a grant-making institution supporting a broad range of charitable activities that creatively address emerging and changing community needs. A community foundation may also provide leadership on pervasive community problems and provide technical advice to area nonprofit agencies. The governing body of a community foundation represents the broad interests of the community. Its members serve limited terms without compensation.