Could Gustav Trigger Funding to Fix What Ails Louisiana? Philanthropy Changing Ways of Giving to Disaster Recovery

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Are U.S. philanthropists ready for another crisis? Experts weigh in on the how philanthropists are reacting to Gustav ~ by revisiting the lessons from Katrina on recovery funding and with new innovative financial mechanisms. The silver lining in the storm cloud is that funding for Gustav might finally address the problems that New Orleans and the Gulf States are still feeling from Katrina.

Many effects of Katrina are still unaddressed. Gustav may bring some of the funding to recover the city from both storms.

As the nation watches the storm dissipating, all sit in hope for the Gulf States. Yes, national agencies and state and local officials have seemingly spruced up their act, and the nation wonders if philanthropists will be ready to step in today and help out in the right ways? Philanthropy expert Eric Kessler weighs in on the concerns of philanthropists in the wake of this latest disaster.

"Katrina served up lessons for all: philanthropists want hand in how their funds were being used. Our research showed that donors were giving less because of their lack of confidence in how the assistance was being delivered. With Gustav, philanthropists want to be sure they're helping out in the right ways," says Eric Kessler, Principal and Managing Director at Arabella Philanthropic Investment Advisors, who also has served as the Disaster Response Resource Lead for the Council on Foundations.

The vast majority of individual, family, institutional and corporate philanthropists mobilize some level of support in the wake of disasters, with total giving averaging $1 billion a year in cash contributions, not including significant corporate in-kind giving. The majority of that disaster recovery funding is directed toward immediate relief, with just a small fraction for long-term recovery.

"The bulk of immediate recovery funds from Katrina have dried up, but there's still recovery required," Kessler comments. "Many effects of Katrina are still unaddressed. Gustav may bring some of the funding to recover the city from both storms."

Is there any silver lining in the storm clouds? "Since Hurricane Katrina, donors have begun to expand efforts to invest in the long-term recovery gap." Mr. Kessler goes on to say, "As important as it is to get funds to the field quickly, donors are realizing that they need to use the same level of due diligence on recovery organizations as they do in their regular grant-making. There is an important responsibility to ensure the funds are used effectively, efficiently, and to the desired end." That realization has paved the way for innovative funding mechanisms, including pooled funds like Arabella's non-profit Disaster Recovery Fund.

Arabella offers advisement on how to transform philanthropic dollars into results. "Donors should review their historical giving for disasters and then plan so that they can respond to disasters on short notice without sacrificing their other priorities. As importantly, philanthropists should establish relationships with international aid groups and donor advisors who can ensure that their investments for Gustav yield the results they want to see from their giving."

Arabella Philanthropic Investment Advisors (http://www.arabellaadvisors.com) is a national strategic advisory company with offices in Washington DC, Chicago and New York. They serve institutional, corporate, and family foundations, as well as high-net worth individuals with insights on how to transform philanthropic dollars into results. Clients include: The Bill and Melinda Gates Foundation, Hyatt, Microsoft, Pew Charitable Trusts, and many others.

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