The Ann Arbor Area Community Foundation will provide low-interest loans to local nonprofits.
“We view nonprofit loan-making as an enhancement and supplement to our core grantmaking and scholarship work,” the foundation’s Neel Hajra says.
The “Revolver Fund” will be structured as a donor-advised fund, which affords donors the tax benefits of charitable giving while allowing AAACF to invest the money raised.
A growing number of community foundations are trying their hands at impact investing. The Denver Foundation, for example, has a similar local nonprofit loan fund. A new Virginia initiative called Locus Impact Investing is working to accelerate community foundations’ engagement in the sector.