Resources You Can Use
Legal Question of the Month with Remy Barnwell, Staff Counsel
Question: We have been following recent rulings impacting diversity, equity, and inclusion (DEI) efforts. In particular, challenges to DEI programs under Section 1981 of the 1866 Civil Rights Act. Has there been any guidance on funding around DEI efforts that the Council on Foundations has released or that is available to discuss in light of the filings and recent rulings?
Answer: The Council is certainly monitoring pending cases brought under Section 1981 of the Civil Rights Act of 1866 that may affect philanthropy—especially the Fearless Fund and Hello Alice cases. But the Fearless Fund and Hello Alice cases are pending in the 11th and 5th Circuits respectively, and any 11th circuit decision would only be legal binding on that jurisdiction (Alabama, Georgia, and Florida) while a 5th Circuit decision would only be binding on the 5th Circuit (Texas, Louisiana, and Mississippi).
It is helpful to know that the majority of these actions allege a violation of Section 1981 of the Civil Rights Act, which is a claim that rests on the existence of a contract.
To mitigate potential risk, we advise that any identity-based funding or grantmaking be reviewed so that it bears as little resemblance to a contract as possible. Most grants already lack sufficient consideration to qualify as a contract, but another way to deepen the valley between your grants programs and the definition of a contract is to make the distribution without strings attached (i.e., remove any requirement, expectation, or request for performance as a condition of receiving the grant).
In sum, your foundation can and should continue doing any diversity, equity, and inclusion work that it is doing, and we at the Council will continue to monitor the legal landscape and provide any updates if there are any legal changes in one circuit or several.
Council members are encouraged to send any legal inquiries to legal@cof.org.
Practice and Purpose of Policy
CFLeads and the Council on Foundations are partnering to offer a new public policy and advocacy training course for community foundations. This updated training will provide community foundation leaders and staff with the knowledge and resources needed to excel in advocating for the nonprofits and communities doing the hard work of social change. The training will be held over two days, July 30 and August 6, from 1:00p.m. to 5:00p.m. ET each day. Register for Practice and Purpose of Policy today!
NIL Collectives and You
Can foundations work with or grant to Name, Image, and Likeness (NIL) Collectives? Do these student-athlete support organizations serve a "charitable purpose" in the eyes of the IRS? Our new publication, Considerations for Working With 501(c)(3) NIL Collectives, provides the background you need before you get started. And remember, members are encouraged to reach out to our legal team with specific questions.
Philanthropy Exchange Conversations for You
News Articles
Upcoming Events
New Member Spotlight
