As some of you know, one of my hobbies is photography, and in particular, bird & wildlife photography. The egret you see above was migrating through Linde Shores Conservation area in late August, and put on a great show with 50 of its friends for me right at dawn.
We are very fortunate to live in a part of the world which lies on one of the major North American flyways. While most people in this part of Canada think of Point Pelee in the spring for songbirds, or Aylmer for Tundra Swans, one of the coolest migrations in the fall is the Hawk & Raptor migration which is just starting as I send this newsletter. Over 36,000 magnificent birds of prey will fly over Hawk Cliff, just east of Port Stanley on the Lake Erie shoreline.
If you go, you will also be witness to two charitably-owned environmentally sensitive properties in very close proximity. One is the Hawk Cliff Woods owned by the Thames-Talbot Land Trust, a public land-trust foundation. Its purchase of the property was partly funded by the Ontario Trillium Foundation, an agency of the province which is run as a Public Foundation. The second property is Solitude Nature Reserve, operated by a Private Foundation.
Each of these organizations is doing some fantastic work in preserving the unique natural areas around Hawk Cliff, however, they represent excellent, but different approaches to philanthropy and legacy.
Private Foundation, Public Foundation or Charity?
Charitable organizations are what we normally think of in terms of charities. Charities like the Thames-Talbot Land Trust (TTLT) are run by a board of directors, and have an operational purpose that has a charitable mandate. In the case of TTLT, the mandate of the organization is to preserve environmentally sensitive land and protect wildlife along the Thames River and Talbot Trail.
Charities like the Thames Talbot Land Trust are directly involved in a charitable mission. To qualify as a charity, the organization must be involved in at least one of the following:
Relief of poverty
Advancement of Education
Advancement of Religion
Certain other purposes that benefit the community in such a way that courts have deemed charitable.
The last category is broad, but specific, and fortunately, the preservation of nature is amongst them, allowing the Thames Talbot Land Trust to continue their good work at Hawk Cliff and elsewhere. Like foundations, Charities must disburse 3.5% of their assets annually towards their charitable mandate. In the case of a land trust, this is easily met working to preserve their properties, and towards purchasing new sensitive areas for future preservation.
A Private Foundation is run by a closely held group, where 50% or more of the directors are related. Often these foundations are created upon the sale of a business, as the sale may generate a significant tax bill to the owners. A private foundation is a very useful structure which allows you to generate an immediate tax credit, but then disburse the funds to charity at a later date or over time, allowing one time to determine charitable goals, etc.
Due to the close control of the charity, usually by the originator and his or her family, CRA puts some restrictions on what can be donated compared to other charities, and slightly different reporting.
A public foundation, like the Ontario Trillium Foundation (OTF) is operated, has an independent board of directors who are all at arm’s length. OTF is actually a government agency of the province, which is different than most public foundations, but in principle, it operates in many of the same ways, even though it only has one donor.
Public Foundations grant money to any number of charities. Like all charitable entities, they must disburse 3.5% of their holdings a year to maintain their tax status.
Just because a charity has “Foundation” in their name, doesn’t actually mean they are a foundation according to CRA rules. Foundations generally are grant-providers to other charities, and not involved in operational capacities like registered charities.
How about you?
All of these structures provide our society with excellent benefits – as we see in the case of our examples involving nature-preservation efforts around Hawk Cliff. Most people are likely to donate to a registered charity, but it is always wise to know there are multiple structures you can access to make a major impact in your community.
If you want to learn more about any of these structures, as always, drop me a line at email@example.com
Disclaimer: You are encouraged to seek legal advice prior to engaging in a charitable structure.