A new report from the Foundation Center projects that giving by the country's more than 66,000 grantmaking foundations increased to a new high of $32.4 billion in 2004. The beginning of a stock market recovery and higher levels of new gifts into existing foundations in 2003 were the primary factors for an estimated 6.9 percent rise that reversed two years of modest reductions.

Accompanying the rise in giving was an increase in the number of grants made. Close to one-third of respondents to the 2005 Foundation Giving Forecast Survey reported awarding more grants in 2004 than in the prior year, up from roughly one-fifth of respondents in 2003. But foundations remained cautious about the number of multi-year grants they made and the proportion of capital grants they awarded, increasing them only slightly.

The report found that the stock market rally at the end of 2004 contributed to an estimated 4 percent to 6 percent increase in foundation assets. That was roughly half the gain recorded in 2003, however, and the assets of many foundations remain below the peak levels achieved in 2000. As a result, while a majority of survey respondents indicated that their giving would increase in 2005, fully a quarter said they would reduce giving — a significant increase over the 18 percent of respondents who expected to reduce their giving last year. While the modest rise in assets and generally optimistic economic outlook suggest that foundation giving is likely to increase in 2005, growth in giving is likely to fall below the nearly 7 percent rate recorded in 2004.

"Foundations regained their footing in 2004, but there will be no return to the boom years of the late 1990s soon," said Foundation Center president Sara Engelhardt. "We are likely to see positive but unremarkable growth in foundation giving in the immediate future."

The report also found that in a period of increased public scrutiny of foundations, nearly 57 percent of survey respondents felt that calls for greater accountability and transparency were justified. Community foundation and midsize and larger foundation respondents (those giving at least $1 million annually) were most likely to agree with the demand for greater accountability. By comparison, 17 percent of respondents felt the calls were not justified, with independent foundation and smaller foundation respondents more often providing this answer.

To read the complete report (16 pages, PDF), visit: http://www.fdncenter.org/research/trends_analysis/pdf/fgge05.pdf