At least a hundred and twenty charitable foundations received loans from the federal government's Paycheck Protection Program (PPP), NPR reports. 

Based on additional data recently released by the Small Business Administration, NPR found that more than $7.5 million was loaned to foundations through the program, including a number linked to some of the wealthiest individuals in the country. Recipients of the loans include the Joe W. and Dorothy D. Brown Foundation ($175,510), which was founded by a Louisiana oil tycoon, and the Niswonger Foundation ($200,529), founded by an aviation entrepreneur, as well as the Walt Disney Family Foundation ($146,700), the Robert Mapplethorpe Foundation ($103,200), and the Letters Foundation, aka the Sunshine Lady Humanitarian Grants Program ($268,800), which was founded by investor Warren Buffett's late sister Doris and is sunsetting at the end of the year.

Other foundations on the list include Anverse Inc. ($611,300); the Fred and Clara Eckert Foundation for Children ($253,100); the Richard Diebenkorn ($157,380), Garfield ($167,157), and Willard G. Pierce and Jessie M. Pierce ($156,400) foundations; and the Peter and Elizabeth C. Tower Foundation, which contributed to the Western New York (WNY) COVID-19 Community Response Fund in March.

Some of the foundations told NPR their investment portfolios had suffered in the spring and they were looking to avoid selling assets at a loss to cover budget shortfalls. The Letters Foundation, which is funded by Doris Buffett's personal holdings of Berkshire Hathaway stock, saw its portfolio lose "considerable value" in March and applied for a PPP loan to "safeguard staff positions," executive director Tyra Sidberry told NPR; the foundation plans to return the loaned funds. 

The Walt Disney and Robert Mapplethorpe foundations said their assets, items such as Disney collectibles and Mapplethorpe photographs, are largely illiquid and cannot easily be turned into cash to cover budget deficits, and that accepting PPP funding allowed them to avoid staff layoffs and furloughs. Mapplethorpe Foundation board president Michael Ward Stout noted that with so many art galleries closed by the coronavirus, the foundation lost numerous opportunities to generate revenue this year. "I think that we were very justified in applying for and accepting this money," he said. "I really do."

While applying for and accepting the funds was not illegal, some nonprofit experts questioned the public perception of tax-exempt private foundations receiving taxpayer-subsidized loans when they had the option of tapping their own assets to cover their expenses. "I think it's a problem for them to take federal money, for sure," said Alan Cantor, a New Hampshire-based nonprofit consultant. "I struggle to get into the mindset of these individuals who are wealthy enough to set up private foundations, and then too cheap to reach into their pockets to keep things going when times get tough."

"[A]t at a time in American society when we are wrestling with big questions of trust in institutions, stories like this can increase the divide," said Jeff Williams, director of the Community Data and Research Lab at the Dorothy A. Johnson Center for Philanthropy at Grand Valley State University. But Williams defended the decision of some foundations to take PPP funding. "We collectively thought we were facing the second coming of the Great Depression," he said, so "it's perfectly logical for a foundation, especially when they watch their assets do a 30 or 40 percent dip, to be rightfully concerned that if they used foundation assets to cover payroll, that's selling into a downturn and eating into their corpus."

(Photo credit: National Institute of Allergy and Infectious Diseases via Rawpixel)