The Endowment issued $300 million in social bonds in early 2021 under The Endowment’s Social Bond Framework.
In 2021, after a period of social unrest due to ongoing racial injustices unleashed by the political divisiveness and the coronavirus pandemic, The California Endowment took out a $300-million social bond to fund power-building infrastructure and advance health system transformation in California.
This was a step forward beyond the foundation’s conventional grantmaking to meet the moment and commit to investing in innovative, long-term solutions. While there is much more to be done, in tandem with our community partners, we have made substantial progress toward realizing the vision of the Social Bond in a historic way.
Planning for the Bond
As part of an overall commitment to racial equity, The Endowment ensured that our investment of the social bond was being led by people of color-led and women-led firms who assisted in the business and financing of the bond.
An internal committee of Endowment staff was established to specifically develop strategic frameworks and a rubric for the social bond. In addition, a select group of community members, consultants and advisory committee members provided their input on grantmaking priority areas.
Through thoughtful planning and collaboration, the TCE Bond Committee worked with the Board of Directors to finalize the strategy frameworks to guide Bond grantmaking.
The Endowment intends to use the net proceeds of the social bond to advance racial justice and health equity in California.
In response to the COVID-19 global pandemic and its adverse effects on nonprofits, along with our nation’s recent awakening to racial injustice, The Endowment seeks to substantially increase the impact of its grantmaking in the coming years by providing new, dedicated support for the infrastructure and institutional needs of grantee organizations seeking transformational changes in health, public education, criminal justice, and community development systems and policies (the “Opportunity Investments”).
The Endowment will further focus its Opportunity Investments in six priority areas to better target resources where they are most needed to strengthen nonprofit organizations.
Supporting organizational infrastructure to sustain civic engagement and develop intergenerational leaders reflective of marginalized communities
Establishing a state-wide grassroots network dedicated to universal health coverage and health systems reform
Health & Wellness
Strengthening public health institutions and community partnerships for health and wellness
Building workforce pipelines that will expand and diversify the health workforce across California
Supporting local systems, and infrastructure to respond to the needs of communities most impacted by the health and economic effects of disasters.
Research & Evaluation
Linking civic leaders with researchers and bringing data, analysis, ideas, and action together for learning and impact.
Process for Project Evaluation & Selection
The Endowment’s leadership and program teams will be responsible for selecting the Opportunity Investments.
Step 1: Proposal Application Process
Grantees and PRI partners will have undergone a rigorous proposal application process administered by program teams that are subject matter experts in their respective fields.
Opportunity Investment proposal applications evaluate prospective grantees based on a number of criteria including, but not limited to, (i) the issues their organization/project addresses, (ii) geographic focus and/or communities and populations their organization/project intends to support, (iii) long-term goals, (iv) existing revenue sources, (v) potential impact, (vi) prior experience, and (vii) diversity goals and efforts.
Proposals for Opportunity Investments will be thoroughly reviewed to ensure The Endowment complies with all legal requirements (including, but not limited to, Internal Revenue Code requirements and U.S. anti-terrorism laws) for charitable giving. The Endowment has designed its grant making process – from preparation of the grant recommendation to processing final reports – to conform to applicable legal standards and The Endowment’s procedures and standards. Opportunity Investments will be monitored by The Endowment on an ongoing basis through visits, meetings, and written reports.
The Endowment will track the net proceeds of the Bonds.
Until distributed, the net proceeds of the Bonds will be held in a segregated account at The Endowment’s custodian bank. Bond proceeds will be transferred, as needed, to an operating account for disbursement. A register will be established and managed by the CFO and his Finance department staff to record on an ongoing basis the allocation of the net proceeds of the Bonds to Opportunity Investments.
The Endowment intends to report on the grants financed through the Social Bonds along with its other grantmaking activities on its website, which will include recipients, location, subject area, and population served.
The Endowment currently reports on its grant-making by listing all of its grants and grantees on its website, updated monthly, as well as Form 990-PF tax filings, with ongoing updates on the work conducted in furtherance of its mission (https://www.calendow.org/).
Information contained in The Endowment’s website is not part of this Offering Memorandum and is not incorporated by reference herein. All updates on the expenditure of bond proceeds are voluntary.
Since issuing the $300 million in social bonds, The Endowment has established social Bond frameworks that will guide our investment. We have completed the beginning phases of planning for the Bond, which included making initial investments and preparing to make investments through our grantmaking process.
Initial grants have been issued to seven collaborative efforts – including:
Center for Community Organizing, Community Coalition for Substance Abuse Prevention and Treatment$6 million for one year
Support multi-faceted community power building to be scaled locally in LA, statewide, and nationally. CoCo is an organization at the center of the Los Angeles ecosystem with a long history of organizing, civic engagement, arts and culture, and resident leadership development in the region.
Bold Vision, Liberty Hill Foundation $5 million over three years
To support a philanthropic-community organization partnership project to strengthen the power building infrastructure in Los Angeles County to advance health and racial justice efforts to ensure that BIPoC youth have the resources and skills they need to thrive.
California Black Freedom Fund – Advancing Health Equity
To support a pooled fund designed to help build and sustain the power of Black-led organizations, coalitions, and networks and bolster the infrastructure of Black-led organizations working to build power, advance health equity and transform inequitable systems across California.
Supporting Drought Resiliency and Economic Stability for Farmworker Health
To support farmworker health through an ecosystem of partners supporting movement building across California and working to build farmworker capacity in rural communities for long-term drought resilience planning, action and structural implementation.
To support an organization that strengthens community organizing capacity and leadership among youth and adults and trains organizers to advance health equity and racial justice across the Central Valley and beyond.
Advancing Public Health Leadership and Workforce In California
To establish and implement initiatives to advance the leadership and collective impact among public health educational institutions and strengthen connections and coordination between schools and programs of public health and local health departments to strengthen the public health workforce in California.
Promoting Climate and Community Resilience via Leadership, Health and Safety
To support efforts to create the first carbon-negative rural/Tribal region in the US by 2030 through accelerating climate resilience development while confronting inequitable health and safety impacts of rapid transitions in the Redwood Coast, Humboldt, Trinity, and Del Norte region.
Alameda Wellness Campus – Advancing Health Access Through Housing
To pioneer a new standard of care for unhoused adults with complex health challenges through the construction of a clinic that will provide short-term housing, recuperative care and health services for 400 unhoused Alameda County residents annually discharged from hospitals who have no safe place to heal.
The University of Southern California Equity Research Institute$2,996,357 over three years
Strengthen California’s ecosystem of BIPOC and community-engaged researchers who are equipped with the skills and capacities to provide data and narrative that bolsters community power and power building for health equity.
Decolonizing Wealth Project – Building Resilience and Health in California
To provide strategic support to over 12 diverse California Tribal land trusts as they further equitable systems and practices for longer-term adaptation, recovery, and rebuilding by applying Indigenous wisdom and land management practices to heal; transition built and natural systems and social infrastructure to be resilient and sustainable; and support community restoration, stewardship, health and ultimately ownership of land, soil and water through community ownership, governance and care.
Community Ownership for Community Power, Possibility Labs$2 million over three years
To provide capacity building and capital infrastructure for communities of color and immigrant communities across California to advance community ownership as a common model for equitable real estate preservation, working towards widespread housing affordability, intergenerational community wealth, and the right to health equity for all Californians.
Climate Science Alliance – Building Tribal Climate Resiliency and Health
To strengthen California’s Native community-driven efforts to further equitable systems and practices for longer-term climate adaptation, recovery, and rebuilding by applying Indigenous wisdom and land management practices to heal landscapes, build climate-resilience workforce pathways and strengthen Tribal governance.
Young Climate Leaders of Color, People’s Climate Innovation$1.5 million for three years
Support the development of Young Climate Leaders of Color, a power and movement building infrastructure that develops, fosters and supports youth of color in California as a new wave of climate justice leaders, innovators and philanthropists working on addressing the root causes of climate injustice and transforming the health of their communities.
Supporting a Community Resilience Campaign for Health Equity
To create a solid, aggressive, focused and diverse public-private-community hub in the Salton Sea region (Riverside County and Imperial County) to coordinate, plan, and advance projects that will increase the competitiveness and readiness of the region to capture public dollars that will strengthen the community’s campaign for health equity.
Designing a Power-Building Movement Infrastructure Center for Health
To support a design process for the development of a power-building infrastructure center to significantly enhance the strategic capacity to achieve transformative change across the movements for health equity and justice in California.
Advancing a System Of Health and Well-Being for All
To support the coordination and facilitation of a robust planning process, inclusive of community engagement, that leads to the development of a framework with strategies for advancing a system of health and well-being for all Californians.
Visioning Hope for Community Health and Wellness in California
To support an inclusive, participatory process that will produce site development options and help catalyze The California Endowment’s broader Hope Village vision to promote improved health and wellness in California communities.
Communicating Health Equity Impacts of Social Bond Work
To support education and communication around The California Endowment’s social bond work, which includes efforts to support power building and transform systems grounded in justice, inclusion, equity and community health.
Advancing Health Equity and Wellness for Resilient Communities
To support cross-departmental planning efforts related to The California Endowment’s social bond, including helping build a strategic framework, priorities and potential investments for resilient communities that aligns with the bond’s priorities and scoring criteria.
Assessing the Power Building Landscape to Improve Community Health
To support a landscape assessment of power building models, structures and functions of a potential thinktank on community power, organizing and leadership that can promote improved health and wellness in California communities.
Supporting Health Through the Development of Hope Village
To support The California Endowment’s leadership in their vision of replacing jail beds with health-related supportive services and housing in Los Angeles by connecting The Endowment to important local- and state-level public and private influencers and investors.
Over the next year, as it embarks on this next phase of the Social Bond, The Endowment plans to continue assessing opportunities to fund transformative work in California.
This will include identifying additional projects the bond will fund, evaluating them against the criteria and working with those partner organizations to develop proposals for approval by the foundation’s Board of Directors.
To learn more about The Endowment’s progress on the Social Bond, click the button below for an update from President and CEO Dr. Robert K. Ross and Board Chair Bishop Minerva Carcaño.
The net proceeds of the Bonds are expected to be used to provide grant funding for Opportunity Investments to organizations, projects, and programs meeting The Endowment’s grant-making criteria or as investments consistent with its Program-Related Investment (“PRI”) process. The Endowment’s target population of existing and prospective grantee and PRI partners are largely dependent on philanthropic funding and thus are particularly vulnerable to operational, employment, and mission disruption as a result of the wider economic slowdown caused by COVID-19 control measures.
The Endowment will have broad discretion as to its use of the proceeds of the Bonds, provided that such use complies with The Endowment’s tax-exempt status under Section 501(c)(3) of the Internal Revenue Code and The Endowment’s classification as a private foundation.
The Endowment will use its three key organizational goal areas as a primary screen in determining which nonprofits will receive Opportunity Investments. This screen will ensure consistency with The Endowment’s goals and program areas that support the movement for health equity and racial justice in California – with a focus on target populations impacted by inequity.
Social bonds are loans contracted from private funding to support new and existing projects that achieve positive social outcomes.
The California Endowment’s Social Justice Bond is a $300-million fund that provides a long-overdue opportunity to invest in much-needed organizational and power infrastructure to advance and sustain efforts to secure health, wellness and racial equity for California and Californians.
Power infrastructure is defined by the Grassroots Policy Project & PIVOT as “The people, systems and resources that provide the underlying foundation or basic framework needed for a long-lasting robust power-building ecosystem for transformative change. It includes the skills, capacities, organizational forms, resources and apparatuses to drive the agenda and build movement power.”
In response to the COVID-19 global pandemic and its devastating impact on communities of color, along with the nation’s reckoning on racial justice, The Endowment seeks to substantially increase the impact of organizers and grassroots groups who are doing civic engagement work on the ground by providing the necessary funding for powerbuilding.
The Endowment’s grantmaking in the coming years will provide new, dedicated support for the infrastructure and institutional needs of organizations in California driving transformational changes in health, public education, criminal justice, and community development systems and policies.
The Endowment’s Social Bond specifically aims to advance social justice – racial and health justice specifically – by way of investing in infrastructure, the health workforce, climate resiliency and powerbuilding to achieve policy solutions that create opportunities for health, wellness and access to healthcare for all.
The Endowment intends to report on the grants financed through the Social Bond along with its other grantmaking activities on its website, which will include:
In addition, we are conducting a formal evaluation of the Bond to assess its near-term and longer-term impact.
Since February of 2021, The Endowment has established a Bond committee, developed a grant assessment rubric, brought on consultants and an advisory committee, engaged directly with communities, partners and other stakeholders while creating strategy frameworks for its grantmaking priority areas.
The Endowment has committed to having 50 percent of the underwriting work supported by BIPOC-owned and women-owned firms – including Black-led underwriting firms Loop Capital and Siebert William Shank who partnered with JP Morgan to move the investor recruitment and execution phase forward.
2020 was a historic time period – the COVID-19 pandemic; the unjust killings of George Floyd and Breonna Taylor (along with many other Black people killed by law enforcement); and the persistence of white supremacy – that unearthed deep inequities in the nation’s systems. The Social Bond represents a dedicated commitment to supporting infrastructure and power-building movements for social justice and health for all Californians. This is not a time for philanthropy as usual – this moment calls for unprecedented action for systemic transformation.
The Endowment’s Social Bond is a commitment to make historic investments in building power and agency in communities and to dismantling racist systems that impede health and civic engagement. Through investing in lasting support, The Endowment seeks to address the ongoing harm of racist policies and practices and accelerate the impact of its partners far beyond traditional grantmaking.
The Endowment will fund organizations, programs and projects that are working toward long-term power-building and infrastructure. This includes “institutionalizing” or “endowing” collaborations that support grassroots community organizing and leadership development, building economic power by investing in the health workforce and strengthening policy and advocacy networks.
After a year of intense planning, The Endowment strategically determined priority areas to expand and strengthen the infrastructure for health, equity and racial justice across California. The Bond funds are allocated and invested across these priority areas:
Health Systems (Coverage, Health and Wellness, Workforce)
Grants from the Social Bond are intended for nonprofit organizations, as well as projects and programs that address racial justice and anti-racist practices. Grantees’ mission, projects and/or programs must also be aligned with The Endowment’s current strategic plan.
Each Bond project will be assessed based on the same criteria:
Yes, initial grants have been issued to seven collaborative efforts – including the California Black Freedom Fund, Latino Community Foundation and Foundation for California Community Colleges. Additional grantees will be announced in May of 2021.
While there’s much more to be done, The Endowment has made substantial progress toward actualizing this vision in a historic way in tandem with community partners and initial grantees. Over the next year, as we embark on this next phase of the Social Bond, The Endowment plans to finalize the frameworks, identify projects the Bond will fund, evaluate them against its criteria and work with partner organizations to develop proposals for approval by the Endowment’s Board of Directors.
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