In March 2020, Ontario declared a state of emergency in response to the COVID-19 pandemic. Like many cities across Canada, Hamilton went into lockdown. Intended to keep people safe, the lockdown also meant that many vulnerable Hamiltonians could no longer access needed services in traditional ways. HCF established the Pandemic Response Fund to support charities working on the frontlines to keep people safe, healthy and connected. These are just a few local programs and organizations we’ve supported over the past several months.
Elizabeth Fry Society
Islamic Relief Canada
L’Arche Hamilton
Refuge Centre for Newcomer Health
Wellwood Resource Centre
Our Future Intended blog is an ongoing series that spotlights some of our most recent granting in areas such as physical activity, Indigenous communities, literacy, food, community theatre, seniors and more.
Even after a 50-year career in teaching, Archie McQueen continues to contribute to the development of young Hamiltonians.
Since retiring in 1998, Archie has been both a supply teacher and a volunteer, running before and after school programs at Benetto Elementary School in north Hamilton. He gives time to other schools as well and his extraordinary volunteering was recognized in 2012 with the Queen’s Diamond Jubilee Medal.
Archie donates his supply teaching salary back to school needs through his fund at Hamilton Community Foundation.
“Small grants from the fund can have a big impact,” he says, noting its recent support to the school’s gymnasium scoreboard and IPads for students. But the fund is also flexible; he can choose other recipients if the moment is right, as it was one year for special needs at his church, St. Paul’s Presbyterian.
Archie’s fund is named for his mother, Grace Baird McQueen and his aunt Ella Baird – sisters who helped put him on the path to success as a young adult. His aunt Ella gave Archie part of a bequest she received from her employers that helped him seed the fund. Ella was in charge of nursing at Westinghouse and had a close relationship with the Myler family who ran the company.
“I wanted to honour my mother and my aunt,” Archie says, “and Hamilton Community Foundation came up as number one to help me do that.” He has been connected to HCF for some 30 years and says it’s a “marvelous organization” that is helping him “shed a little light on what might otherwise remain dark.”
Some of Hamilton’s youngest citizens will have access to much-needed support during the COVID crisis thanks to the latest grants from the Lawyers’ Legacy for Children – Ray Harris Fund.
The Fund recently made grants totaling $19,000 to Essential Aid and Neighbour-2-Neighbour, two local organizations that focus on food security.
Essential Aid focuses on nutrition for children under four and fills a critical gap in the food bank system by stocking a wide range of infant formulas. Infant nutrition needs are unique and many formula-fed babies can’t tolerate a change, but traditional food banks are unable to provide a selection of formula as it is expensive and product donations are difficult to acquire. Essential Aid also provides other high demand items such as diapers, baby food, and children’s hygiene items.
The grant to Neighbour-2-Neighbour will support its critical work for local families, with a focus on food security, access to tutoring programs for children, family supports and a wide range of other services.
Lawyers’ Legacy for Children – the Ray Harris Fund is a permanent endowment fund of Hamilton Community Foundation, which was established in 2006 with a mission to: “collectively inspire and enable children and young people to nourish and develop their knowledge, talents and values in the spirit of community, generosity and responsibility which has characterized the contributions of Hamilton’s lawyers”. To date it has made grants of over $100,000 to local charities to assist children and young people in our community.
“We’re privileged to be able to provide these grants to help address the crucial and ongoing needs that have been intensified by the pandemic,” says Dermot Nolan, who spearheaded the creation of the Fund as a way for Hamilton’s lawyers to collectively help children and young people in need. “Our goal is to help our community provide them with the essentials they deserve to help them realize their dreams and live healthy and fulfilling lives.”
The reality of climate change intensifies the need to support our natural environment. These programs address environmental concerns but also build inclusive communities to ensure equitable outcomes.
Our Future Intended blog is an ongoing series that spotlights some of our most recent granting in areas such as physical activity, Indigenous communities, literacy, food, community theatre, seniors and more.
In Dundas, flooding is more than a headline. It’s prompting action. And Green Venture wants people to see the results.
The environmental non-profit is teaming up with local cycling groups to host a bike tour showcasing half a dozen green infrastructure projects in the valley town, including the Depave Paradise garden at Yorkview Elementary School which replaces pavement with gardens.
Tour participants will learn how the projects use nature-mimicking strategies, such as rain gardens, permeable pavers, rain barrels, trees and naturalized plantings, to increase resilience to flooding and decrease the impact of storm water runoff. A followup workshop will invite community members to identify future green infrastructure projects for Dundas.
The tour and workshop are funded by HCF’s Dougher Community Fund, which supports and enhances programs and services in Dundas.
Excerpt from 2019 Fall Legacy newsletter
Eight young people will be riding high this fall at The Equestrian Association for the Disabled (TEAD), thanks to scholarships supported by HCF.
Located in Mount Hope, TEAD is the only organization in Hamilton to offer therapeutic riding to children and youth with cognitive, physical, behavioural and communication disabilities. Specially trained therapy horses are the main event, while credentialed instructors oversee the programs. The Ron Joyce Children’s Health Centre provides referrals and helps develop individualized riding plans.
Studies have shown that children with disabilities who participate in therapeutic riding experience many physical, social and emotional benefits. The scholarships will ensure that cost isn’t a barrier to participation.
Excerpt from 2019 Fall Legacy newsletter
A new Hamilton Community Foundation impact investment in a renewable natural gas project will help reduce carbon emissions by approximately 110,000 tonnes over the next 15 years.
The project, led by Oakville-based BerQ RNG, will use refining equipment to create renewable gas from organic waste. Like-minded investors The Atmospheric Fund, Verge, and London Community Foundation are also partners in the project.
HCF’s investment reflects an interest in projects that have the potential to be catalytic. BerQ RNG has six additional projects in the works that will result in an estimated 944,000-tonne reduction in carbon emissions. The project could also help to advance effective climate policy by demonstrating the commercial benefits of renewable natural gas over fossil gas.
“This investment exemplifies how we continue to use our assets not only to provide strong financial returns to support our grants to charities, but also to support positive environmental change,” says Annette Aquin, Executive VP Finance & Operations at HCF.
Excert from 2019 Fall Legacy newsletter
When it comes to direct routes from Hamilton to Toronto, swimming isn’t usually the first thing that comes to mind. But for Loren King, it made a good cause a great one.
The Wilfrid Laurier University political science professor is passionate about protecting the Great Lakes. In 2016, Loren took a major step towards that goal by partnering with HCF and Lake Ontario Waterkeeper to establish a fund that supports research, artistic expression and community engagement to protect these waters. That summer, he also swam across Lake Ontario to raise public awareness and underline the importance of the Great Lakes as a heritage that needs protecting.
“It’s hard to overstate the importance of the Great Lakes to Canada. They are a vital part of who we are, and millions of us depend on their waters,” says Loren. “HCF helped us imagine, then establish our fund, and they are a continuing source of inspiration and support.”
Hamilton Community Foundation is pleased to be home to the Great Lakes Trust Fund that ensures a lasting source of support for Loren’s passion.
Excerpt from 2019 Fall Legacy newsletter
When it comes to building relationships with the most vulnerable in our community, lived experience can make all the difference.
The Hamilton Social Medicine Response Team (HAMSMaRT) is a mobile interdisciplinary health outreach service that launched in 2016 with the support of HCF. Since then, the service has provided health care to more than 400 people in Hamilton who struggle with homelessness, addiction and mental illness. The innovative program offers care where patients feel most comfortable, whether that’s at home, in a shelter, on a street corner or at a coffee shop.
This year, a grant from The Milne McGrath Fund at HCF is making an already successful program even better by funding a peer support worker.
Peers are part of the community HAMSMaRT wants to reach. They provide a bridge between marginalized community members and the health-care team, since even the most motivated patients often face barriers, such as precarious housing, that make it hard to stay connected. The peers’ lived experience grants them a level of credibility and trust that takes a longer time to build for traditional care workers.
HAMSMaRT learned the power of informal peer support when it joined Keeping Six, a community-based organization founded in response to the opioid crisis. Keeping Six members with lived experience of drug use connected HAMSMaRT to patients who had been poorly served by the traditional medical community, resulting in successful referrals and treatment.
Now that the peer support role is official, informal connections have been formalized, making relationships with patients more sustainable. “It takes less time for patients to feel comfortable,” says HAMSMaRT co-founder Dr. Tim O’Shea. “Communication is more open and we’re able to deal with their health issues more effectively.”
Excerpt from Fall 2019 Legacy newsletter
Friendly Streets initiative builds community from the ground up
Ask what the phrase “friendly street” means and responses will vary, from safe and accessible to tree-lined and socially vibrant. “A friendly street belongs to everyone,” says Elise Desjardins, one of two co-ordinators of the Friendly Streets Hamilton project. “It’s a space where people want to be.”
Few would describe the streets within a one- kilometre radius of the Hamilton General Hospital in this way, but that’s exactly what Friendly Streets wants to change. Its goals are to improve the journey to the hospital for patients, employees and visitors, as well as the experience of living in the area.
The program, which is jointly run by Environment Hamilton and Cycle Hamilton, started by engaging hospital and neighbourhood partners in 2017 and has continued with support from HCF’s Environment Endowment Fund.
A remarkable amount has been accomplished in a short time, including a Council motion to create a “quiet zone” around the hospital, approval of a new traffic signal on Victoria north of Barton, tree planting, recommendations for wayfinding signage for cyclists, traffic calming, pedestrian accessibility, transformation of an alley into a mobility link, and discussions about changes to bus and truck routes.
“Friendly Streets didn’t come in with a set agenda and just do community consultation as a formality,” says Rachel Braithwaite, a Wellington Street resident and executive director of the Barton Village BIA. “They asked: ‘Community, what do you want?’ And then ran with it.”
Now, Rachel looks forward to a day when she doesn’t have to walk her six-year-old to school beside tanker trucks, and she’s become active in the effort to make it happen. “Sometimes when you see others step up, it encourages you to do the same,” she says.
The leadership shown by the Friendly Streets Community Stakeholder Group, which includes senior hospital administrators, has been a highlight for project co-ordinator, Beatrice Ekoko. “They recognize that a patient’s journey begins long before the hospital doors,” she says. “They’ve become champions.”
“This is a vision of what mobility can be in Hamilton,” Elise concludes. Beatrice adds, “We all have a right to a friendly street.”
Excerpt from 2019 annual report
Donations to the Foundation are invested for the long term in public markets and in alternative investments. Investment income is then allocated annually to support granting, community leadership and operations. The summary and charts presented here provide both a financial snapshot and a history of recent activity that underlies the grants and community leadership activities represented in this annual report, made possible by remarkable donors.
Donations to the Foundation are from individuals, corporations and other charities. Donors may contribute to named endowment or flowthrough funds, to the Board-directed Community Fund, or to HCF’s community leadership projects.
The $35.1 million in donations this year is the second highest total in HCF’s history. Annual donations are influenced by the timing of the realization of donations in wills and significant one-time donations like the $27.7 million in donations of property and private equity. As illustrated in Chart 1, annual donations have ranged between $3.2 and $35.1 million over the past eight years. The five-year rolling average of donations ranges from $5.0 million to $13.3 million over the past eight years.
The five-year rolling average number of donations is 1,787 with 2019-20 at 1,853. The number of donations fluctuates based on “in memoriam” donations and the number and nature of events sponsored by donors to raise money for their funds.
Chart 1
Grants are made annually from both endowed and flowthrough funds. Because flowthrough fund balances are distributed in a shorter time period, granting from these funds can materially influence HCF’s total annual amount granted.
As illustrated in Chart 2, grants and community leadership project spending over the past eight years has ranged from $4.7 million to this year’s historic high of $11.5 million. Granting from endowment funds was reduced in 2013 as a result of the decline in investment returns in 2012 which a) lowered the asset base used for the granting calculation (currently four percent of the fund balances), and b) resulted in less income available to grant. Flowthrough granting and expenditures on community leadership projects has ranged from 22 to 56 percent of total granting in any given year and is dependent on the timing and nature of flowthrough and project activity. At 893, the number of grants for this year is 37 percent higher than the eight-year average.
Chart 2
Investments traded in active markets are reported at fair market value. Investments not actively traded are recorded at their cost less any impairment of their value.
To support our strategy of aligning our assets with our mission and to provide a more diverse and robust portfolio, HCF has committed to investing in alternative asset classes including loans to charities and not-for-profits, private debt, real estate, infrastructure and private equity. These alternatives are consistent with the Foundation’s long-term investment horizon and liquidity requirements. Since these investments are not actively traded, they are valued at cost in the investments. These alternatives total $25.8 million.
HCF invests according to policy guidelines established by the Board of Directors. Two committees of the Board oversee investments to ensure compliance with the policy:
As an endowment builder, HCF’s policy focuses on long-term investing and is supported by reserve accounts that are currently at their policy maximum.
The investment policy sets out a total portfolio target asset mix, as well as a range around these targets. The public market investment managers have mandates within this targeted asset mix and use their discretion to invest the portfolios within this range. Chart 3 reflects the current and target asset mix. Note: $25 million of private equity relates to a fund established by a donor and is not part of the asset mix or the consolidated portfolio results.
Chart 3
Two long-term portfolios are invested in the public markets with Jarislowsky Fraser, and Connor, Clark & Lunn. Chart 4 compares those portfolios against benchmarks as follows:
Benchmarks reflect the performance of each market index based on HCF’s specific target asset mix. Comparing actual results to the benchmark measures the value added by investment managers compared to the average market performance. HCF’s investment policy target is a long-term investment return in the 6.5 to 7.5 percent range.
Chart 4
The effect of the global pandemic has materially affected investment returns, resulting in a -8.4 percent public market return for the year. The seven-year annualized return at 6.8 percent is within the targeted investment policy range and is 1.2 percent higher than the 5.6 percent benchmark. As noted in the financial highlights, the current 10-year annualized return of 7.0 percent is in the target range and is higher than the benchmark by 1.2 percent.
Impact investments enable donations to endowed funds to drive positive change beyond granting, because they represent investments of capital that deliver financial returns coupled with positive social and/or environmental outcomes. In addition, these investments provide a pool uncorrelated to the public markets which, in turn, buffers the portfolio from the volatility currently experienced.
More than 15 percent of our long-term assets are in impact investments. Chart 5 illustrates HCF’s impact investing progress over the past five years, with $25 million currently placed or outstanding and another $15 million committed. This brings the total commitment to $40 million, up from $34 million last year. Impact investments cover areas including affordable housing, arts, environment and sustainable development.
Chart 5
Local loans since inception total $9.7 million with $7.1 million outstanding at year end. Chart 6 shows the impact areas our loans have supported. Since the loan program’s 2012 inception, $2.6 million in loan principal has been repaid and recycled as new loans. In addition, the interest from these loans supports HCF granting.
Chart 6
IRP is a Government of Canada program being delivered nationally by partners including Community Foundations of Canada. As the first phase in the government’s long-term investment in social finance, the IRP’s goal is to make social-purpose organizations “investment ready” so they can make a difference in new and innovative ways through their participation in the social finance market. HCF has partnered with community foundations in London and Niagara, and the McMaster Innovation Park to manage the program regionally on behalf of Community Foundations of Canada. The first request for proposals for funding in January created enormous interest nationally and garnered 65 submissions to our regional partnership. Approved funding is expected to be released in June 2020. As an additional benefit, the IRP brought a growing number of potential opportunities for local loans to HCF’s attention.
These investments include private equity, private debt and real estate investments. Many of these investments are long term in nature, are maintained at cost and do not have a regular income stream. As these investments are maintained at cost, their results include interest income and realized gains, but not unrealized gains. Results for these investments are closely monitored and are reported when realized. Chart 7 identifies the investment areas, with $18.0 million placed and a total commitment of $33 million across 21 investments.
Chart 7
Operating expenses for the fiscal year ended March 31, 2020 total $2.5 million and were 2.5 percent higher than last year. Staffing costs related to the Foundation’s 22 employees represent 70 percent of HCF operating costs.
In addition to breaking out cost by type, operating costs are allocated to each of the Foundation’s operating areas: grants administration, community and philanthropic leadership, community relations and knowledge dissemination, development activities, and administration and governance. Examples of community and philanthropic leadership include convening around the city’s critical issues and fostering the growth of philanthropy by sharing staff time and knowledge to support other charities. Charts 8 and 9 illustrate these costs by operating area and by expense type.
Charts 8 and 9
The Foundation’s annual development expenses are not necessarily attributable to the donations received in that year. The nature of donations to the Foundation can result in costs preceding the receipt of the donation by several years (for example, donations through wills). As a result, consistent with the community foundation sector, operating costs are evaluated by a ratio of total operating expenses to average total assets. Ratios fall within a range depending on the size and stage of the community foundation’s development.
Management considers the ratio of 1.26 percent (1.25 percent in 2019), as illustrated in Chart 10, to be within an acceptable range for a foundation of HCF’s size, stage and level of community leadership, compared against benchmarks established in the community foundation sector. We continue to monitor both the actual results and the benchmarks on an ongoing basis.
Chart 10
Hamilton Community Foundation’s total assets of $201 million at March 31, 2020 include balances of HCF funds and funds held on behalf of others at $1.7 million.
Hamilton Community Foundation’s fund balances, illustrated in Chart 11, represent accumulated donations plus the net investment earnings on these donations, minus granting and operating costs. Funds include both endowed and flowthrough funds. Endowed funds are held permanently and grant from investment earnings. Flowthrough funds are fully distributed as grants over a pre-determined term.
Chart 11
The fund balances have grown 55 percent to $198 million at the year ended March 31, 2020 from $128 million in 2013. Donations of $35.1 million included $4.4 million in flowthrough donations that were largely distributed as grants in the year and, as a result, do not remain in the fund balances at year end. This results in a modest total funds balance growth of 4.8 per cent for the year. The number of funds has grown 19 percent to 377 from 318 in 2013.
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