About Certification: Mission and Structure

BACK: Defining Community Foundations

NATIONAL STANDARDS FOR U.S. COMMUNITY FOUNDATIONS (developed by the Council on Foundations)

II. Mission, Structure and Governance

A. A community foundation is founded and operated for public benefit and has a well-defined, articulated mission.

B. A community foundation is recognized by the Internal Revenue Service (IRS) as tax-exempt under Internal Revenue Code Section 501(c)(3), organized and operated exclusively for charitable purposes.

C. A community foundation meets the public support test set forth in Internal Revenue Code Section 170(b)(1)(A)(vi) as modified by Treasury Regulation Section 170A-9(e)(10).

D. A community foundation has an independent governing body broadly representative of the community it serves.
Explanation: "Governing body" means the board of directors or board of trustees of the organization. "Broadly representative" means that the governing body reflects the diverse composition and different perspectives of the community it serves, and its members are not drawn solely from a single subset of the community.

E. A community foundation's governing body retains variance power by which it may modify any restriction or condition on the distribution and investment of assets, if circumstances warrant.
Explanation: "The governing body must have the power to modify any restriction or condition on the distribution of funds for any specified charitable purpose or to any specified organization if, in the ssole judgment of the governing body, such restriction or condition becomes, in effect, unnecessary, incapable of fulfillment, or inconsistent with the charitable needs of the community or area served. The governing body must be able to modify the restriction without obtaining the approval of any participating trustee, custodian, or agent of the community foundation." (Legal Compendium for Community Foundations, Christopher R. Hoyt, Council on Foundations 1996)

F. A community foundation serves a particular geographic area such as a municipality, county, state, metropolitan area or closely related aggregation of such areas that are considered for some purposes as a community, typically no larger than one state. An organization serving a single greater metropolitan area would satisfy this criterion even if that greater metropolitan area included parts of several states. This criterion excludes national and multi-national organizations.
Explanation: Service to a particular geographic area typically includes grantmaking, community leadership, and service to donors in that identified area. Unrestricted/discretionary funds primarily serve the community foundation's identified geographic area; other grants may be distributedbeyond that area.

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