An Overview of The Rotary Foundation

Written by Euan Eddie

At a recent meeting Bill Pope asked a searching question about The Rotary Foundation (TRF) which deserved a good answer. Here is the answer (and a bit more) that I gave Bill which I hope other members of the club may find informative. But, before that, here are a few general facts about TRF:

The Rotary Foundation transforms your gifts into service projects that change lives both close to home and around the world.

Since it was founded more than 100 years ago, the Foundation has spent more than $4 billion on life-changing, sustainable projects.

With your help, we can make lives better in your community and around the world.

Our mission

The Rotary Foundation helps Rotary members to advance world understanding, goodwill, and peace by improving health, providing quality education, improving the environment, and alleviating poverty.

What impact can one donation have?

For as little as 60 cents, a child can be protected from polio.

$50 can provide clean water to help fight waterborne illness.

$500 can launch an antibullying campaign and create a safe environment for children.

TRF is part of the organisation to which we belong – Rotary International. It is our Charity and the one and only Rotary Charity. It is managed from RI Headquarters in Evanston, Illinois, and subject to US Federal and Illinois State Laws. For the last 12 years it has received the highest 4-star rating from Charity Navigator – an independent evaluator of charities in the United States.

A bit like Government, the only money that TRF has is our money. TRF attracts donations from Rotarians and non-Rotarians and distributes these funds, in full, by way of grants to Rotarians to enable them to deliver projects in their communities, locally and internationally, for those in need. Projects must fall within one of seven Areas of Focus – peacebuilding and conflict resolution; disease prevention and treatment; water sanitation and hygiene; maternal and child health; education and literacy; economic development; environment.

Following the start of the war in Ukraine, TRF received donations from Rotarians and non-Rotarians and was able to distribute more than 400 Disaster Response Grants (DRGs) totalling $17.3 million.

District 2232 (Ukraine) claimed three DRGs of $100k each, Districts which bordered Ukraine claimed one DRG of $100k each and all other Districts, including our own D1175, were able to claim one DRG of $25k each. Bideford Rotary received £500 which has been spent in supporting the Ukrainian families who came to, and were hosted in, Bideford.

Projects can be local and supported by a District Grant, up to about £800 in our District, to match an equal contribution from a club, or they can be international, supported by a Global Grant, for a project costing about $40,000 or more, and managed jointly by two Rotary Clubs – one, the Host Club in the location of the project and the other, the International Club, in a different country.

Each year TRF receives about $300 million from Rotary Clubs and other donors, which it retains in its Annual Fund for three years, then releases that full amount for Rotarians’ use. Every year, therefore, TRF distributes about $300 million. Interest from the 3-year investment is used to pay the administrative costs of managing TRF. Each of RI’s 529 Districts receives exactly 50% of the amount it donated three years before, and the other 50% goes into the World Fund, from which all Districts may draw funds to support a successful Global Grant application.

Each District may choose to allocate up to 50% of its returned funds for small District Grants (usually no more than £800 each) and to retain the other 50% in its District Designated Fund (DDF), from which clubs may request financial support for a planned Global Grant project. 80% of the amount awarded from the DDF is added from the World Fund so that a reasonably modest amount raised by a club, or a group of clubs, can be multiplied up to a more significant amount to finance an important and necessary Global Grant project. TRF has no long-term reserves; funds are readily available from DDFs and the World Fund to meet clubs’ approved planned projects.

For example, Bideford Rotary, perhaps with support from its neighbouring clubs, might choose to work as the International Club with a club in an African country (the Host Club), to equip a hospital in its area, with equipment needed to improve maternal and child care, at an estimated cost of $40,000. The project could be funded as follows:

Host Club:

Contribution from Club(s) $5,000

Contribution from their DDF $5,000

Contribution from World Fund $4,000 $14,000

International Club:

Contribution from Club(s) $10,000

Contribution from our DDF $10,000

Contribution from World Fund $8,000 $28,000

TOTAL $42,000

In this way it is possible for a club to support and finance a project costing more than four times its contribution. The DDF and World Fund are not Bank Accounts, so clubs are not restricted to drawing only funds they have already contributed to the Annual Fund.

TRF does receive other donations from Rotarians and non-Rotarians, many quite substantial. These are mostly in the form of bequests to TRF, specified in benefactors’ wills and received by TRF after their deaths. The value of each legacy is maintained in perpetuity, and only the interest they generate may be, and is, spent on Rotary programmes and projects, although benefactors may specify how they would like the interest from their legacies to be spent. At 30 June 2022, TRF’s accounts showed assets of $1.26 billion, but, as already stated, these are retained in perpetuity and cannot be spent.