By AL CROSS
Institute for Rural Journalism and Community Issues
LEXINGTON —
At a time when economic woes and resulting state and local budget cuts have created uncertainty in Kentucky and its communities, a new study reveals vast assets that could be used for the public good in future decades.
In the next 10 years, $72 billion is expected to pass from one generation to another in Kentucky. If just 5 percent of the money were given to non-profit groups, invested and earned a conservative estimate of 5 percent a year, it would generate $180 million annually to improve Kentucky communities.
The figures are much larger 20 and 50 years out: $173 billion and $707 billion, respectively, according to the Transfer of Wealth Kentucky study being released Wednesday by the Kentucky Philanthropy Initiative, which was created to promote and support philanthropy in the state for the public good. The study is posted at www.kyphilanthropy.com.
For Kentuckians, the study should bring “a collective change in the conversation, from what we don’t have to what we do have,” says Judith Clabes, president of the initiative, which is holding the second Kentucky Summit on Philanthropy in Lexington on Thursday.
The study was done by the Rural Policy Research Institute’s Center for Rural Entrepreneurship, based in Lincoln, Neb. It resembles those that have been done in other states and prompted the creation of community foundations as trustworthy places for local residents or expatriates to make donations to help their hometowns.
In Nebraska, a statewide community foundation with affiliated funds serves 227 communities. Jeff Yost, president of the foundation, is among the experts who will speak at the summit. Others include Janet Topolsky of the Aspen Institute, who has worked with many community foundations, and Wendy Smith, author of “Give a Little — How your small donations can transform the world.”
Summit participants will also discuss the 20 percent tax credit that the Kentucky General Assembly passed this year a for donations to qualified community foundations. Such foundations usually have many donors and spend only the earnings on their investments.
The Transfer of Wealth study has estimates for each of Kentucky’s 120 counties and its 15 area development districts. While some regions have more wealth than others, “All regions and counties in Kentucky have wealth and opportunities for inter-generational wealth transfer,” the study says.
The study comes at a time when Warren Buffett and Bill and Melinda Gates have said such “mega-billionaires” should give half their fortunes away, Clabes notes.
“Every individual has the right to do whatever he or she wishes with their hard-earned money,” Clabes says. “Family and church and favorite charities are worthy and right priorities. But, our communities are important to us, too. And if, through advocacy and awareness, we can begin to think of our communities as one of our heirs, there is no limit to the possibilities for economic, community and quality-of-life development close to home, in ways we have yet to imagine.”
