Snow works with foundations, helping families develop donor intent statements, strategic grant programs, collaborative giving efforts, governance structures and succession plans. Previously, she spent over 10 years with The Pew Charitable Trusts, a foundation with assets of $4 billion. She talked to Judith Schoolman about the difficulties faced by non-profits.

1. What's happening in the charitable/philanthropic sector?

I've been in the philanthropic scene since the early 1990s, and this is really an unprecedented period. According to an industry survey, the average foundation has lost 28% of its endowments. In 10 years, maybe they'll get back to 2007 levels, based on 10% returns. Why? The economic downturn has strained non-profits' infrastructure, and now 100,000 non-profits might go under. There's also an unprecedented demand for funds from social service organizations. On the other hand there's a potential influx of stimulus dollars. A lot of non-profits qualify for this money.

2. How does a foundation differ from a donor-e advised fund?

A donor-advised fund makes relatively modest charitable investments. The account might be housed in a public charity, overseen by the board of the charity. You have to get an OK from the board. So, you have an account in someone else's charity. You might get a list of mutual funds to invest in. A charitable foundation has its own board and a financial advisor, who helps the foundation call the shots.People are not aware that a private foundation or non-profit is sometimes less expensive than running a donor-advised fund.

3. What are some of thedangers e ofestablishing a charitable foundation in these times?

From my perspective, this is the best time. Needs have never been greater. It's our equivalent of the 100-year storm. For individuals starting a foundation or non-profit, there is a diminished need for tax deductions during a downturn because there aren't so many highly appreciated assets. There may be slowed growth of new foundations, but they haven't stalled. There are always people out there having major capital events, such as business sales and inheritance. Dangers? I suppose if the stock market continues to fall and you're 100% in equities, you will lose. So, you start small to manage the risk.

4. What are some of the taxbenefits of a foundation?

Right now, stocks in a foundation's portfolio are viewed using the fair market value. So, you don't pay a capital gains tax when you use the gain for charity. There is a small excise tax on income and capital gains, 1% to 2%. Regarding changes in the future, President Barack Obama floated a proposition to reduce deductions for high-income earners. But there was not much enthusiasm, to say the least. So, it's unlikely there will be any changes in the near future.

5. What's the best way for foundations to weather the storm?

There are competing priorities for foundations to weather storms, or to support struggling individuals in tough times. Some foundations have increased payouts to needy organizations. Other foundations have placed a premium on maintaining the endowment. To do this, they cut the fat—operating costs, travel, conferences—so money goes only to those in need. And, you can make loans rather than grants. A no-interest or low-interest loan to an organization is counted toward the 5% distribution requirement and borrowers pay back the loans. You can also look at the investment portfolio as a way to support the mission of the foundation. With the 95% you don't have to give away each year, you can invest in the social good, according to the foundation's mandate.