Program Officers Blog

Created by Congress in the Tax Act of 1969, a PRI (program-related investment) is a type of mission-related or social investment that foundations make to achieve their philanthropic goals. PRIs can take many forms – deposits, equity investments, guarantees and loans, to name to few.  At MMT, most PRIs have been loans.  
 
Since our inception, we’ve awarded $36.6 million in PRIs.  Use the filter on our Awards Database to see a list of all of MMT’s PRIs.  More than 75% of our PRIs have been made since 2005, when our trustees decided to emphasize PRIs as an investment strategy to complement and supplement grantmaking.    

During our fiscal year that ended March 31, 2011, MMT awarded the highest volume of PRIs than any prior year, both in number of awards and total dollar amount. At the end of the year, MMT’s PRI portfolio was at record levels both in number of organizations supported (24) and total amount outstanding ($15.7 million).  

PRI recipients or borrowers come in many types and sizes – arts and culture, community action, health and human services, environmental, housing, lenders and others.  They range from small to large agencies looking for capital for their own projects to intermediaries that raise and aggregate capital to re-lend to qualifying nonprofits and projects.  A few examples provide a sense of the depth and breadth of the program:

• Affordable Housing: Umpqua Community Develeopment Renovation of Hotel North Bend
• Community Development: Ecotrust's Jean Vollum Natural Capital Center
• Arts & Culture: Liberty Theater Restoration
• Economic Development:  Enterprise Cascadia loan to K-Lyn Fisheries
• Microenterprise:  Oregon Microenterprise Network
• Entrepreneurship:  Enterprise Cascadia loan to Bridgewater Bistro
• Open Spaces:  Pacific Forest Trust land in Cascade-Siskiyou National Monument
• Wildlife Habitat Protection:  Deschutes River Conservancy repairs

Organizations are using PRIs in a number of ways:  acquiring property and developing a facility to operate programs, refinancing debt with savings being reinvested in the infrastructure and projects, increasing stock of (rental and homeownership) affordable housing, preserving land and ecosystems, creating new or expanding existing programs, and producing jobs to build communities, among others. 

The following chart provides a snapshot of our current portfolio by program/focus area. (Click on image to see full size)

MMT's PRI Allocation by Focus Area, March 2011

An increasing number of nonprofits are seeing PRIs as a valuable tool to help sustain their work in a challenging economy and increasingly competitive environment for funding.  While we view this as a positive trend and are hopeful that we receive more requests, we are not suggesting that MMT will be undergoing a wholesale change to emphasize PRIs over grantmaking.  Grantmaking is and will continue to be a powerful tool in our toolbox.

If you are considering a PRI, take some time to review what we look for in a PRI application. Talk to other recipients about their experiences and, of course, you can contact me if you have questions.

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