Approaches to foundation spending have too often been organized around a false choice. Foundations are expected to preserve assets in perpetuity while spending at or near the IRS-required 5% minimum, or to spend down by deploying resources over a fixed period and closing.
Both paths can be thoughtful and mission-aligned, with perpetual foundations offering long-term support across generations and spend-down foundations choosing a finite horizon rather than allowing resources to remain concentrated indefinitely. We are not arguing against either path, but asking whether treating them as the only options has become too limiting for the decisions foundations face now.
We believe there is another way.
We call this other way the “tidal foundation,” a model that lives outside the limits of perpetuity and spend down and frees foundations to think more expansively about how resources respond to mission, time, and changing conditions.
The metaphor matters because tides rise, recede, and replenish in relationship to the forces around them and the shores they touch. A tidal foundation treats stewardship not as a fixed decision about duration or payout, but as a living practice of calibration. It asks how resources should align with the communities our missions call us to support and the critical periods when increased funding can make a meaningful difference.
A tidal foundation treats a foundation’s corpus not as something to keep safely moored, but as a resource that gains purpose through movement. Capital can flow steadily, rise in periods of heightened need or possibility, and return to replenish before the next surge. Rather than constant expansion or contraction, this is a practice of disciplined responsiveness.
That responsiveness is often constrained by the assumptions around the 5% minimum. For many foundations, 5% has become a proxy for fiduciary responsibility, while spending meaningfully above it is treated as a step toward institutional depletion. Leaders and trustees may want to spend more, but financial modeling can trigger fear that increased spending means choosing a path to closure.
Financial models help boards understand tradeoffs, test scenarios, and plan with care. But they are built on assumptions about markets, returns, spending rates, and time that cannot fully account for changing conditions, opportunity, or the realities foundations exist to address. Models should inform decisions without defining the outer limits of responsibility.
New York Foundation offers one example. Founded in 1909 as one of the first private foundations in the United States, NYF has spent above 5% for decades, often in the 6-8% range, increasing to 8-10% between 2020 and 2025, with plans to spend 10-12% over the next three years. At various points decades ago, financial modeling suggested the Foundation should have been depleted by now, but here we are.
More importantly, that higher spending allowed NYF to stand with communities and movements in key periods when organizing and collective power were needed to shape a more just future. The lesson is not that previous modeling was wrong, but that it is only one input among the many factors foundations should consider when determining how resources can best serve mission.
Marguerite Casey Foundation is asking a related question from a different position of scale. In June 2026, MCF announced a commitment to give at least $500 million over the next decade, including at least $50 million a year in grants and more in strong market years. This represents a 50% increase over its prior decade average. The year before, MCF gave more than $100 million by dipping into its endowment to support leaders and organizations working for racial and economic justice as communities and civil society organizations faced growing attacks. That decision led MCF to ask how large a foundation’s endowment should be in relation to its mission.
Together, NYF’s long-term spending history and MCF’s recent commitment point to a broader approach to stewardship. For larger foundations especially, the question is not only how long resources will last, but whether the balance between what foundations hold and what they deploy reflects what mission, movements, and opportunities for transformation require.
These ideas are part of a broader reimagining of philanthropic norms. Dimple Abichandani’s work on foundation spending policy, first outlined in “A ‘Balancing Test’ for Foundation Spending” and expanded in her book “A New Era of Philanthropy,” argues that spending decisions should weigh mission, urgency, opportunity, and financial considerations together rather than defaulting to formula.
Glen Galaich adds another lens in “CONTROL: Why Big Giving Falls Short,” challenging the donor control that shapes whether resources move to communities facing pressing needs. The tidal foundation builds on both by asking a related question of foundation identity and the role a foundation’s corpus should play in advancing mission.
Where perpetuity prioritizes institutional survival and spend down prioritizes a timeline, a tidal foundation begins somewhere else: with mission, changing conditions, and the communities and movements foundations were built to resource.
That shift changes the questions boards and leaders ask. What if foundations began not with how much they must preserve or pay out, but with the balance between what should be held and what should be deployed to meet mission with integrity? What if foundations treated how much to give and how large to become as a moral question about mission, timing, and responsibility, not only a financial calculation? What if payout were treated as a range, allowing spending to rise when mission requires more and opportunities for transformation are within reach?
These questions challenge the habit of treating institutional continuity as the highest expression of responsibility. Lasting presence and replenishment can be valuable, even necessary, but preservation cannot become the purpose.
A tidal foundation does not only move resources when things are breaking — it also moves when something can be built, protected, scaled, or made durable. Sometimes the tide must rise because communities are under attack. Sometimes it must rise because communities and movements have created an opening and need resources to turn possibility into lasting power. The work of stewardship is knowing the difference, staying in relationship with the shore, and refusing to let inherited formulas answer living questions.
This is the first in a four-part series on the tidal foundation concept. The second piece will go deeper into payout, endowment size, and the factors trustees and foundation leaders weigh when deciding what to hold and deploy. The third will explore how foundations can align grants, investments, and institutional power in service of mission, including examples from New York City and elsewhere where NYF and MCF are practicing these approaches. The fourth will widen the lens by featuring other foundations operating with a “tidal” model and showing a growing movement of institutions recalibrating fiduciary duty and responsible stewardship in ways that are both grounded and aspirational.
The call for a tidal approach to foundation resource stewardship is not an argument for choosing the present at the expense of the future. It is an invitation for foundations to bring more intention to decisions too often shaped by unexamined convention. It asks foundations to take stewardship seriously without making preservation the goal, to move with timely purpose when communities and movements can use resources to build lasting change, and to understand that stewardship is not only about what we protect, but also about what we make possible.
That is the promise of a tidal foundation.
Rickke Mananzala is president of the New York Foundation. Carmen Rojas is president and CEO of the Marguerite Casey Foundation
This is the first piece in a CEP blog series on the tidal foundation. The next piece will go deeper into how foundation leaders and trustees make spending decisions when more payout is possible.
