The St. Paul-based Bush Foundation is committing $100 million in an effort to help close the wealth gap between white people and Black and Native Americans in a "reparative action."
The foundation is committing the money — which it says is "above and beyond" its regular grantmaking — to set up two community trust funds for Black and Native Americans in Minnesota, North Dakota, South Dakota and the 23 Native nations in the three states.
“Our purpose is to make our region better for everyone, and we believe that addressing racial wealth gaps is one of the most important things we can do for our region,” Bush Foundation Grantmaking Director Jackie Statum Allen said in a news release. “We are committing these funds in a reparative and restorative spirit. This is not reparations — that is a much bigger concept — but we do think of it as reparative action. We are excited to see other institutions pledging to do more to address racial wealth gaps and are eager to complement those efforts and encourage more action.”
The Bush Foundation will seek "one or two steward organizations" to receive the funds and design and operate grant programs to distribute the money. The grant programs are intended to serve people who need a financial boost to access wealth-building opportunities like education, homeownership and entrepreneurship.
“We think it’s imperative that these funds be stewarded by organizations that have deep understanding of and connection to the communities they will serve," Allen said.
The foundation's idea is to address the significant disparities in wealth between Black and Native Americans and their white counterparts, which reflect the impacts of the taking of land, slavery and other race-based policies.
“Current racial wealth gaps are the result of generations of unjust policies targeting Native and Black communities,” Grantmaking Director Eileen Briggs said in the release. “There are direct through lines from broken treaties to unemployment rates, from Indian boarding schools to high school dropout rates, from slavery to incarceration rates, and from redlining to homeownership rates.”
Disparities in America
The Federal Reserve's 2019 Survey of Consumer Finances shows a Black household's median and mean wealth (wealth is a measure of the value of what the household owns minus what it owes) is less than 15% that of white families, with the foundation noting the median black household in 2019 had 13 cents of wealth for every $1 of wealth for the median white household.
Meanwhile, the foundation says Native American households had 8 cents of wealth for every $1 owned by white households in 2000 (the most recent data available).
The Bush Foundation and other experts note wealth gaps are generational, with the Brookings Institute noting even when a white family and a Black family make the same income, the white family tends to have more wealth because they are more likely to inherit money than a Black family.
“Having money to pay for college or make a down payment on a house significantly affects your ability to build a strong family and help your community," Briggs said. "These trust funds are intended to be a community resource to support opportunities like education and homeownership.”
The stewarding organizations that will be tasked with distributing the $100 million will be chosen by the end of 2021. There will be a webinar for potential organizations at 2 p.m. on April 20. Those interested can register for the webinar and apply online here.
“Racial wealth gaps are profound and persistent,” said Jennifer Ford Reedy, Bush Foundation president. “It is clear that eliminating them will require greater commitment than we and others have made in the past. We are ready to do more, and we hope others are motivated to invest in and grow these community trust funds.”
The foundation is also directing $50 million through its regular grantmaking programs over the next five years to support "community-driven approaches" designed at addressing racial wealth gaps.