Government should help foundations do good work — not hinder them

Nearly a century after the Charles Stewart Mott Foundation was established, we’re still here to help our hometown of Flint and communities around the world address crises and embrace opportunities. The need for this kind of steady presence and community commitment was never more apparent than during the Flint water crisis, which began just over a decade ago.

Almost 90 years after our founding, we were able to commit over $100 million to help the citizens of Flint recover and rise from one of the greatest government failures of all time. This speaks powerfully to the value of giving in perpetuity.

In 2026, the Mott Foundation will celebrate our centennial. In our first 99 years, we’ve thus far granted over $4.3 billion in Flint and around the world. Adjusted for inflation, the number is $9.1 billion. Today our assets sit at $3.7 billion. So we’ve been able to give far more to charitable causes than we currently have in assets.

Some may argue that annually paying out 5% of assets is not enough or that we should pay higher taxes, yet our ability to convene and support many nonprofits in our hometown was critical during the water crisis and would not have been possible had we spent down or been taxed out of existence.

The Foundation and the many nonprofits we support served as a critical safety net for the community when government at all levels failed to meet citizens’ needs. For instance, it took our urging and a swift $4 million grant to facilitate the state of Michigan and the city of Flint coming together to switch the city’s water source from improperly treated Flint River water back to the Detroit water system.

This fast action led by philanthropy exemplifies both the need for an independent sector and the value of giving in perpetuity.

Today, the Mott Foundation has an annual budget of approximately $185 million. In our home community, we partner with the city of Flint, Genesee County, several school systems and numerous nonprofits to support a wide range of charitable efforts. These include new school facilities, afterschool programming, hospitals, early childhood facilities, community centers, policing, blight-elimination projects, local food banks, the Flint Farmers’ Market, a grocery store and Flint’s Cultural Center institutions. As our founder, C.S. Mott, stated, “In this respect, one may say that the Foundation can truly be thought of as a foundation for living.”

While the Mott Foundation has accomplished a great deal, the 5% required payout just barely allows us to keep up with inflation. Do we want to give less? No. Have we given more than 5% in a given year? Yes — and certainly during the water crisis.

However, as the city of Flint and the region continue to face economic struggles, and factories and businesses are closing, we are here as the last remaining buttress against economic policies that have left the city of Flint and its people behind.

I would argue that, if taxes on foundations or the payout requirement had been higher — or if C.S. Mott had chosen to spend down the Foundation’s assets during his lifetime — we wouldn’t have been able to avert the problems facing Flint today. We simply wouldn’t be here to help the community address them.

Philanthropy needs to be able to take a long view to address future challenges we might not be able to anticipate today. In 1963, just 10 years before C.S. Mott passed away, Flint was one of the most prosperous cities in the world and had a larger population than Houston, Texas.

Unfortunately, globalization and many other factors led to job loss and a resulting decline in population from a high of nearly 200,000 to less than 80,000 today. Those with the most economic security were the first to move away, leaving a city designed for 200,000 people with a much smaller tax base and many more challenges.

It’s within this context that the Mott Foundation is planning for our next 100 years — a period in which we hope to give away more than $20 billion, but this could now be at risk.

A bill that was introduced earlier this week in the U.S. House of Representatives calls for an excise tax of 5% on net investment income for foundations like Mott and up to 10% for larger foundations. The current flat rate is 1.39%. The proposed increase would have a significant negative impact on our ability to give — both annually and over the long term.

For Mott, it would mean nearly $10 million less for kids in Flint every year. And because tax policy is normally thought of in 10-year cycles, our grantmaking over the next 10 years would decrease by $100 million.

I ask whether this makes sense. Can the government — the same government that created policies that left Flint behind and caused the Flint water crisis — do better with this money than direct, on-the-ground support that Mott and many other foundations provide to their communities?

My experience in Flint tells me the answer is no. Let foundations have the freedom to give and support those most in need without additional taxes or regulations.