Traditionally, when it comes to philanthropy, there has been private philanthropy, and there has been government philanthropy, and rarely did the two meet.  But that division is now changing, as a growing number of philanthropists are looking at new opportunities in so-called public-private partnerships.  Take global financier George Soros. In August, his Open Society Institute and Soros Foundations Network gave $35 million to New York state to help fund a cash payment to poor families with school-age children. Qualifying families in New York got $200 each after Mr. Soros's gift enabled Albany to receive $140 million in matching federal funds, part of the federal stimulus bill, which otherwise wouldn't have been available.  "Government and philanthropists have been on parallel tracks for decades trying to solve bigger problems, and now the tracks are coming together," says Eric Kessler, founder of Arabella Philanthropic Investment Advisors in Washington, D.C. Mr. Kessler says he is working with a number of wealthy families and foundations on establishing public-private partnerships.  Both sides stand to gain: Donors leverage their dollars, and the government gets additional capital, plus the expertise and credibility that high-profile philanthropists often bestow on the causes they support.  "Government resources dwarf the funds spent by the nation's largest foundations and by individual donors, who contribute $16.4 billion and $163.5 billion per year, respectively," says Andrew Wolk, founder of Root Cause, a nonprofit based in Cambridge, Mass. "The federal government alone spends more than $1 trillion per year on social services." Mr. Wolk's organization supports groups that tackle social and economic problems.  In the past 15 years, nonprofits and private foundations have assumed larger roles in providing social services. Government often contracts with such groups to provide social services, including homeless shelters, food pantries and senior care. So, philanthropic cooperation between government and private sector has existed for a while.  But the past couple of years saw two other developments: a severe recession causing budget constraints at the local, state and federal levels and, as a result, even greater willingness of various governments to team with nonprofits and philanthropists to address major social problems. That means bringing new money and human resources to the table.  A variety of local, state and federal initiatives have sprung up to provide incentives for nonprofits and philanthropists to donate to a particular cause, largely through government grant programs that match private donations. Public authorities have also created offices of social entrepreneurship to promote innovative programs, work with private donors and fund those programs that become successful.  The federal stimulus package and its matching grants are one example of this approach. On the state level, Louisiana Lieutenant Governor Mitch Landrieu in 2006 founded the government-run Office of Social Entrepreneurship to bolster the state's social-service sector and ensure that funding for Hurricane Katrina recovery efforts would be well spent. In partnership with the public, private and nonprofit sectors, the office provides the state's most innovative programs with funding to help them grow. Those selected are then more likely to attract funds from other donors and the government.  In Santa Barbara, Calif., the Orfalea family and its Orfalea Foundations in 2007 decided to work with local government after a series of mudslides, floods and earthquakes sparked a slew of grant requests for disaster-preparedness efforts. Through their foundation, chairwoman Natalie Orfalea and her husband, Paul, the founder of copy chain Kinko's Inc., first commissioned a report by a consulting group to identify priorities and needs in the county, which includes some isolated communities.  "It became obvious there were some major gaps," says Ms. Orfalea. "We pay our taxes and rightly assume the fire department and police will meet all our needs. But the reality is, there are big budget constraints."  After months of meetings, the Orfalea Foundations joined forces with Washington consultants James Lee Witt Associates, the Santa Barbara County Office of Emergency Services, city administrators, local foundations and nonprofits to create Aware & Prepare, a partnership whose mission is to coordinate and strengthen local emergency-response and disaster preparedness. In March, the group created "Radio Ready," a system that links the County Emergency Operations Center with generator-powered radio stations in the event of power failure. Commingled funds helped pay for satellite and radio equipment, for 5,000 hand-crank radios to be distributed to citizens, and for a campaign to publicize how to use the radios.  To be sure, partnering with the government can have drawbacks. Any use of public funds invites debate over whether the money is being spent properly. Philanthropists thus can become targets for public criticism when they help fund initiatives that are controversial.  Republicans in the New York state Senate, for example, protested Mr. Soros's gift for children on welfare, saying it was not a good use of that money. State Republican leader Sen. Dean Skelos said the money would be better used to create jobs or roll back taxes. The gift generated further controversy because Mr. Soros and the state put $200 directly in the bank accounts of the families with children receiving public assistance. While the intention was for the money to be spent on school supplies, there were no strings attached, which Mr. Skelos also criticized.  Mr. Soros responded that the state, being squeezed by a budget crisis, was unlikely to come up with such funds without private assistance. "This program leveraged federal money that might have gone untapped," he said in an August statement. "State coffers were left intact."  Politics aside, working with government agencies also can take longer and be more bureaucratic than making direct, individual grants.  Lois Mitchell, president of the Orfalea Foundations, says her organization's largest obstacle in creating the Aware & Prepare program "was gaining the trust and building relationships with the government agencies. "At first, they didn't know how to respond to us," she says. Government agencies "think you're there to tell the public what a terrible job they're doing." Her group gained agencies' trust, she says, by inviting all the relevant players to the conversation and emphasizing the need for a community-wide partnership and aligned response.  Government bodies continue to warm to such opportunities. President Barack Obama created the White House Office of Social Innovation and Civic Participation to funnel government resources to nonprofit and private programs involved in charitable work. When private philanthropists find an approach that works, the government allot funds to those programs. The White House office started with a $50 million budget.  Similar government efforts are cropping up in Louisiana, Ohio, Texas and other states, and in such cities as New York, Boston and Chicago.
More private foundations are teaming up with government efforts to improve social conditions and emergency relief. Public-private partnerships help foundations leverage their capital, and help strapped government programs in these times of tight budgets.