LA Philanthropy Watch

As noted in my previous post, the GGPNC board voted on June 1 to suspend all fund disbursements.  The timing was awkward, because a member of a community group was present to request a grant to support the 2010 Griffith Park Shakespeare Festival to be staged at the Griffith Park Old Zoo.  Independent Shakespeare Company, which received $5,000 from GGPNC in 2009, is seeking funding for this season’s production of Othello and Much Ado About Nothing.  Raising $125,000+ is not easy in the best of circumstances, but this is an especially tough year for nonprofits.

Budgeting and finances were an issue in the recent GGPNC election.  During the campaign, one newly elected member pledged frugality; another member of the Los Feliz Forward slate objected to specific spending priorities of the council.

Jessie Kornberg, the board’s secretary and a member of the Rules & Elections Committee, has experience as the executive director of a nonprofit organization.  Her critique of the board’s fiscal management focused on fundamental principles.  She pledged, during the campaign, to “bring my long-range planning expertise to bear on the GGPNC’s budget process to encourage an organized system for evaluating and awarding funding proposals.”

This is the approach followed by foundations in the nonprofit sector: there are funding guidelines, application forms, deadlines for submission, and a process (which is, in Max Weber’s terms, ‘rational’ and ‘efficient’) for making decisions.  The process, spelled out in writing, is readily accessible.  A nonprofit organization that seeks funding from a foundation knows how things work going in (whether or not its request ultimately receives an affirmative response).

In actual practice, relationships, past giving history, and other considerations all make the process less rational – and less fair – than it would be in an ideal world.  Because money is in short supply, and needs within the nonprofit sector are great, worthy institutions fail to get funding.  This may frustrate foundation decision-makers as well as nonprofits.  But having an established system for making decisions is a huge step in the right direction – rather than just winging it from month to month depending on who shows up with a request.

In the absence of a regular review procedure at GGPNC, the funding of community groups has been ad hoc.  Without structure and guidelines, the process is robbed of transparency and fairness, disadvantaging nonprofit and voluntary organizations in the neighborhood.  Haphazard decision-making hampers the board as well, rendering it incapable of doing any long-term planning.  There is no way to prevent the embarrassment of a worthy group appearing near the end of the fiscal year with a request, and finding that through lack of foresight there is no money left to allocate.

This is a situation ripe for reform.  I expect the new council majority to put in place “an organized system” for funding community groups.

Furthermore, as the Rules & Elections Committee has begun its work, I would anticipate creation of ‘rules of the road’ in a number of areas throughout the council’s operations.  The next several months promise to be eventful for the neighborhood council.  Folks interested in this process might want to attend tonight’s meeting of the governing board: 7:00 p.m.  at the Los Feliz Community Police Center (second floor of Citibank), 1965 North Hillhurst.

(Photo from Wikimedia Commons.)

Charity Navigator had a recent post about a donor who collected all the charitable solicitations he received by mail in one year (from December 1, 2008 through November 30, 2009): The total – from just 14 nonprofits – was 181 pieces of mail.  Each charity wrote him at least 8 times during the year; one organization sent him 24 appeals.

The post doesn’t advise us how often the donor responded with a check or credit card gift.

Here’s a link to a 4-minute video from Charitable Navigator on five steps you can take to limit the number of solicitations you receive.

From Charity Navigator “1 Appeal, 2 Appeal, 3 Appeal … MORE!“

A December 3 News Update in the Chronicle of Philanthropy features the results of a national survey on volunteering.  Some of the results:

Americans who volunteered their time and skills in the past year donated an average of 10 times more to charity than folks who don’t volunteer – $2,593 vs. $230 annually.

Two-thirds (67%) of volunteers say they generally make financial contributions to the same organizations where they volunteer.

Almost half (47%) surveyed volunteers are more motivated by what they get from their experience than by what they can do for others.

Half (51%) are more likely to volunteer for an organization that has other volunteers in their age group – especially volunteers under 35 years old (59%).  A third (33%) of this under-35 group volunteer in order to network professionally (vs. 14% of volunteers over 55).  Volunteer rates increase with educational level: 61% of Americans with post-graduate degrees volunteer; 56%, with college degrees; and 36% of high school graduates.

Top reasons to volunteer:

• Supporting a cause they care about – 72%
• Because it is the right thing to do - 69%
• To fill an unmet need in the community – 54%
• To set an example for family and children – 53%

Almost a third (31%) of volunteers say they are more likely to volunteer because of the economic slowdown.  Middle aged adults (35-54) were more likely to volunteer (56%), than those older (38%) or younger (33%).  More than half (54%) of women volunteered at least monthly vs. 43% of men.

A Fund Raising Tip: The link between volunteering and giving is well-established.  This is at the center of basic fund raising strategy.  People are more likely to give – and to give progressively larger gifts – if they are involved with your nonprofit.  Volunteering is among the best ways to increase their involvement.  If they care enough to volunteer, and have an opportunity to see up close the difference your organization makes, their commitment will increase – and their willingness to give dollars (not just time).

Skilled Volunteer Roles: Finding meaningful roles and assignments for volunteers can be challenging for nonprofits.  The October 15 Chronicle of Philanthropy featured an article [subscription required] by Ben Gose, “Can the Nonprofit World Handle a Flood of Helpers,” which discussed the disappointing experiences – such as not getting their phone calls returned – prospective volunteers had when they contacted a charity they wished to help.   An April 2009 survey by Deloitte found that 95% of nonprofits want and need pro bono assistance and skilled volunteers, yet 35% do not have sufficient infrastructure to train and manage volunteers and 24% have no plans to deploy skilled volunteers or pro bono support in 2009.

As Karen Baker, California Secretary of Service and Volunteering, told the Chronicle, most nonprofits don’t even have a system for handling phone inquiries from volunteers, and while volunteers might bring enthusiasm to their role, “most nonprofits aren’t as prepared as they would like to be to take good advantage of that energy.”

The survey of 1,005 respondents from October 21-25 was conducted by Harris Interactive for the Fidelity Charitable Gift Fund and VolunteerMatch.

On page three of this morning’s Los Angeles Times, Bob Pool (who authored the two other Times stories referenced below), has a feature highlighting a benefit for Integrated Recovery Network – this Tuesday night at  two Laugh Factory venues: Hollywood (pictured) and Long Beach.  The Hollywood benefit will include Kevin Nealon (mentioned below) and other comedians; it will be hosted by Mark and Brian (who are featured on a billboard visible in the photo).

Some background: A Column One story in the October 16 Los Angeles Times, “Woman, 97, has a front seat to homelessness,” reported on a woman living with her two adult sons in a Chevrolet Suburban on the streets of Venice.  That story recounted that the family “encountered actor-comedian Kevin Nealon at a gas station. He bought gas for them and introduced them to Laugh Factory owner Jamie Masada, who gave them pizza for dinner and said he may attempt to organize a fundraising show for them.”

A follow up story on October 20, “Nonprofit group comes to homeless family’s aid,” reported that a new nonprofit, Integrated Recovery Network, had assisted the family by finding them a place to stay.  (LA Philanthropy Watch featured this story in a previous post.)

I had an opportunity recently to speak with the executive director of Integrated Recovery Network, Marsha Temple, whose vision led to the founding of the nonprofit about a year ago.  I learned that Integrated Recovery Network starts with the ‘Housing First’ imperative of a number of agencies: to end homelessness, first find a permanent place (and some stability, not just a shelter) for folks who have been living on the street – and provide whatever support services they need.  The Integrated Recovery Network model identifies assisted living facilities as the stable destination.  There is much more information about Integrated Recovery Network at its website.

Click on the LA Times link of today’s story for details about this benefit.

A recent article in the Chronicle of Philanthropy (subscription required), “Are Charities Ready for Tough Times Ahead?” prompts San Francisco nonprofit attorney Gene Takagi to change the question slightly on his blog, “From a governance perspective, the question may be slightly altered to ask ‘Are Charity Boards Ready for Tough Times Ahead?’”

While the focus of Mr. Takagi’s post is not on fund raising, I was struck by the juxtaposition of his question and the answer given (to a related question about fund raising in tough times) on another blog:

A survey by The Agitator asked fundraisers to identify the “single biggest challenge your fundraising program faces in 2010,” which produced this result:  “Way ahead as the #1 challenge — expressed in a variety of ways — was getting Board  and senior executive buy-in, including direct participation, for more aggressive fundraising efforts.”

2010 is likely to be another challenging year for raising money.  To meet those challenges, fund raisers must form strong partnerships with their chief executives and the leadership of their boards of directors.  Everyone needs to be on the same page, embracing the same agenda.  Or, to change metaphors, everyone must be pulling in the same direction.

(Photo of Taylor Woodrow’s Teamwork Sculpture from Wikimedia Commons.)

“One hundred years after the birth of Saul Alinsky…,” note the authors of a paper presenting a pragmatic overview of fund raising, with a former community organizer in the White House and high-profile political attacks on community organizing groups, “… almost every American has at least heard of community organizing.”

The Aaron Dorfman, executive director of the National Committee for Responsive Philanthropy and Marjorie Fine, director of the Linchpin Campaign (a project of the Center for Community Change) have teamed up to write a paper with tips and strategic perspective on fund raising for community organizers.

“Seizing the Moment: Frank Advice for Community Organizers Who Want to Raise More Money” [pdf] offers basic advice, which will be familiar to experienced fund raisers in the nonprofit community, with reference to the mission and activities of community organizing groups.    The points include a focus on building relationships with donors, prospecting to identify additional donors, communicating clearly – and with examples – the work of the organization, and listening to donors and program officers.

“Listen actively and with focus so that you can build bridges between their interests and yours.

The first time a donor or funder gives your organization money, it is an act of faith upon which trust will be built.”

Along with savvy tips and techniques, the paper includes a list of resources to help organizers raise money.  The NCRP offers free downloads of this and other recent publications.

(Image from Wikimedia Commons.)

“After years in the shadows, the everyday donor is emerging as philanthropy’s newest hero, the driver of a more down-to-earth approach to charity,” begins Stephanie Strom’s story in this morning’s New York Times (via Philanthropy Journal).

The story suggests that high-profile charities have come to understand the importance of modest givers – as opposed to “mega-donors” – and that newly formed charities are focusing on smaller donations.

The article quotes the Executive Director of the Robin Hood Foundation (described by Ms. Strom as “famous for annual benefits where billionaires routinely hand over $20 million”) attesting to the importance of small gifts and the President/CEO of Independent Sector, who says many charities are “making an effort to diversify their funding bases and not depend on a few large funders, whether they be foundations or individuals.”

The experience of small and mid-size nonprofit organizations – which represent most nonprofits in the sector – is far removed from the rarified world of billionaires and mega-gifts.  So a focus on modest gifting is nothing new.

Virtually every nonprofit, in my view, should have a major gifts program – or should be building the foundation from which to nurture and develop major gifts over time.  Annual donors of small gifts – $10, $25, $100, $250 – are the basis for a healthy fund raising program – which can serve as the foundation for a major gifts program.  Note, though, that for many organizations a major gift might be $2,500 or $1,000 or less.

Last month, in a post about Charity Navigator’s advice for giving wisely, I commented on the importance of annual giving, major gifts – and face to face fund raising.  For most nonprofits, this is fundamental – neither overlooked, nor forgotten.

A recent Harris poll reveals increasing numbers of Americans are finding ways to cut back on everyday spending.  For instance, 64% are purchasing more generic brands, 47% are packing lunches instead of buying them, and 43% are getting fewer haircuts.

Tom Belford at The Agitator (a popular blog that offers fund raising tips) zeros in on two cut backs: 34% are paring back their magazine subscriptions, while 21% have canceled their daily newspapers.  “In particular, cutting back on magazines strikes me as very analogous to cutting back on donations …”

He concludes, “The data, indicating that significant belt-tightening is still underway, indeed increasing a bit, suggests that fundraisers shouldn’t get TOO optimistic about 2010 prospects.”

This week the Los Angeles Times ran a story headlined, “Card clubs and other special interests give to Jerry Brown charities.”  I discussed the issue of ‘behested payments’ – philanthropic giving at the behest of an elected official – from the standpoint of a nonprofit organization and of a donor (who might lack charitable intent) earlier this week.  In this post  I will comment on this issue with a focus on Jerry Brown – the solicitor.

1. First, let’s acknowledge that Mr. Brown is a great volunteer.  He is committed to the organization(s), he understands the importance of fund raising, and he is prepared to step up and do it.  If every nonprofit board or committee member were prepared to rise to the occasion in this way, the world would be a different place.  (I say this as someone who has worked in partnership with volunteers for many years.)

And let’s acknowledge the strategic decision-making that is an essential element of any thoughtful solicitation plan: we select the volunteer (or executive) in the best position to make the ask.  Who has a relationship with the prospect?  Who might wield some influence over her/his decision?  Whose vision and judgment does s/he respect?  Who will the prospect find it harder to say ‘No’ to, or easier to give an affirmative response to?

For the two Oakland charter schools we have discussed, Jerry Brown was the go-to volunteer.  We don’t know how many folks said ‘No’ to him, but we know a number of individuals and institutions came through with major gifts at Brown’s behest.

2. But Mr. Brown is also the Attorney General of the State of California (and may be elected Governor within the year) – with jurisdiction over many matters of concern to the folks he solicited.  That leads to this predicament: these gifts pose obvious conflicts of interest.

In fact virtually all fund raising by elected officials raises conflicts of interest.  It doesn’t matter whether the money is to elect someone to office, to enact a proposition, or (as in this instance) to support a favorite charity.  One naturally feels gratitude (and perhaps some sense of obligation) upon receiving a gift; it would be natural for a donor to expect Mr. Brown at the least to “keep an open mind…” [see the Times article for the full quote] in any future conversations about matters of public policy … which leaves open the possibility of staking out a position amenable to the donor’s interests.

“It’s great to give, but are they giving because Jerry Brown is a great guy or because he’s attorney general?” asks Robert Stern, president of the Center for Governmental Studies in Los Angeles (as quoted in the Sacramento Bee’s CapitalAlert blog).  Mr. Stern also notes that such gifts cannot be banned.  The best we can do is to require disclosure, which is why we can find lists of behested payments at the Fair Political Practices Commission website.

With full disclosure – and much additional information – we are in a position to make judgments about behested payments and about the public officials who made the successful solicitations.  What considerations might we bring to bear on our judgments?

Via Google, it is simple enough to find any number of allegations of improper behavior related to elected officials’ relationships to nonprofit organizations.  I will not bother with the links, but the examples include: 501(c)(3) organizations that funded activities unrelated to any charitable purpose, including organizations that functioned as illegal conduits for money-laundering.  Nonprofits that provided income for a politician or spouse.  Nonprofits that funded activities to generate crowds and publicity to benefit the politician, including nonprofits conveniently named after him.

When we review the list of individuals or industries that have made ‘behested payments’ we make judgments about the nature of the charity involved and the political figure’s relationship to it.  We make judgments about the character of the public official and the measure of charitable intent we perceive.  We also – if we are vigilant – make judgments about any decisions the office holder makes that may benefit or disadvantage donors who responded with a behested payment.

Jerry Brown responded to the suggestion that behested payments might influence the performance of his official duties with these words, “I have an unimpeachable record of integrity.”

This brings to mind the words of the late Jesse Unruh, who said of legislators, “If you can’t take their money … and vote against them, you don’t belong here.“   (The whole quotation is more colorful – the legendary ‘Big Daddy’ of California politics was a colorful figure – but this excerpt makes my point clearly.)

Can Jerry Brown do that: make decisions and undertake activities opposed by special interests that have made gifts at his behest?  Perhaps.  I actually don’t think this is at all far-fetched.  His long political career has generated considerable attention and controversy, but has been remarkably free of the suggestion of scandal.  I see no reason to question his genuine commitment to the Oakland School for the Arts or the Oakland Military Institute.

For my part, I will keep in mind the Fair Political Practices Commission’s list of behested payments as I watch Mr. Brown’s decisions and activities as Attorney General.

(Photo by Steve Rhodes at Flickr.)