Before You Leave For the Weekend...

• Giving to charity is good business. Really.
  
• I'd give this guy my Special Place in Hell Award, but he's a pastor and I'm afraid of going to hell. Of course, the fact that he's a pastor didn't stop him from using his position as a church leader serving the poor to buy food at a reduced rate at a food bank, and then selling it to regular folks for regular prices (and keeping the proceeds for himself).
  
• T. Boone Pickens' $165 million gift to OSU athletics, which made no sense to me in January, makes even less sense now that we know this.
  
• For my friends in the midwest, I'll be on KMOX on Sunday morning at 9:35 am CST. Supposedly to talk about charity-related tax tips, but I'm hoping to slip in my opinions on the preposterously overrated Tony LaRussa.

Quick Hits and Tip-Ins

• The Baltimore Sun reports that their local symphony is using their massive endowment to pay off their debts. Seems like a logical idea, but questions regarding honoring donor intent are raised (by me, of course).
  
• George Clooney's Oscar swag yields $45,000 for charity. More proof that he's the coolest guy in the room, and I don't care what room we're talking about.
  
• The unfortunate story of the charity accountant who stole charity money to pay for his dominatrix (especially unfortunate for Sandra Miniutti of our staff who was forced to comment about it on air with Joe Scarborough of MSNBC) was resolved this week when Abraham Alexander of the Cardiovascular Research Foundation was sentenced to 2-6 years in prison.
  
• The Red Cross is working very hard in an effort to finally lose my support.
  

This Is Who You Want To Regulate the Red Cross?

I've long advocated for a strong federal agency (a charity SEC, if you will) to regulate the one million non-profits in this country. Of course, this call for more government intervention is based on the premise that our elected leaders are basically honorable folks. This premise can be fairly called into question when you find out that the House Majority Leader created a "charity" not to serve the public but to launder money and reward his friends financially.

Missed It On The News Stand?

If you don't subscribe to "Interactive Dad Magazine" (and if you don't, what is wrong with you? Do you hate America?), you might have missed this article. With a little help from Charity Navigator, they lay out all you need to know before you fill out your taxes, if you gave to charity in 2005.

Satellite Radio Differences

Sirius has Stern. XM has...Stamp?

I'll be on XM radio (as well as Cincinnati's WLW for those of you listening the old-fashioned way in the Buckeye state) today (Friday) at 2:10 PM EST. Channel 173 on your XM dial. The topic is the always scintillating "tax tips for charitable giving."

(UPDATE--Just got bumped until next Tuesday, the 28th. The radio station said there was a big local story that was going to consume them today. Apparently my tax tips could wait. I assume the bigger story is this. But I suppose it could be this?)

Let The Birds Speak!!!

Today, in something called the "Tampa Bay Newspapers", the Suncoast Seabird Sanctuary "responds to their critics." I would guess that, based on this and this, they're referring to us.

Normally, I would just ignore something like this, as I really do simply want to focus our work on helping donors, and not getting caught up in a silly game of "he said/she said." But their responses are just too good to ignore. So in the spirit of March Madness (and "madness" is a pretty good word here), let's break down their answers, Billy Packer-style, to the criticisms that they may not be operating in a way that honors the public trust:

1. They say that those that evaluated them insisted "on looking at the bottom line of their tax form." Umm, ok. Guilty as charged! The "bottom line" seems like a pretty good place to start. Next?
2. They attribute many of their current financial troubles to "9/11." Umm, ok. I don't even know what to do with this. I guess if it worked for George Bush, it should work for the birds. Next?
   
3. They claim that much of the criticism of them stems from the fact that they're "too darned honest." Umm, ok. But we never accused them of being liars. Just of wasting the public's money. Next?
4. They claim that, and I quote, criticism of them is "a malicious campaign to get us out of here, get rid of the Sanctuary, and develop the land.” Umm, ok. As one of my colleagues said, this is the plot of every bad movie of the 1980s, where the evil developer wants to evict the bird sanctuary or after-school program, so he can build a shopping mall. In this case, this assertion is actually great news for me. I had no idea that I was planning on buying the land, once I get rid of the Sanctuary, and building myself some condos. The wife is going to be thrilled.
   
5. And finally, they play the "yeah, we're inefficient, but we're doing great work" card when their executive director says "when I see injured birds actually walk up to the Sanctuary seeking help, it bolsters my intention to stay." I'd say, "umm, ok" but that just doesn't work here. This is amazing. Can't you just see the injured birds (too injured to fly, but not to walk), limping down the streets, ignoring the evil criticisms of Charity Navigator, pushing through the pain, finding their way to the Sanctuary (nestled between the condos) and knocking on the right door, in pursuit of medical attention? And kindly Ralph Heath comes out (he's never on one of his fishing charters when the injured birds walk up), takes them in his arms, and nurses them back to good health.
   

If you're a donor to this organization, I wish you well. And if you're a hurt bird, you can find their address here. Walk carefully.

Employment Hope for Convicted Drug Smugglers

I'm usually reluctant to pile on the Red Cross, but sometimes, their arrogance and subsequent tone-deaf actions make it awfully difficult to defend them. This would be such a time.

Apparently, the San Gabriel Pomona Valley (California) chapter Board chair hired a woman who had served time in prison for smuggling heroin to act as the chapter's CEO. That convicted drug smuggler then hired another felon to serve as the chapter's top fundraiser.

Shockingly, the culture of felons apparently didn't serve the organization particularly well, as management made a series of unfortunate decisions, many of which resulted in lawsuits, donors abandoning the chapter, and numerous negative stories in the local media.

I'm all for redemption, but I think there may be a limit.

Wish We'd Been Watching That Watchdog

Want to know why we resist the title of "watchdog?" Maybe it's because of the company we would have to keep.

Here's the story of a "watchdog" named Public Interest Watch. According to their website, they work "to fight charitable trust abuse by exposing individual cases of abuse and advocating for stronger governmental oversight, including requirements for greater financial disclosure by charitable organizations."

The main charity they seemed to have "exposed" is Greenpeace, which they urged the IRS to audit, as a result of their knowledge that Greenpeace was committing fraud, in the name of the public trust.

Sounds good, right? (And for the record, we're not huge fans of Greenpeace here either, although we have no reason whatsoever to question the validity of their financial records.)

Would it still sound good to you, if you knew that 97% of this "watchdog's" funding came from ExxonMobil, which may have some philosophical differences with those attempting to preserve the environment? And what if this connection was nowhere to be found on the website of either Public Interest Watch or Exxon Mobil?

"Public Interest Watch?" Which public is that?

Serious Reform?

Senator Charles Grassley took time out from holding a press conference yesterday to hold a press conference, at which he announced that he was going to include non-profit hospitals in his potential spheres of charity reform.

Grassley’s message yesterday to the hospitals was “as a charity, either do some charity work, or be a for-profit like your peers.”

Regular readers of this blog will know that this is one of my favorite topics (read here or here for more) and I have long advocated that no one should take any regulator seriously if their reforms for the non-profit sector don’t include non-profit hospitals, an area where the abuses, inequities, and hypocrisies are rampant, and reforms would actually be pretty easy (just mandate a minimum level of charity care necessary to maintain tax-exempt status—don’t reach the threshold, you’re a for-profit and have to pay income taxes.)

I am of course not optimistic, because, well, I’m rarely optimistic when it comes to charity reforms. Plus, the hospital lobbies are beyond powerful. And the last time Grassley told a sector to reform itself or face regulation, the result was the toothless Independent Sector proposals of last summer. The time before that (nearly 20 years ago), in the wake of the scandals and donor frauds that plagued Christian charities, the irrelevant ECFA emerged, where no Christian charity ever fails to meet the standards of the certifying body.

But, hey, it’s a start. Any legislator that proposes reforming something that needs reform deserves our support. Senator Grassley has mine.

Brand Loyalty

The New York Times has the story of what some charities are doing to creatively attract new and younger donors. In the article, Sandra Miniutti of our staff warns more conservative and older charities that they better pay attention, or take the chance of losing these donors forever.

Out of Service

Here's a couple that convinced people to donate 100,000 used cell phones. They were going to give the phones to battered women, the elderly, and the disabled. And they did just that, for at least some of the phones. A grand total of 300 of them. The remaining 99,700 phones they sold for just over a million bucks. This is apparently a crime.

Pink Icing

I hate hockey, but this is kind of cute, and for a good cause.

Might be a good idea for Barry Bonds too. Maybe he could get the media, the feds, and the commissioner off his back if he'd start swinging a pink bat.

Public Service Podcasts

Love Charity Navigator as much as me, and want to air our new PSAs on your podcast? Click here to access. I don't know much about this myself, but I'm pretty sure we're ahead of the curve (again) when it comes to implementing new technology in the non-profit world, and we're happy to provide these PSAs to podcasters (for free, of course) who share our passion for informed giving, no matter their subject or area of expertise.

A special thank-you to to Billy Surf, President of PocketSpots, for producing the spots, and Eric Weymuller of Blast Podcast for distributing the PSAs.

Take This Job And...

A new study reveals that most non-profit executive directors will be gone within 5 years. Some will retire (every sector actually faces an emerging leadership crisis in the next 5 years as the Baby Boomers retire), and some will leave for other jobs with more money or power, but most are simply fed up and want out.

The #1 source of frustration (shockingly, despite what I hear on the phone every day, it's not Charity Navigator) for non-profit leaders is their board. "Disengaged," "uninformed", "unreasonable" and "reluctant to lead" are some of the descriptive words used by the leaders. Of course, it's important to remember these are anonymous polls and few leaders, of any levels, would ever be willing to criticize their bosses.

But if we're losing good leaders, and I know we are, this is a problem worth discussing.

Daisy Duke Disses Dubya!

Jessica Simpson turned down an offer to meet President Bush yesterday, saying she was in DC on behalf of her favorite charity, Operation Smile, and meeting him would have politicized her efforts. Of course, she's in DC to lobby members of congress for the charity, which seems like a relatively "politicized" effort.

For what it's worth, Operation Smile is officially "non-partisan." (There are partisan cleft-palate repair groups?)

News From The White House

Sandra Miniutti, Charity Navigator's Director of External Relations, was invited to the White House's Conference on Faith-Based and Community Initiatives last week. I asked her if she'd mind sharing her thoughts with readers of this blog on that day. Here's Sandy's take:

"When I learned that I’d have the opportunity to have lunch with the President (and several hundred other charity representatives) at the White House National Conference on Faith-Based and Community Initiatives, my excitement over being in the same room with the President was tempered by my expectation that I’d be spending the day praying and “God Blessing” the fellow attendees. While there was prayer and I was blessed several times, I was surprised by the underlying theme of the day. Over and over the panelists, even the President in his speech, said that results matter.

Under Bush’s direction, the federal government now says it shouldn’t matter if food bank serves up prayer with a hot meal. What matters is that the food bank is effectively and efficiently addressing hunger. Under Bush’s philosophy, if a faith-based food bank is delivering more impressive results than a secular group, then the government should fund the faith-based group. Here is some of what I heard at the conference:

“In our country of affluence, there are so many pockets of despair… this initiative isn’t about religion… it is about results… helping the poor.” - Jim Towey, Director of the White House Office of Faith-Based and Community Initiatives

“As we expanded our program into other cities, we hired someone to identify, track and share best practices.” –Eric Schwarz, President and Founder, Citizen Schools

“There are 115 new charities everyday in the US. Donors are more sophisticated and demand results. As a result, competition for donor dollars has never been greater.” –Vanessa Kirsch, President and Founder, New Profit

“Statistics matter… when you focus on results, all of a sudden it becomes crystal clear how best to spend resource dollars to achieve certain objectives.” - George W. Bush, President, United States of America

“Be intentional in the results you want.” – Marilyn Anderson Chase, Senior Vice President of Community Impact, United Way of Massachusetts Bay

“Make a difference. Sounds obvious, but if you don’t measure it, how do you know you’re making a difference? How can you manage the program? Improve it? Tell others? Replicate it?” – Reverend Bruce Bjork, Director of Programs, Greater Minneapolis Council of Churches

“It isn’t enough anymore to just ‘do good.’ Every time the media runs a story about a fraudulent charity it hurts all of us. Therefore the changes that are coming, and the demand for accountability, are good developments.” – Joel Carp, Senior Vice President for Community Services and Government Relations, Jewish Federation/ Jewish United Fund of Metropolitan Chicago

I’m still not convinced that we’re not muddying the waters in regards to the separation of church and state, but I was encouraged to learn that the federal government shares Charity Navigator’s belief that even in the charitable sector, results matter."

Didn't See This Coming...

The New York Times has the inevitable story of the hundreds of new disaster-relief charities that sought tax-exempt status in the weeks following Hurricane Katrina, and how many of them have since disappeared or are facing major challenges. You'll remember that these charities were given special green-light expedition of their non-profit status, for no particular reason, other than they promised to help Katrina's victims. One of these charities, something called Drop Yer Drawers, which promised to collect and distribute underwear, waited eight days to get their 501 c3 status. (Charity Navigator, as a contrast, waited 11 months for ours).

And just in case you think I'm just dropping into this story to Monday Morning Quarterback, here's my blog entry of September 23, 2005 where I announced that this was a stupid policy, doomed to fail.

TurboTax for Charities

All-right, time to do my quick public service announcement for the year. If you run a non-profit (and if you do, why are you reading this blog? Get back to honoring the public trust and safeguarding donor intentions and stop surfing the internet), did you know that you can file your 990 on-line? Yes, it's true, and available to non-profits, only 20 years after it was available to regular taxpayers everywhere. Get more info here.

Pay Now And Pay Later

As someone who has studied the finances of non-profit private schools, and also as a parent who sends my daughter to a private pre-school, I was not shocked to learn that private pre-school in California costs more than sending your kid to a public university there.

You Can Go Now

In the days after Hurricane Katrina, the city of Houston opened their doors to over 150,000 evacuees. Six months later, as crime rates rise, schools are over-burdened, and hospitals are packed, many Houstonians are ready for the newest residents to go home, and if they can't go there, to go somewhere else. Newsweek calls it "compassion fatigue."

Thanks for Coming

The Washington Post reports that the American Red Cross paid Marsha Evans nearly $800K in "severance pay" when she left the organization. This is actually not that shocking a figure, given the size of the organization and Evans' $500,000 annual salary. (And for some perspective, Carly Fiorina received over $40 million in severance when she left HP). Of course, people don't normally get 2 years worth of salary when they "resign to spend more time with their family", the story originally floated by the Red Cross. Since then, we have of course learned that Ms. Evans was asked to leave, and quickly. This "severance" pay only confirms that.

Joe Cool

Something called CoolPick.com says Charity Navigator is the "cool site of the day." It's been 25 years since someone said I was "cool."

OK, I lied. No one has ever said I was cool. Thanks for the shout out, CoolPick.

Promotional Giving

Wal-Mart announced that they are teaming up with America’s Second Harvest to raise as much as $10-million for the national hunger group, reported the Financial Times. This large donation and partnership with a national organization signals a new approach in Wal-Mart’s giving philosophy. Last year, they gave away over $200 million, and made most of its donations in amounts of less than $1-million each to local charities chosen by the company’s employees. This allowed the stores to be active in their own communities but didn't create much of a national philanthropic presence (at least in terms of PR).

The money quote in the article is from marketer David Hessekiel, who dismisses Wal-Mart's previous strategy as not doing "much to make people aware at a national level of what they were doing."

No discussion of whether this new strategy is more or less effective than the previous one, in terms of actually helping people out or making a difference in the world. It's almost irrelevant when it comes to corporate philanthropy. They give not to do good, but to look good. And I suppose that's ok, as long as they give. But to think that corporations are engaging in serious research re: effectiveness in their philanthropy is naive.

I talked to the director of corporate giving for one of the nation's largest investment banks once, and he told me that, when he considered who to give to, he had to satisfy these constituencies in this order: investors, Wall Street, the board of directors, senior leadership at his company, customers of his company, the company's regular employees, the media, interest groups (other than the groups they were considering) and then, and only then, the charities involved. As a result, he had little interest in anything controversial or daring, and couldn't care less about the charities' effectiveness or efficiency. He just wanted something safe that aligned well with their brand name and assured everyone involved that the company had a presence in the community.

March Madness

According to the IRS, Georgetown University is a 501 c 3 public charity. Accordingly, Charity Navigator evaluates them. Shockingly, they're in pretty good financial shape. Better than these guys at least.

Like all other non-profits, they must report the salaries of their highest-paid employees. Their president, a man named John DeGioia, made just over a half-million bucks last year. Their second-highest paid employee? John Thompson, who resigned as coach of Georgetown in '99 (his son, John Thompson III is now the Hoya coach).

Coach Thompson, who no longer coaches or even teaches, makes just over $400,00 a year from Georgetown. His title is "presidential consultant for urban affairs."

Good "work" if you can get it.

"Superman's" Widow Moves On

Dana Reeve died last night. She was the wife of Christopher Reeve and the chairperson of the Christopher Reeve Foundation. We were never big fans of that organization, but no one can deny that she and her husband helped them raise a ton of money and promoted great awareness of potential paralysis cures.

Ms. Reeve died of lung cancer, despite reports that she had never smoked. If you're looking for a good organization working in that area, here's my pick.

Benevolent Babies

Scientists prove that we start acting charitable and altruistic as early as 18 months old. It's not learned, but innate. Of course, if we sold the babies' names to a bunch of other organizations every time they tried to help, this might stop. But for now, it's good to know that we're born wanting to help others.

Florida's Birds Are On Their Own

Another story on the Suncoast Seabird Sanctuary. Simply unconscionable that these people are free to solicit donors, and offer them a full deduction as a registered non-profit, despite overwhelming evidence that they have little interest in saving birds, or serving the public good.

Too Many or Not Enough?

Here's a piece on Business Week Online where a charity leader takes great offense with my assertion that there are too many charities in this country.

She makes a few good points and she's right in the sense that it is kind of un-American to argue that many charitable entrepreneurs should close their doors. Basically, she says "what's the harm?" in having so many groups.

To answer that, I point you to this piece on the Charity Navigator site, where Andrew Heck of our staff reviewed the latest reports compiled by state attorneys general on fundraising rates in their states. Andy found that, on average, those charities that used paid fundraisers paid out roughly 50% of the monies they raised to those fundraisers. That means that of every dollar given by donors, 50 cents went not to charity, but to professional telemarketers. This is a supposedly necessary evil when you have a million charities, many with nearly identical names, attempting to convince a fixed pool of donors that their group is the most worthy of donations.

If Only She'd Been an Orphan Too

Usually in this blog, I take a news story about mismanagement at charities, add some hyperbolic outrage, and proclaim the folks involved as "destined for hell." This is just the way it works. Righteous indignation sells.

Imagine my surprise this morning when I opened my local newspaper (the usually relatively understated and calm Times Herald-Record of New York's Hudson Valley) and found that the paper itself had upped the ante to a level at which even I, the screamer, could not compete.

Today's banner headline and #1 story in America (and I quote):

"HEARTLESS!: Man Accused of Stealing Charity Jar for 9-Year-Old Blind Girl with Brain Tumor!"

For once, I simply have nothing to add.

People Are Talking 2

Things I heard at TED (dead people edition):

"If all the insects on earth disappeared, within 50 years all life on earth would disappear. If all humans disappeared, within 50 years all species would flourish as never before." -Jonas Salk

"The dogs may bark, but the caravan moves along." -Ancient Arabic Saying

1. They ignore you. 2. They laugh at you. 3. They oppose you. 4. They say they were always with you. -Gandhi, on the 4 steps to outsiders resisting your ideas

"Evolution is cleverer than you are." -Anthropologist Francis Crick

(TED2006)

People Are Talking

A few random things I heard at TED:

"A girl born today in Japan has a 50% chance of seeing the year 2100. A girl born today in Afghanistan has a 25% chance of not seeing her 5th birthday." -Futurist Erik Peterson

"He was in someone's English class wasn't he? ... How annoying would that be?" -Ken Robinson imagining the challenge of teaching William Shakespeare

"Of the 6000 languages spoken in the world today, 3000 are not spoken by the children, which means that we are halving our linguistic diversity" -Photographer Phil Borges

"Six months ago, the 100 most-popular blogs on earth were in English. Just six months later, at least 12 are in Chinese." -Ethan Zuckerman

"Six years ago, 66% of internet users came from North America. Today, it's 23%." -Zuckerman, again

"You can move much faster if you're healthy first than if you're wealthy first." -Hans Rosling, illustrating the fate of nations' development over the last 40 years

"If newts can regenerate a lost limb, why can't we?" -Dr. Alan Russell explaining advances in regenerative medicine

"Your vision is larger than our appetite." -The U.S. government's response to Dr. Russell, when he sought funding for his projects

"We are now returning to an ancient form of marriage: one based on equality and symmetry... If there were ever a time in human history when we had the opportunity to make good marriages, it's now." -Anthropologist Helen Fisher

"Unless we change, this will be the first generation of Americans ever where our kids live shorter lives than their parents." -Dr. Dean Ornish, commenting on the obesity epidemic

(TED2006)