Posts tagged ‘Center on Philanthropy’

April 5, 2013

If You Don’t Care About Them, Why Will They Care About You?

A reader of Michael Rosen Says… recently contacted me with her/his own unfortunate experience with a nonprofit organization. S/he provided me with a copy of an email exchange s/he had with a theater company. I’m going to share this person’s story with you because it contains a worthwhile lesson about the importance of reciprocity.

Photo by Shira Golding via FlickrBefore I get to the story, however, I want you to know that I am editing the emails for brevity and any identifying information. I’m protecting the name of the theater company, the name of the Managing Director of the theater company, and the reader who contacted me because neither party knew, at the time, their one-on-one communications would find their way into the press.

From time to time, I write about the blunders that some nonprofit organizations make. I’ve done this, not to shame them, but so others can learn from someone else’s mistakes. It is much less painful if we learn from someone else’s missteps rather than our own.

The story begins when my reader — let’s call her/him “Sam” — received an email from a theater company. Sam, who had purchased two season subscriptions, immediately opened the email. The message promoted an interesting lecture by a well-regarded nonprofit leader in the community. The lecture dealt with leadership and tied-in with the company’s current play.

The event appealed to Sam. Just before clicking through to the organization’s website to accept the invitation and purchase tickets, Sam noticed the date of the lecture: Monday, March 25. Unfortunately, this meant that Sam would not be able to attend because that date was the first night of Passover, an important Jewish holiday.

Annoyed that the theater company would schedule a special one-time program on Passover, Sam wrote to the theater company:

Disappointing scheduling of an otherwise appealing, academic lecture.

So, add this to your discussion: Does a good (nonprofit) leader ‘dis’ a large portion of the region’s top arts patrons through thoughtless event scheduling?

We’ll be celebrating first Seder.

We really would have enjoyed hearing the address on this topic. The speaker is a dynamo.

Sam”

The theater’s Managing Director responded the next business day. This was very good. The Managing Director did the smart thing by responding soon after receiving the complaint:

Dear Sam,

Thanks very much for writing. I’m very sorry for the scheduling inconvenience. We truly do our best, but we present special events all season long and it is not possible to avoid all holidays on the calendar. For example, this event takes place on the first night of Passover, we have a performance of XXXXXXX on Easter, etc.

If you’re interested in history, I hope you’ll consider joining us for the talk on Monday, April 1 with ZZZZZZZZ. He’s truly fantastic.

All best,

Fran”

The response was good in three ways:

1. A high-level person sent an immediate, personal response.

2. The message contained an apology.

3. The author suggested another program that the individual might enjoy.

Unfortunately, the goodwill these positive points might have earned was largely negated by the defensive and dismissive tone of the email. Sam responded:

January 4, 2013

Fiscal Cliff Disaster Averted, but Trouble Looms

We ended 2012 by surviving the so-called Mayan Doomsday. We began 2013 by driving off the so-called Fiscal Cliff before averting possible economic disaster. Congress passed the American Taxpayer Relief Act of 2012 which put the nation back on safe ground, for the moment.

Previously, I looked at the Act and provided information about what key elements mean for the nonprofit sector. Now, let’s look at:

What’s next?Road Sign by Madjag via Flickr

The Charitable Giving Coalition, chaired by the Association of Fundraising Professionals, as well as the AFP Political Action Committee, won a great victory when Congress preserved the charitable giving tax deduction and reinstated the IRA Charitable Rollover for 2012 and 2013. Everyone who was involved in visiting members of Congress, writing them, or calling them to advocate for the nonprofit sector certainly has a right to take pride in what the sector has accomplished.

However, before we get too carried away congratulating ourselves, let’s remember that the nonprofit sector continues to face danger.

The return of Pease Amendment provisions will make charitable giving a bit more expensive for wealthy donors. Higher taxes will also mean that donors will have less money with which to give. As a result, organizations may face some challenges. But, these are challenges that we have faced before. We’ll just have to work a bit more creatively.

Unfortunately, there are other looming dangers.

Thelma & LouiseThe Fiscal Cliff legislation, which was originally supposed to decrease the deficit, will actually increase the deficit by $4 trillion over the next decade, according to the nonpartisan Congressional Budget Office. In other words, we’re still headed full-speed ahead to economic collapse which would be a disaster for the nonprofit sector and society in general.

Charitable giving has historically correlated to about two percent of Gross Domestic Product. If GDP growth continues at a slow pace, philanthropy is also likely to grow only modestly. If runaway deficit spending leads to another recession, we can expect a likely decline in overall philanthropy.

All Congress has done is buy a bit of time.

Republicans have signaled that they will address the issue of spending cuts within the next two months. In two months, Congress will have to vote on whether to increase the nation’s debt ceiling. President Obama has already said that any spending cuts will require an increase in tax revenue in order to garner Democrat support.

Having achieved a tax rate increase, The White House now seeks to raise additional revenue in other ways. For example, the Administration may want to apply the top tax rates to those earning less than the current threshold of $400,000 for individuals and $450,000 for married couples. Also, the Administration is likely to seek limitations on deductions, particularly for the “wealthy.” The Administration has previously expressed support for both revenue generating options. Now, it’s likely those proposals will resurface during spending-cut negotiations.

So, while the charitable deduction appears to be safe for the moment, that safety may only last for two months.

Think I’m being alarmist? Let me provide some perspective from the US Debt Clock:

In 2000 the deficit was $5.8 trillion, which was $56,150 per taxpayer.

In 2008 the deficit was $9.2 trillion, which was $85,893 per taxpayer.

In 2012 the deficit was $16.4 trillion, which was $145,620 for every taxpayer.

Now, the Fiscal Cliff deal will add another $4 trillion to the deficit over 10 years!

At some point, the American economy will either collapse, going the way of Greece, or the government will get its act together and control spending. I’ve heard a lot of talk during the debate over the Fiscal Cliff about the need to return to Clinton Era tax rates. Sadly, there was little talk of returning to Clinton Era spending levels, even as a percentage of GDP which would still allow for spending increases.

The situation must be dealt with for the good of the nation. Unfortunately, this may require some pain for the nonprofit sector in the form of a reduced charitable giving tax deduction and reduced direct grants to and contracts with nonprofit organizations.

On the floor of the House of Representatives, during debate over the Fiscal Cliff legislation, Democrats have already begun to argue for additional revenues, echoing statements this week from The White House. In other words, the nonprofit sector has made it out of the first round of debates. But, the second round is quickly approaching.

Challenging times remain immediately ahead.

August 29, 2012

Special Report: Ooops! Giving USA Identifies Its Mistake

[Publisher's Note: “Special Reports” are posted from time-to-time as a benefit for subscribers and frequent visitors to this blog. “Special Reports” are not widely promoted. To be notified of all new posts, including "Special Reports," please take a moment to subscribe in the right-hand column. Your email address will be kept private.]

 

The people who bring us Giving USA have announced that the latest edition of the report contains a clerical error.

In life, when one makes a mistake, it’s generally a good idea to admit it and, when possible, fix it. It’s impossible to be perfect. So, what separates the good guys from the bad guys is not who can achieve perfection. Instead, the good guys are defined by how effectively and honestly they deal with problems when they are identified.

I congratulate Giving USA for promptly correcting its error.

Here is the text of the email from Giving USA that explains the situation:

 

Dear Valued Giving USA Customer,

The Center on Philanthropy at Indiana University and Giving USA are committed to providing the most up-to-date data on charitable giving possible-and to doing so with transparency, accuracy, and accessibility.

It is for this reason that we are notifying you that the Center on Philanthropy has updated the Giving USA bequest and total giving data for the years 1998-2009 that were originally reported in Giving USA 2012, released in June of this year. The changes are necessary because an error in the bequest giving data for those years has come to our attention.

June 22, 2012

Giving USA 2012 Released, Donations Up Slightly

Total philanthropic giving in 2011 was $298.42 billion, up from a revised estimate of $286.91 billion for 2010.

That’s the finding presented in Giving USA 2012, the report just released by The Giving USA Foundation and its research partner, the Indiana University Center on Philanthropy.

While the uptick of 4.0 percent in giving in current dollars is positive news, it represents an increase of just 0.9 percent in inflation-adjusted dollars. At this rate of growth, it will take more than a decade for giving to return to its pre-recession 2007 level, according to Patrick M. Rooney, Ph.D., Executive Director of the Center on Philanthropy. Rooney was in Philadelphia to present the major findings of the report. Rooney stated:

The estimates for giving in 2011 are encouraging, but they demonstrate that charities still face ongoing challenges. In the past two years, charitable giving has experienced its second slowest recovery following any recession since 1971.”

Giving in 2012 and 2013 is likely to experience the same slow growth as we saw in 2011. On the same day that Rooney was in Philadelphia, the U.S. Federal Reserve issued its multi-year forecast of change in Gross Domestic Product. The Fed projects GDP will continue to grow at a modest rate. For 2012, the projected GDP growth rate is 2.2 percent. For 2013, the Fed projects GDP growth of 2.5 percent. This is important news for all Americans, particularly those in the nonprofit sector.

In 2011, giving was 2 percent of GDP. Since giving has been tracked, philanthropy has always been about 2 percent of GDP. If this correlation rate continues, the nonprofit sector can expect continued slow growth in philanthropy in 2012 and 2013 as GDP is projected to grow only modestly.

Once again, the majority of philanthropic dollars came from Individuals, who accounted for 73 percent of total giving, the same percentage as the prior year. If Bequest and Family Foundation giving is included, the percentage would be 88 percent.

Individual giving as a percentage of disposable personal income remained at 1.9 percent in 2011, the same as in 2009 and 2010; this is far below the high of 2.4 percent achieved in 2005.

The report estimates estate giving at $24.41 billion in 2011, a 12.2 percent increase over 2010 (8.8 percent increase in inflation-adjusted dollars). Bequest giving represented 8 percent of total giving. Two-thirds of Americans with a will have included a charitable bequest provision, according to Robert I. Evans, Founder and Managing Director of EHL Consulting Group, who co-presented with Rooney. Fluctuations in bequest giving in recent years are primarily due to the major changes in real estate and stock portfolio values. Rooney also observed that the 300 wealthiest deceased individuals determine whether bequest giving goes up or down.

June 20, 2012

Special Report: Indiana University Creating School of Philanthropy

[Publisher's Note: “Special Reports” are posted from time-to-time as a benefit for subscribers and frequent visitors to this blog. “Special Reports” are not widely promoted. To be notified of all new posts, including "Special Reports," please take a moment to subscribe in the right-hand column.]

 

Indiana University, home of the internationally respected Center on Philanthropy, is in the process of creating a School of Philanthropy that will grant undergraduate and graduate degrees.

In his September 2011 State of the University Address: Defining the 21st Century Public University, Michael A. McRobbie, President of Indiana University, said, “Based on our internationally acclaimed Center on Philanthropy, we are also moving to establish a full-fledged School of Philanthropy.”

In May 2012, the University granted Bachelor of Arts degrees in Philanthropic Studies to five students. These are believed to be the first-ever undergraduate degrees presented for Philanthropic Studies. The Philanthropic Studies program is, in part, now part of the nonprofit management program in the School of Public and Environmental Affairs. The University Trustees are currently looking at how to transition the Philanthropic Studies program to its own school.

Follow

Get every new post delivered to your Inbox.

Join 716 other followers

%d bloggers like this: