Nonprofit Board Crisis

Smithsonian to bring exec salaries to more within rules

The Smithsonian Board has decided to change the salary structure for its executive staff.  Salaries currently range to a high of $500,000 for its CEO and go as low as $158,000 (check the article to make sure these numbers are correct). 

The new salary structure is going to lower the particularly higher paid execs to within legislative mandates but not the CEO. 

How the salaries have been allowed to exceed federal rules in the first place I can't explain except to say that the board has been irresponsible and the feds haven't used their muscle. 

But lets put this set of facts (ok, opinion) aside, I still want to better understand the criteria that goes into keeping the $500,000 CEO salary and re-arranging the remaining salaries. There certainly is the reality that other US mega-museums pay even more than this for the caretaking of invaluable objects.  Excepting hospitals and universities and of course, some mega-churches, executive salaries rarely come close to the new Smithsonian amounts in the remaining nonprofit sector. 

So what gives?  Does the unique role of these nonprofit warrant high salaries?  Should there be another nonprofit tax code to accommodate these institutions' perceived need to match the corporate for-profit world's pay schedules?

Prosperity Gospel Churches Under IRS and Senate Review

The Chicago Tribune reports today that the IRS is currently calling on the mega Michigan Prosperity Church to turn over its records.  The answer: we will comply with a higher authority than the IRS - whatever that means.

Prosperity Gospel Churches challenge a wide variety of premises around faith with the short story being that you pay to play and if you do, you will be financially rewarded - mostly looks like a ponzi or pyramid scheme which usually means the later-comers get screwed.  But that's just one person's opinion.  My kudos to the IRS and Senator Grassley.

Nonprofit Nursing Homes Outperform For-Profits

The Hartford Courant reported that nonprofit nursing homes "had significantly more nursing care and better patient-safety records than for-profits. Nonprofits in Connecticut averaged 53 percent more registered nurses per 100 beds, 21 percent more nurses overall, and 31 percent fewer patient-care deficiencies."

I am not surprised and very pleased with these findings.  Nonprofits are mission driven, not profit driven and as such can be expected to provide the best quality health care. 

If the state thinks about this, the need for publicly supported and nonprofit provided nursing (aka health) care is evident.

International Olympics Committee Called On To Do More Than Mission

A lot of folks especially in the US seemed to think that the IOC should have been more politically active intervening and speaking to civil rights and humanitarian issues as part of its work in the recently completed Olympics.

In reflection, I think not.  The IOC has a mission: essentially, to put on the Olympics - an event that by its nature gets into the business of peacemaking, but that is not I believe its inherent mission.  I believe the IOC was correct to stay on the sidelines and let the many other groups whose mission is focused on civil rights and humanitarian issues "speak truth to power".  I applaud the IOC for pursuing and sticking to its mission and illustrating what it means to be a reasonably great nonprofit. 

United Way Trying To Be Something Else

The United Way doesn't believe it's job is to continue to support the organizations that it has been supporting for years.  Many of these organizations were there from the beginning making agreements that changed their fundraising so that each and the community would benefit especially from a reduced number of solicitations.  Sort of a win - win.

The United Way has now decided it knows better than its "members" and while it essentially will job-out what needs to be done to solve specifically identified social ills.  Win - win?  Maybe not.  By taking this step the United Way radically increases the number of solicitations that will take place each year in any given community.  It also reduces another role it fell into: helping the community know how its nonprofits were doing, programmatically and financially.  The United Way brought a kind-of honesty to the nonprofit community.

Will these benefits go away now?  They just might.  And will the United Way really be able to achieve the social good it has set as its goal?  I for one will be surprised for any number of reasons.  But maybe we just have to wait and see and in the meantime, prepare for an onslaught of charitable solicitations.

Media Broken as Nonprofits Explore Fixes

Interesting article today focused on a "pay-as-you-go" nonprofit journalism effort by a San Franciscan and former MacArthur fellow who is offering groups the opportunity (spot.us) to identify stories that need to be researched and told for a fee. 

A sad day indeed that this is the future of the media but maybe in my naiveté maybe it's the way it's always been and I just didn't want to believe that the only way stories in the news really get in the news is when someone pays, overtly or covertly.  On the other hand, maybe pay-as-you-go news will make stories more available to larger audiences.  This, at the very minimum, explains why it's up to nonprofits to carry the banner for honest open journalism.  The open market just doesn't want to bear the cost and the public sector is for sure the wrong folks to be engaged.

Being Religious and Nonprofit

Two New York Times articles over the past week highlight some interesting delimnas for the world but not nearly necessarily as much for the nonprofits. 

The articles, one focused on the Abyssinian Baptist Church and the other on the Olympic Committee and the Archery Team/Coach, both discuss what I would label as policy issues.  

The Church, in New York, has a really large economic development corporation that has, over its life, had a significant impact on Harlem.  At the same time, it, like many economic development corporations, has not pleased every resident.  So what's new?  Well, I believe the Times went the extra step to suggest that the religious roots of the corporation should have driven it to somehow be more neighbor-friendly than it was.  And, I do believe that, as a corporation of the Church, policies guiding the work should clearly reflect the church's values.  More importantly, from what I can judge, the corporation's policies very much represent the values of the Church.  Really not much of a story to tell so I don't get the point.

The Olympic Committee has a different challenge.  It appears that the archery team coach is very religious, favors team members who follow the coach's lead (get baptized, read the bible) and maybe even, from the surface, is more supportive of those who follow the archery coaching instructions along with the religious instructions.  Problem? Yes.  The job of the coach is to prepare physically and mentally but spiritually?  That's the chaplain's job.  If these athletes need or want spiritual guidance, they should turn to the chaplain or whoever they believe best provides this type of support.  Their coach should not be the source and Olympic Committee policies should say as much and the policies shoudl be implemented accordingly. 

1/2 OF Nonprofits Running Dubious Programs

I am not really certain where the biggest offense lies.

A Chicago Tribune investigation found that nearly 1/2 of 48 grantees of "tutor" grants were running "dubious" programs or would not show how they spent the money.  Only 11 of the grants went to established programs with a history of tutoring school-age children.

Now clearly there's a whole lot of accountability issues here but is it really possible the 24 nonprofits just weren't doing their jobs?  Much to be sad about if true, for a sector that is about filling the gaps for folks who have no place else to turn.  This suggests that there are serious governance and management issues to be addressed, first as one would hate to see this much money ($20,000 grants) go away.

And go away they might, as this lack of accountability is profound and the process for distribution of these special funds is even more suspect than how (or if) they get spent.

Zyzzyva - unmet market need

Zyzzyva (rhymes with dizzy-va) is a testimony to what may be the destiny of all newspapers and magazines - they will become nonprofit supported by donations and grants

Zyzzyva's story can be viewed in the LA Times. The story tells of a literary magazine ushered forth by an ex-Bechtel communications department employee still publishing after 24 years.  To me it is the reasonable descriptor of why nonprofit: there's no call by the voting public for such a resource and there's no proven profit opportunity for the for-profit sector. 

Hence, a nonprofit journal - community supported and in the passive sense - community governed.

So What to Foundation Exec Bailout of ACORN Embezzlement

The New York Times reported that Drummand Pike, the esteemed Exec of the Tides Foundation is helping bailout the guy who stole bunches ($1 million) of money from ACORN.

I say, "so what"?  If Mr. Pike sees it as the right thing to do, for whatever reason, more power to him.  Making ACORN whole is important to the community organizing field - however it happens. 

I do hope though that Mr. Pike  will also apply his knowledge of nonprofit management to helping ACORN consider adopting the systems and processes necessary to ensuring that theft of this sort is not so possible in the future.