Nonprofit Board Crisis

Trustees Fail Test of Prudence #NonprofitBoards

While Rome burned, Nero fiddled.  This adaptation of a history fable (the fiddle had not been invented yet) provides a lesson about imprudent and clearly not a risk adverse nonprofit boards like the one at Liberty University (https://www.liberty.edu/trustees/) who essentially allows its president to do what he wants while playing serious conservative politics.  The latest example, Jerry Fallwell has not shut down Liberty University during the CIVID-19 crisis refusing to acknowledge the risk he has placed on his students, faculty and staff and the town.  And who's to blame: his trustees who effectively have given MR Falwell carte blanch in the name of Jesus.  This group of trustees FAILS in every way to meet the most basic of criteria in providing fiduciary care.  In my opinion it was on them to tell MR Falwell to shut it all down in the interest of everyone that could be harmed - they have failed the test of prudence - doing what other institutions facing similar situations might (have) done.  If my son or daughter or family member dies as a result of such poor decision making, I would sue and join with other to sue to finally bring both Falwell and his trustees to their knees.  

Here's the New York Times story.

Transparency and Advocacy #NonprofitBoards

A pandemic like CIVID-19 presents the opportunity by government and nonprofit officials to act behind the curtain in-secret.  Despite many electronic and digital solutions to keeping citizens and donors informed as to what their government leaders and volunteers are doing (not always in their best interest), and I'm thinking in particular of the Federal Government) but as the following Guam (yes the place) News highlights, not everyone in-charge is interested in acting in "out" best interest.  Please boards, keep all informed - use your websites to post what is it you are doing.  Use emails and postal service methods to keep all up-to-date.  There is no excuse, not reason, to go dark so that those who want can do what they want until we all found out later.  Advocacy remains an critical duty on the parts of nonprofit boards to ensure government is serving not dictating.

Here's the article which has my worries correctly increasing.

 

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Shorten Guam residents' wait for COVID-19 relief

Despite their partisan and ideological differences, lawmakers in Washington, D.C…

 

Editorial

Government transparency needed now more than ever

• The Guam Daily Post
• Mar 29, 2020
 

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There are ways to get things done in this government without limiting the people’s knowledge of their government’s actions.

We would argue that it's particularly at a time of crisis when the government must take pains to let its people know what they're doing, how and why. 

In Executive Order 2020-06, Gov. Lou Leon Guerrero suspended several sections of the Open Government Law, which work together to ensure transparency among elected and appointed officials in their decisions on policies and tax-dollar expenditures that affect our daily lives.

 

The Open Government Law, among other things, requires government meetings to be announced to the public five days in advance to allow the public opportunity to participate in the discussion on policies that could impact our island and their lives.

 

The idea of ensuring residents have the opportunity to participate in public debate has been taken further by various boards, such as the Guam Education Board, which holds its meetings in the evening when most residents are off from work. Also, they hold their meetings at various schools throughout the year – bringing the discussion closer to where people live and work. They and other board agencies such as the Guam Environmental Protection Agency also have started to livestream meetings as another measure to ensure the people of Guam are aware of the discussion and the decisions that are made.

The suspension of any portion of the law that is the foundation of government transparency is a policy headed in the wrong direction.

The executive order caught the attention of the Vigilance Committee, which is led by Michelle Armenta. The local organization, which aims to hold local officials accountable, is concerned that the executive order “allows intolerable mischief.” The committee said the executive order suspends the very policies that allowed the media and the public to uncover violations such as secretly approved salary increases by the Consolidated Commission on Utilities.

The committee also requested "a copy of any and all public records, citing specific sections of the Organic Act of Guam, laws, and rules and regulations, which grant you, the Governor of Guam, the authority to suspend the Open Government Law in part or in whole."

We look forward to the governor’s response to this request for information, which should be due early this week.

 

New executive order

A follow-up executive order the governor announced on Saturday, March 28, includes a section that requires government boards and commissions to send notices of their meetings to the Office of the Attorney General to be posted online. There’s no other required publication site.

 

There’s also no time frame as to how long that notice must be publicly posted. Executive Order 2020-07 only states that the notice to the AG’s office “shall be made in advance of the scheduled meeting so that there is reasonable time for the posting on the website to occur.”

Conceivably, the hospital or education boards could send a notice of a meeting to the AG’s office at 8 a.m. for the AG’s staff to post online by 8:30 a.m. and the meeting would then take place at 8:35 a.m. or 10 a.m. Either scenario seemingly meets the requirement of the executive order, but neither truly ensures the public is aware of and able to make the time to attend the meeting.

Further, Executive Order 2020-07 reiterates that the “suspensions articulated in Item 5 of Executive Order No. 2020-06 are in effect.”

Reducing transparency at a time when we want sunshine in all the nooks and crannies of the government, particularly in light of this public health emergency, makes no sense. One local resident told The Guam Daily Post a few days ago that she felt the government was misleading the community with press releases that noted the people who tested positive for COVID-19 were in isolation, only for mayors to reveal that a number of patients were actually told to self-quarantine in their homes.

 

Executive Order 2020-06 and 07 do nothing to raise confidence that the government is willing to openly share what it’s doing and why.

What's more concerning is the governor, in explaining her decision to suspend sections of the law, said there’s a lot of “bureaucracy” – such as announcing a meeting to the public – that she implied slows the government’s ability to act.

"Believe me, up at Adelup and Homeland Security, there are times when we have to make quick decisions and we need to bring in more people from an agency to make that happen," the governor said during a press conference. "So I just want to make sure we are given that opportunity and not have to follow the five-day rule."

We point out that in the midst of the COVID-19 crisis, the Public Utilities Commission had no problem properly providing public notice of a meeting that provided the media and interested island residents an opportunity to attend.

The Vigilance Committee acknowledges the elected officials’ difficulty in responding to the COVID-19 crisis. However, the committee notes, "draconian measures that abolish, even temporarily, the public's right to know what its government is doing cannot pass without the most strenuous objection."

We agree.

And we join the committee in asking the governor to revoke any and all suspension of any section of the Open Government Law.

Nonprofit Board/Staff Work #NonprofitBoards

Here's a piece from the Forbes Nonprofit Council that provides some guidance on how might a staff and board support each other.

 

Forbes Nonprofit Council members offer strategies on how management staff can work together with board members.

 PHOTOS COURTESY OF THE INDIVIDUAL MEMBERS.

1. Promote Concise And Consistent Communication 

Remove the barriers to clear communication. Board members are donating their time and talents for long-term sustainability. The staff donates their critical thinking to be relevant, effective and responsive daily. Discover how your staff and board best move information and commit to a regular schedule and format of reporting. - KellyAnn Romanych, Veterans Legal Institute 

 

2. Start With A Focus On Clarity 

I am interested in advancing how to create a high-performance nonprofit enterprise. It starts with clarity. The board of directors’ focus is on governance with regard to the mission and strategy of the enterprise. Management focuses on the operational execution and strategy of the mission. Management must support the board's role in governance and boards must support management's operational role. - Jesse Bethke Gomez, Metropolitan Center for Independent Living 

Forbes Nonprofit Council is an invitation-only organization for chief executives in successful nonprofit organizations. Do I qualify?

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3. Be Proactive 

Be proactive and consult with at least one board member with relevant experience in the area you’re looking to address. Do not wait for the board of directors to take the initiative as you may not like the actions that they recommend. Likewise, do not delegate this activity to your direct reports as you may get cut out of the loop and be presented with a situation that you must then try to undo. - Rupert Scofield, FINCA International 

4. Develop A Strategic Agreement 

Make sure your organization has a strong strategic plan that is developed by the board with staff input and supported by both. Strategic planning is a roadmap to achieving the vision and mission of the organization or at least getting closer to it. Using a strategic plan and the indicators of success will allow the organization stay on course, allocate resources and assign accountability to all parties involved. - Magdalena Nowicka Mook, ICF (International Coach Federation) 

5. Engage With Board Members Individually 

Diversity of thought on boards is valuable; however, it sometimes leads to a lack of decision making. To ensure efficient and effective deliberation, engage with each board member individually. Craft questions and decisions such that it addresses all possible concerns and then have an integrated decision-making meeting. Ultimately, if you've picked the right board, decision making should be easy. - Rosemarie Truman, The Center for Advancing Innovation 

6. Ask For Advice Strategically 

Keep your board meetings short and action-oriented. The longer the meeting, the more the board will weigh in on management issues. I always try to be clear with my board about where I need their advice. Asking for their advice allows them to weigh in, but not feel that the ultimate decision is theirs. It's a great way to honor the distinctiveness of my management role and their guidance role. - Bill High, The Signatry 

7. Facilitate Communications Among Board Members 

Board members are usually busy volunteers. Communicate frequently with them and help facilitate their communications with each other. Work closely with the chair and committees to ensure meetings are focused on strategic issues. When recruiting new members, work with the board to nominate individuals who meet gaps in board capabilities and ideally have prior board or executive experience. - Anu Kumar, Ipas 

8. Equip The Board To Serve As Ambassadors 

Communication is critical. I provide helpful information to equip the board with the knowledge they need to serve as ambassadors for our work, meaning they know the issues we’re tackling and can speak to our approach. I also try to anticipate what questions might arise and proactively share those answers in meeting prep materials. Lastly, I check in periodically to collect feedback so the lines of communication remain open. - Acooa Ellis, Greater Twin Cities United Way 

9. Draw And Maintain 'Swimlanes' For Both Parties 

I've said many times that good fences make great neighbors. This is certainly true in drawing lines or the swimlanes between two critical constituencies in nonprofit work: management and governance. The roles of these two groups are distinct. It is important to create structures for effective feedback and dialogue—never letting either get too much in front of the other. - Arthur Mills IV, New Teacher Center 

10. Engage Board Members In The Mission 

I use board committees to engage my board in the mission, but not in the day-to-day duties of the mission. Leadership staff serve as liaisons to the committees and perform the daily tasks. Management staff report to the committees on specific projects. This provides the leadership team with board management experience and exposure, giving board members the opportunity to touch the mission. - Kimberly Lewis, Goodwill Industries of East Texas, Inc. 

11. Be Intentional About Board Updates 

I used to be an open-book CEO who shared too much too soon. This mode of communication unintentionally invited our board to contribute to the how and they eventually crossed over from governing to managing. Board involvement on the management side made achieving goals much slower. I now take goal updates to the board once there are outcomes to share. Board input at that time is appreciated! - Duana Patton, OHIO DISTRICT 5 AREA AGENCY ON AGING INC 

12. Clarify Roles To Reduce Friction 

There must be clear expectations established for board members and management staff alike. If it feels like there is friction between the board and management staff, a good place to start is a series of listening sessions to help both groups better understand where the other is coming from. Next, create a plan for mapping out a collaborative way forward that may require some adjustment to roles. - Jamie Aten, Humanitarian Disaster Institute 

13. Let Everyone Get In The 'Boat' 

Adopt a strategic plan where all stakeholders (staff, board members, sponsors and volunteers) can see the direction, goals, benchmarks and accomplishments. A collaborative strategic plan approved by the governing board affords a chance for everyone to get in the boat, set the compass for success, grab an oar and start rowing toward the organizational victories. - Aaron Alejandro, Texas FFA Foundation 

 

 

Forbes Nonprofit Council

Forbes Nonprofit Council is an invitation-only, fee-based organization for senior-level executives in successful nonprofit organizations. Find out if you qualify at forbe…

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COVID-19 and Governance #NonprofitBoards

The following seems worth sharing given all that is going around us:

Free Crisis Communications Guide for Nonprofit Leaders Dealing with COVID-19

 

The chapter on Crisis Communications from Ben Delaney's Nonprofit Marketing Handbook has been released at no charge for leaders of nonprofits organizations to help them deal with fallout of the COVID-19 pandemic.

Mar. 14, 2020 / PRZen / OAKLAND, Calif. -- With nonprofit leaders facing greater stress than ever due to the COVID-19 pandemic, their communications with stakeholders has become a critical aspect of mission success, and even the ability of their organizations to survive.

With quarantine-in-place orders rapidly expanding, those least able to help themselves are being forced to deal with the impact of this pandemic with few resources, and a sense of being discarded by a society. The nonprofit organizations that serve them are also suffering as their workers are forced to stay home, making program delivery extremely difficult.

At this time, nonprofit leaders must communicate clearly with their boards, funders, staffs, clients, government agencies and the public. They need to explain the steps they are taking to keep their staff and clients safe. They must explain continuation planning, and what they are doing to adjust to this new normal. The continued existence of their organizations may depend on how well they manage this crisis, and a large part of that management is clear, open communications.

Said author Ben Delaney, "Nonprofit marketers need every tool they can find, so that their small budgets can stretch to do the work that is needed. A lot has changed since I first wrote this book. Nonprofits are facing crises of all sorts, most of all the COVID-19 pandemic. Everyone in nonprofit communications needs this information."

He added, "How you handle a crisis is critically important. Every member of the leadership team needs to be aware and involved, and those in Marketing and Communications can be vital to a successful resolution of the situation. In this chapter I provide guidance based on my personal experience as an Executive Director managing nonprofit communications during crisis."

The free chapter on crisis communications is available to all nonprofit leaders and communications staff at no charge.

Ben Delaney's Nonprofit Marketing Handbook, Second Edition is available from Amazon, Barnes and Noble and Kobo as a paperback book, eBook or in Kindle format. It may also be ordered from local bookstores. The ISBN for the print edition is 978-1-5136-3554-5.

For more information and your free copy of this valuable chapter, visit nonprofitmarketingbook.com/crisiscomms.

Follow the full story here: https://przen.com/pr/33335487

Millennials and Nonprofit Governance #NonprofitBoards

The following is Eugene Fram's latest and the topic: millennials as CEO's.  While the subject of millennials as employees is capturing many of us old-timer's imagination, thinking about this group in terms of management and more importantly in relationship to nonprofit boards as a special aha.  Standouts in Dr. Fram's thinking is the question of the frequence of performance appraisals (just how frequently praise should be allocated) and the issue of investing in technology at higher levels plus the expectations of presence in the workplace.  All of these are important questions and could challenge traditional expectations and behaviors especially by the board chair.  This is worth a read.

WHAT TO EXPECT WHEN THE NEW NONPROFIT CEO IS A MILLENNIAL!

What to Expect When The New Nonprofit CEO Is A Millennial!

By: Eugene Fram   Free Digital Image

The nonprofit’s CEO, a baby boomer or genXer, is about to retire or leave for another position. The board has engaged a new CEO a millennial person born after 1980. * His/h age is probably late 30s or possibly early 40s. What changes can the board expect from this new professional?

Following are my estimates based on some suggestions from psychologist, Dr. Jon Warner, http://bit.ly/1IFXK7u plus my 10 years experience collegiate teaching millennials.

Relationship with the Organization:
• Works at home/works anywhere – Don’t expect the CEO to be continually in the office, as much as his/h predecessor. With the Internet and other electronic aids, the CEO can work in a variety of locations and times.
• Outcomes – He/s will expect the board to define the outcomes and impacts the CEO and organization should achieve. Hopefully, they will be established in a collaborative fashion with the board. In addition to the financial and other similar outcomes, She/h will want to help define and be judged on qualitative outcomes, such as community commitment, successful advocacy, or any of the other honorable, but inherently vague mission based goals that nonprofits frequently adopt. http://bit.ly/OvF4ri
• Praise – Millennials have been raised on praise since infancy, and this need will probably linger into adulthood. Consequently board evaluations of his/h performance may have to take place more than once a year, especially during the early years. An executive friend reported that one of her team members complained that she had not praised the team member for six weeks, after a well eared annual review.

Communication Approaches
• Communications channels – Information sharing will become more important with the decline of hierarchy-structured organizations that have been used in the past. Records and operations will become more transparent, and there will be fewer department and functional boundaries. Older board members may find this atmosphere troubling.

Approach to Teamwork
• Roles – They will be flexible and changing. The CEO will expect staff to step in and help occasionally with tasks that may be outside the staff’s comfort zones. Social workers, for example, may be asked to take on some marketing functions temporarily, etc.
• Collaboration – Team leadership will change frequently. Conditioned by fast changing school semesters and frequent evaluations, doing the same task regularly is seen by millennials as being “boring.” Some board members may be uncomfortable with the constantly shifting staff scene and see it as being dysfunctional. Its effectiveness will have to be evaluated on the bases of outcomes and impacts.

Skills and knowledge set
• Results – Based on the outcomes designated by the board and CEO (see above), results will become more important than the processes for accomplishment, as long as the outcomes are achieved ethically.
• Client focused – The millennial generation, being bottoms-up driven, will place more emphasis on client satisfaction, understanding that in the nonprofit arena, the client receiving the service may be different from the client financially supporting the service.
• Training and development – Much less formal training will delivered just in time as needed. This will be helpful to nonprofits where board supported training development resources are meager.

Use of technology
• The Gap – There will probably be a substantial budget gap between what the CEO wants to spend on new technology, and the board’s focus on allocating budget dollars to benefit clients. How this will be resolved is difficult to estimate at this time. No doubt, as management and staff, with an increasing number of millennials, view the CEO with the latest technology, will also want to have the same resources.

As more millennials achieve nonprofit CEO status, their values and outlooks may disturb some of the older board members. Although their working habits and values, at first, will initially puzzle the older cohorts, their dedication to the mission will outstanding. They and their millennial staffs can do a great deal to improve service to clients, in ways quite different than in the past.

* Baby Boomer: Born between 1945-1965; GenXer: Born between 1966-1979; Millennials Born between 1980-1995; Generation Z Born 1996 onward.

Don't Be Money Blind #NonprofitBoards

Don't be money blind is the message offered in this Advocate Messenger opinion piece that speaks about one circumstance in particular where the nonprofit board either just didn't understand or din't ask about the state of financial affairs and what really was happening was embezzlement to a pretty hefty tune for a modest sized nonprofit.

Financial literacy is not a "thing" singular to individuals.  Nonprofit board members have a fiduciary responsibility to ask questions to oversee for the public, the use of resources.  Financial illiteracy is not an excuse for failed oversight.

 

 

Nonprofits need real financial support and accountability to succeed

By Advocate-Messenger

Email the author

Published 4:57 pm Thursday, March 5, 2020

 

Y

By ELAINE WILSON-REDDY

Contributing columnist

I have worked in different capacities in the non-profit, tax-exempt world for 17 years. I’ve worked for large non-profits like the Alzheimer’s Association, and small ones, like The Great American Brass Band Festival. In 2016, I had the great privilege of starting an organization for children who don’t have access to preschool in Boyle County called The Gladys Project, named after my mother and grandmother.

Non-profit organizations have several things in common: Their supporters are die-hard and unwavering. Many of their directors are from the die-hard and unwavering pool of supporters. The orgs are always searching and competing for new funding.

And it is often a challenge for the boards of directors to view their organizations from an objective, fact-based, data-driven perspective. Sadly, hard decisions almost always come down to money. 

We don’t like to talk about money in the nonprofit world. It seems to tarnish the image of doing good for those who are served. However, nonprofits are businesses. Money allows them to work their missions. The passion of the people often creates a blind spot when money is mentioned.

I worked as a fundraiser for Big Brothers Big Sisters of the Bluegrass (BBSS) in 2007-08. Bowl for Kids Sake was the major fundraiser for BBSS. My territory included Boyle County and surrounding counties, but I also helped with other bowling events within other Bluegrass territories. I never touched the money. The office manager was at every bowling event. She collected the bags of coins from children and the checks from adults and sponsors.

Even though I didn’t handle the money, I kept a general tally of how much was raised at my events. As we progressed through the year, there were persistent money issues. Staff was let go because the organization couldn’t support the salaries and benefits. Program materials became scarce.

These issues made no sense given the amount of money being raised. Another BBBS fundraising worker and I started asking the director of development (our boss) questions. Those questions were deflected, ignored and definitely unwelcome. She and I sat through the BBBS annual meeting with the full staff and full board. We listened to our boss make a lot of grand statements about how wonderful it was to serve these children in the Bluegrass. We also listened to him present a wildly inaccurate financial statement.

My fellow fundraising worker and I became more persistent. We met with the executive director. I talked to the board chair on the phone for over an hour. Something wasn’t right with the money and no one wanted to talk about it with us.

The final straw came when we asked to see the bank statements. She and I were simultaneously fired — she from the Lexington office and I from the Danville one.

The org continued to struggle until the day, about six months after we were fired, that a bank employee called to verify a signature on a BBBS check.

As it turned out, the office manager had been embezzling funds for about 18 months to the tune of over $400,000. You can research this in past newspaper articles from 2008.

The very sad part of this story is if anyone within BBBS had done their due diligence, the damage would have been far less. The board fully trusted the office manager, asked no questions, didn’t question the financial statements and never looked at the bank statements.

I share this story NOT because I think funds have been mishandled within our local nonprofits, but to raise the issue of money-blindness in the nonprofit world.

We like to think that those who sit on the boards and those who volunteer are completely trustworthy and always tell the truth.

Boards of directors are the fiduciary agents of non-profits. Truly healthy nonprofit boards welcome questions about their missions, operations and finances. Healthy boards function with clarity of the full weight of their responsibility to those who are served by the organizations. This is not a small responsibility no matter the size of the organization or its budget.

Grant availability fluctuates with the economy. Grant funders are notoriously finicky. Many grants funders won’t award money to festivals or for general operations. Grants disappear at the drop of a hat. I read a Facebook post from Wilderness Trace Child Development Center that said two grants they normally have received are no longer available. That’s hard to come back from.

I have seen several online petitions asking for virtual signatures in support of the child development center. If you truly want to support the WTCDC, the Brass Band Festival or whatever your favorite nonprofit may be, write them a check. Write them a check once a month for $5, $10 or $25. A signature on a petition doesn’t pay for professional services for children who require special attention. A signature on a check will.

How much do you love the WTCDC, the Great American Brass Band Festival, The Gladys Project, or your pet project? Send them money. Every month. That is where the rubber meets the road.

If you are a board member, start asking questions about everything. If you don’t know how to read a financial statement, ask someone to explain it. Don’t be money blind. Get trained and know that your allegiance is not to the executive director, but to the organization and those it serves.

“A person may cause evil to others not only by his actions but by his inaction, and in either case he is justly accountable to them for injury.” — John Stuart Mill

Elaine Wilson-Reddy, JD, is a professional educator, consultant and advocate. She lives in Danville.

No Such Thing As Bad Publicity? #NonprofitBoards

PT Barnum is often credited with the phrase "there's no such thing as bad publicity" and while the truth varies, this is for sure not correct for the Florida Coalition Against Domestic Violence board and executive.  The board, in its dubious wisdom allotted their executive more than $7.5 million over three years including paid time off of about 1/2 this amount.  It's unclear how a nonprofit board could justify this kind of payout to an organization with pretty much one source of revenue (government) as I do not like to presume that the person in question didn't bring significant added value and that the board didn't do its homework to identify what was indeed comparable salaries and payouts of similar organizations.  At the same time, to the best of my knowledge, there's is little to no justifiable explanation.  But the first question that really must be answered is about performance: of the exec and the organization.  How'd they do?  And only then should we judge the money.  And then, we can talk about consequences beginning with the board.

Here's the Tampa Bay Times article with the details.

Paying nonprofit CEO Tiffany Carr $7.5 million was no mistake

There were plenty of opportunities for someone to step in. Why didn’t they?

 

By Graham Brink

Published Yesterday

Updated Yesterday

There’s no denying that Tiffany Carr has chutzpah. The former CEO of the Florida Coalition Against Domestic Violence managed to juice her paid time off to the tune of more than $4 million, and convinced her cronies to go along. That’s no easy feat.

The sad episode wasn’t a mistake or a misunderstanding. It wasn’t a bad decision made in a moment of desperation. It wasn’t a temporary lapse in judgment. It wasn’t the white-collar equivalent of a smash-and-grab robbery.

No, this took planning — an ongoing and conscious effort to game the system. It was a clear breach of the public trust that involved multiple people in high-level positions. Some were knee deep in the muck. Others looked the other way, or didn’t do enough to speak up.

Funneling the money to Carr involved immoral and unscrupulous behavior that a fourth-grader knows is wrong.

Carr, 51, wasn’t the head of a Fortune 500 company with billions of dollars in profits. She ran a non-profit that was supposed to spend taxpayer money to help victims of domestic violence.

Carr was a rising and well-connected star in political circles in the early 2000s. In 2003, the state chose her organization as the single clearinghouse for about $52 million in annual state and federal funds.

In 2012, Gov. Rick Scott balked at Carr’s $300,000 salary. But that pales against what’s happened more recently. In the last three years, the nonprofit paid her $7.5 million, according to reporting by the Times/Herald Tallahassee Bureau, including about $4.9 million for paid time off and other compensation beyond her annual salary. A couple other executives also received ridiculously inflated six-figure payments for paid time off they didn’t use.

RELATED: Tiffany Carr's many homes.

A compensation committee, made up of Carr’s hand-picked board members, sanctioned the lucrative deal. The members also allowed Carr to claim she had a brain tumor, despite providing no medical evidence.

The scheme, which one board member testified included altering records, allowed Carr to work nearly exclusively from her home in North Carolina, until she resigned in November.

The Tampa Bay area has witnessed similar scandals recently — respected leaders of small quasi-governmental agencies consolidate power and take advantage of lax oversight. Some enrich themselves. Others turn their agencies into personal fiefdoms. Rodney Fischer and Edward Peachy spring to mind.

Fischer was the former long-serving executive director at the Pinellas County Construction Licensing Board who ran an agency that mismanaged its finances and disregarded its own rules, a Tampa Bay Times investigation revealed.

Peachy was in charge of two local career placement agencies before another Times investigation revealed a slew of problems, including how the agencies paid out $3.1 million in bonuses and took credit for finding jobs for thousands of people who never sought help.

Like Carr, Fischer and Peachey were considered experts in their fields. They also had boards that enabled their behavior or were too detached to know what was going on.

Gov. Ron DeSantis and other state leaders appear serious about figuring out what happened at the Florida Coalition Against Domestic Violence and possibly clawing back some of the money. Criminal charges are also a possibility.

 

Bad Governance: A Model #NonprofitBoards

The following Washington Post describes bad nonprofit governance - maybe not the worst in history but definitely nothing for other boards to emulate.  Bottom line: this board blew $28 million and more - and yes, the board blew the money with a combination of lack of oversight and bad judgement.  Couldn't be worse.

A longtime D.C. nonprofit celebrated a historic $28 million gift. Now it’s struggling to stay afloat.

By 

Justin Wm. Moyer 

Feb. 28, 2020 at 1:08 p.m. EST

A 138-year-old District charity that received a $28 million bequest is being sued by former employees who allege they are owed unpaid wages as the nonprofit battles for survival.

Family Matters of Greater Washington, one of the city’s oldest nonprofit organizations, was founded in 1882 to fight poverty in the District. Five years ago, it served more than 24,000 clients, operating programs for seniors and mental-health clinics in the District and Prince George’s County, as well as a summer camp for disadvantaged children in Virginia.

The charity is now struggling to stay afloat as four former employees filed a lawsuit in February in D.C. Superior Court, alleging they have not been paid since December and are owed tens of thousands of dollars amid “a steady decline in its funding and financing.”

 

 

In December, according to the suit, Family Matters chief executive Thomas Johnson told former employees that the charity was closing and said that workers who stayed until Jan. 10 would receive a severance, which the workers claim has not been paid.

“Employees were intentionally kept in the dark by Defendant Johnson as to the organization’s declining fortunes,” said the suit, which seeks unpaid wages and three months of severance and insurance benefits. “Many of the employees … could tell that something was seriously wrong.”

Johnson said in an interview that workers would be paid “imminently” after the charity resolves an issue with a payroll contractor. He said two staffers remain at the organization, down from about 100 employees five years earlier.

 

“We aren’t going out of business,” he said. “We are undergoing a major reorganization. We have had some severe financial strains that are structural. We are looking to try to address those over the next two to three months.”

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Of the nonprofit’s financial woes, he added: “I don’t think there’s a simple explanation.”

Philanthropist Richard A. Herman leaves fortune to local charity, symphony, opera

Family Matters’s reversal of financial fortunes comes seven years after it celebrated a $28 million bequest from D.C. philanthropist Richard A. Herman.

Herman, the introverted scion of a railroad family who died at age 100 in 2012, left 60 percent of his estate to the organization — one of the largest gifts to a local charity and more than twice the nonprofit’s annual $12.5 million budget.

 

“I started crying,” said Tonya Jackson Smallwood, then-president and chief executive, at the time. “I dropped the phone, and I fell to my knees on the ground in my office.”

In the years after the bequest, some former employees alleged the charity’s executives spent too much as the nonprofit lost contracts for services it provided.

 

Rashida Winslow, a plaintiff in the suit, said she came to the charity in 2014, serving as clinical director of its locations in the District and in Oxon Hill. She said the nonprofit’s leadership “ran Family Matters as if it was a Fortune 500 company” and sold its headquarters on 16th Street NW to rent an expensive Chinatown office.

 

District property records show the 16th Street headquarters was sold in 2015 for $13 million. Johnson said the building was sold to pay off the mortgage, and the nonprofit “didn’t retain anything from the sale.”

Tax documents that nonprofits are required to file show the charity netted $26 million in 2013, the year of the bequest, but had millions of dollars in annual deficits the following years. In 2017, the most recent year for which numbers are available, Family Matters spent about $3.3 million more than it brought in, tapping money in savings.

Smallwood, a former Freddie Mac executive, was paid more than $350,000 in 2017, according to tax documents — an increase from $265,000 a year earlier. In 2014, her husband, Jerry Smallwood, was also paid by the charity as a construction and real estate contractor, earning more than $120,000 that year.

 

Smallwood, who left the charity in 2018 after an auto accident, did not respond to requests for comment. Her husband died in 2017.

Johnson traced Family Matters’s financial problems to 2017, when Smallwood’s accident and her husband’s health problems made her “not available for most of the year,” he said.

He said her salary was set in consultation with an outside contractor who made comparisons with similar-size organizations. Payments to her husband were approved by the charity’s board of directors.

Family Matters also ended programming in 2017 at Camp Moss Hollow, its 400-acre property in Fauquier County, Va., and put the land up for sale. The property, once home to an annual camp for disadvantaged youth, is on the market for $2 million.

 

From 2001: Katharine Graham: A Friend to Kids

The Washington Post had a long relationship with the camp. Former Post columnist Bob Levey, and in recent years John Kelly, sought reader contributions for the camp during the summer in a column traditionally used to solicit charitable donations. Kelly said he stopped soliciting donations for the camp in 2014 after it received the $28 million gift.

Johnson said the nonprofit suffered after The Post stopped seeking donations for the camp and after losing contracts with D.C. Child and Family Services in 2018, worth $3.2 million annually. A spokeswoman for the city agency said the Family Matters contract was not renewed because the agency reduced its number of providers.

D.C. foster care to consolidate Maryland monitoring services under one agency

Family Matters had earlier been sued at least twice by employees who alleged they were wrongfully terminated after raising concerns about financial malfeasance.

In 2015, a former chief financial officer and a volunteer coordinator filed a federal lawsuit, claiming they questioned alleged “financial improprieties” and were fired in retaliation. That suit was dropped in 2016.

In 2018, the organization’s former senior chief of development, communications and international development, filed suit in D.C. Superior Court, alleging she was terminated after telling Smallwood the charity might lose government contracts because of “noncompliance with managerial and financial requirements.” The case was settled in 2018 after being moved to federal court.

As the most recent lawsuit over alleged unpaid wages goes ahead, the nonprofit’s departure has left a void.

Andrea Murray, a former psychiatric rehabilitation coordinator at the organization’s Oxon Hill clinic, said staff scrambled in the two weeks before it closed around the holidays to find new caregivers for patients.

“It was hard for them,” she said. “A lot of them lost their therapists.”

Veronica Pate, of Suitland, Md., said she and her 9-year-old daughter, who suffers from mental health issues, received services at the clinic until December.

“It was a big problem because my daughter was without medication for three months,” she said. “They were real disorganized — they didn’t care about their clients.”

Johnson said Family Matters plans to restart services in Maryland later this year. He said the nonprofit will use the money raised from the sale of its Virginia property to focus on government contracts for mental health services.

Sarbanes-Oxley and Compensation #NonprofitBoards

Goodwill generally meets a lot of folks' expectations.  But the Goodwill in Omaha described in the story below pretty much fails to meet the standards set by Goodwill or most other nonprofits for that matter.  Failings including an out-of-control CEO salary and out-of-control retirement/firing pay.  This Goodwill Board is not only bad in terms of compliance with many rules including Sarbanes-Oxley (and should be held accountable accordingly) but it should just be replaced.

 

After ousting CEO, Goodwill Omaha paid him another $610,000 in court settlement

• By Henry J. Cordes / World-Herald staff writer
 
• Mar 3, 2020 Updated Mar 3, 2020
 

Goodwill donations and sales have rebounded three years after a World-Herald investigation uncovered corporate-style executive pay in the nonprofit.

• CHRIS MACHIAN/THE WORLD-HERALD

 

 

 

Goodwill Omaha three years ago fired its former CEO amid scandal over his corporate-style pay, including a healthy six-figure salary, $100,000 annual performance bonuses, a $519,000 lump-sum retirement payout and a country club membership.

But even after Frank McGree was shown the door, he still ended up being paid an additional $610,000.

That’s because the generous compensation agreements the charity’s board had signed with him also gave him two years of base pay as severance — payable, McGree claimed, even if he was fired.

 

 

That final payment to McGree was revealed in the charity’s latest public disclosure statement, covering the charity’s finances for 2018.

McGree filed suit in 2017 over Goodwill’s refusal to pay him the severance. In 2018, the charity’s board acknowledged that it settled the lawsuit, part of an effort to move on from the McGree controversy. But until now, the size of the settlement wasn’t publicly known.

In the end, it appears Goodwill’s board decided to throw in the towel on the litigation. The payment was actually more than the $550,000 that McGree had sought in his lawsuit, suggesting that the two parties had other disagreements besides the severance.

Nearly the entire board of Goodwill has turned over since a World-Herald investigation in October 2016 that revealed Goodwill’s compensation practices.

 

Goodwill Omaha executive pay: An investigative series

 

 

The current board chairman, James Rich, who joined the board in 2017, said he could not speak in detail about the payment because of a confidentiality agreement that was part of the court settlement. The settlement agreement, however, acknowledged that the amount paid to McGree would eventually be disclosed in its nonprofit federal tax return, which is a public document.

Rich said the charity’s new board is happy to move on and has been sharply focused on the community jobs programs that are central to Goodwill’s mission. Rich also said the current board would not agree to put such a provision in an employment contract and has no such agreements now.

“It’s behind us,” he said.

The severance payment was just another example of how Goodwill’s compensation for McGree and other executives went well beyond the norm for such nonprofits.

The World-Herald investigation three years ago revealed that Goodwill spent so much on executive pay that scant profit dollars from its thrift stores were left to support its job programs.

McGree received base pay, retirement pay, performance bonuses and other compensation exceeding $400,000 annually — more than double the average for CEOs at other Omaha social service nonprofits. A $519,000 lump-sum retirement payment in 2014 brought his pay that year close to $1 million.

In all, 14 executives and managers at the charity were paid $100,000 or more, including McGree’s daughter. Nationwide, no Goodwill affiliate of its size had more employees paid in six figures.

Days after the newspaper’s series, McGree was ousted, and all the other top executives and most of the board ultimately turned over.

Girl Scout Leaders Lead #NonprofitBoards

So the article by The Lily doesn't specifically reference the Girl Scout boards (national and local) but I am confident that what is going on "right" with the Girl Scouts should be credited in part to the leadership.  According to the article, the Scouts have managed, for the most part, to stay in touch with the needs of young girls and what is called for in the environment around them.  The article did point out that the Scouts have yet to reach every demographic but it doesn't mean they aren't trying.  And yes, cookies were the starting point but just that, the starting point.