Philanthropy Today - Philanthropy.com

These are items on other Web sites that are of interest to the nonprofit world. The Chronicle has no control over their content or availability. To reach the Philanthropy Today staff, send an e-mail message to daily.news@philanthropy.com

Compiled by Noelle Barton, Caroline Bermudez, Maria Di Mento, Audrey Hill, and Anne W. Howard.

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January 2008

January 31, 2008

Clinton Foundation Faces Questions About Potential Donor Conflicts

After traveling with former president Bill Clinton to meet the Kazakhstani president, a Canadian mining magnate secured a lucrative uranium deal there and later donated a total of $131.3-million to Mr. Clinton’s charity, reports The New York Times.

A fledgling company put together by Frank Giustra, a personal friend of Mr. Clinton’s, gained the rights to mine uranium deposits in Kazakhstan two days after he and Mr. Clinton met with the country’s president in late 2005. Last year, another firm agreed to pay $3.1-billion to acquire Mr. Giustra’s company. He would be paid $7.05 per share for a company that two years earlier had traded at 10 cents per share, reports the Times.

In 2006, months after the deal, Mr. Giustra gave $31.3-million to the William J. Clinton Foundation; he more recently pledged $100-million to the organization.

The events raise questions about whether Mr. Clinton influenced the president of Kazakhstan to favor Mr. Giustra in the uranium deal.

Mr. Giustra tells the newspaper that his friendship with Mr. Clinton “has not directly affected any of my business transactions.” A spokesperson for Mr. Clinton says that the former president did not facilitate the deal.

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Online Fund-Raising Contest Favors Small Charities

As America’s Giving Challenge — the online grant contest paid for by the Case Foundation and conducted through Parade magazine and the social-networking site Facebook — draws to a close at end this week, grass-roots charities are among the leading candidates, reports The New York Times.

The contest will give a grand prize of $50,000 to the U.S.-based or international charity that attracts the most donors. Small nonprofit groups, such as a Georgia charity started a year ago that rescues abandoned dogs, have dominated the leader board, while some better-known groups have struggled, says the Times.

“We’re feeling good about what we’re seeing, though we can’t draw any conclusions at this point,” said Rich D’Amato, a spokesman for the Case Foundation. “Our goal was to inform and educate as many people as we could about online-giving tools.”

For more on the contest, read The Chronicle of Philanthropy’s coverage.

(Free registration is required to view the Times article, and a paid subscription or temporary pass is required to view the Chronicle story.)

WNET's Chief Takes on Expanded Role

Neal Shapiro, who has been president of the New York public-television station WNET for one year, takes over as president and chief executive of WNET’s parent group, the Educational Broadcasting Corporation, on February 4, reports The New York Times.

During his tenure at WNET, Mr. Shapiro has successfully pressed for locally focused programming through his use of unorthodox fund-raising strategies, says The Times.

While public television is notoriously slow to develop programs and raise funds, Mr. Shapiro says that he intends “to spark a national dialogue” about community-financed programming. “One of the things that I think I can bring here is to try to make us a little more nimble,” he said. As an example, Mr. Shapiro successfully raised $455,608 from individual viewers and larger sponsors for a program to examine New Yorkers’ war memories as an accompaniment to the filmmaker Ken Burns’s multipart documentary of World War II.

Mr. Shapiro says he hopes to build a network of donors who will give broadly instead of on a project-by-project basis in order to promote quick-turnaround programming.

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Air and Space Museum Wins Surprise $15-Million Gift

D. Travis Engen, former president of Alcan, an aluminum and packaging company, and his wife have donated $15-million to the Smithsonian Institution’s National Air and Space Museum, reports The Washington Post.

The donation, made in honor of Mr. Engen’s parents, will help build a new hangar for the museum’s Steven F. Udvar-Hazy Center where visitors can watch the restoration of historic airplanes.

The donor’s father, Donald D. Engen, formerly led the Federal Aviation Administration and the Air and Space Museum. He died in 1999 in a glider crash at the age of 75. His wife, Mary Baker Engen, died in 2006.

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Editorial: Congress Should Use Care Before Changing Endowment Rules

An editorial column in The Boston Globe cautions Congressional leaders to examine how higher-education endowments are currently used before pushing universities to spend 5 percent.

The article notes that in 2007, colleges and universities already spent an average of 4.6 percent of their endowments, and endowments give institutions freedom to pursue research and other projects without waiting for government money.

While sharp increases in tuition are troubling, “Congress also needs to recognize that professors, libraries, and labs are inherently expensive and that universities produce significant public benefits, in the form of research grants, economic development, and the new blood they bring into their host communities. If lawmakers want to tighten the rules for endowments, they first need to offer better evidence that schools are abusing their tax-free status and acting against the public interest.”

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Opinion: Corporate Goals Could Shift to Solve Social Problems

“Every few decades, America’s business leaders change their minds about what obligations corporations and the wealthy have to society,” writes David Callahan, an author and a senior fellow at Demos, in an opinion article in the Los Angeles Times. “Now, corporate leaders are shifting their thinking once more, calling for a gentler form of capitalism.”

Mr. Callahan cites comments from Bill Gates, founder of Microsoft, and H. Lee Scott Jr., chief executive of Wal-Mart, at the recent World Economic Forum as evidence that capitalists are becoming more socially conscious.

Mr. Gates called for a new “creative capitalism” that would help solve the world’s ills while also turning a profit, and Mr. Scott said his company will promote energy-efficient products and will improve labor conditions for its workforce.

“A sea change like this among the far-upper class doesn’t happen often,” Mr. Callahan writes. “If the consensus in the executive suites is that economic inequality has risen too much, or that too many social needs like health care are going unmet, or that the polar ice caps might really melt, the next president and Congress will have more success tackling these problems. It is far easier to get things done in Washington when Wall Street isn’t digging in its heels.”

For more on Mr. Gates’s comments at the meeting, read The Chronicle of Philanthropy’s coverage.

(Free registration is required to view the Los Angeles Times article.)

Give and Take, a Roundup of Nonprofit Blogs

Give and Take is a service of The Chronicle of Philanthropy that rounds up the best postings that appear on blogs about the nonprofit world.

Among the most-recent postings:

Does low pay in the nonprofit realm reflect self-sacrifice — or selfishness?

How the forces of supply and demand play out in the charity world.

You can also read previous postings on issues about philanthropic giving, fund raising, and management of nonprofit organizations.

Give and Take is updated regularly throughout the day.

Online Discussion: Building a Network of Support

Mark your calendars for our online discussion next Tuesday on how your charity can effectively use social-networking tools to reach potential donors, volunteers, and supporters.

Matt Flannery, co-founder of Kiva — a group that connects donors and entrepreneurs in developing countries — will be available to answer your questions.

The discussion will be held on February 5 at noon, Eastern time, and is open to everyone, not just Chronicle subscribers.

People who ask questions in advance have a better chance of receiving answers during the online discussion.

From The Chronicle: California Diversity Bill

The California Assembly this week approved legislation to require big foundations to disclose information about the diversity of their boards, employees, and grant making, The Chronicle of Philanthropy reports. Many grant makers oppose the rule.

January 30, 2008

Foundations Pour Money Into Washington Think Tanks

Research institutions in Washington are growing not only in size and scope, but also perhaps in policy influence, reports The New York Times.

As think tanks such as the Center for Strategic and International Studies, the Council on Foreign Relations, the United States Institute of Peace, and the Brookings Institution buy more land in Washington to accommodate their growing staffs and pumped-up operating budgets, their research conferences, policy papers, and a tight presidential race are lending the organizations a new status.

“While President Bush was bad for the world, he was good for our business,” said John Podesta, the chief executive of the Center for American Progress, a four-year-old group with an annual operating budget of about $23-million. The group receives strong support from the Open Society Institute, founded by the financier George Soros.

Philanthropy’s increasing interest in policy work by philanthropists is fueling the budgets of other Washington think tanks as well. The Center for Global Development has received huge donations from foundations, such as a $24- million grant from the Bill & Melinda Gates Foundation. The Gates foundation has also given millions of dollars to Brookings, the Center for Strategic and International Studies, and the Council on Foreign Relations.

Some experts who study think tanks worry that donors will exercise influence over the results of the groups’ studies. “The [research] agenda is really being distorted by interlopers — they’re the donors,” said James McGann, a professor of political science at Villanova University. “Most people don’t want to talk about it because they don’t want to bite the hand that feeds them.”

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Afghan Women Urge New Efforts to Rescue Kidnapped Aid Worker

After the abduction of a female aid worker in Kandahar, Afghanistan, last week, roughly 500 Afghan women gathered in the city on Tuesday to press officials to step up their investigation of the kidnapping, The New York Times reports.

Afghan women’s associations, the newspaper said, also urged citizens at the gathering to work for the release of the aid worker, Cydney Mizell, and her driver, Abdul Hadi, who was also abducted. Afghan officials said that they have no leads on the kidnappers thus far.

Ms. Mizell had been working in Kandahar for six years on educational projects and women’s development as part of the Asian Rural Life Development Foundation.

Soraya Barna, a member of the provincial council of Kandahar, expressed the dismay of the many women who had been touched by the work of Ms. Mizell, saying, “We are so sad and we want her to be released as soon as possible. We want officials and others to multiply their struggle to find her soon and hope she will be back safely.”

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New Effort to Groom Arts Leaders Gets Under Way

A new fellowship program seeks to train museum curators in business skills so that people with art training — not business leaders — can take a stronger role in managing cultural institutions, reports The New York Times.

The Center for Curatorial Leadership, a two-week program created by Elizabeth W. Easton, former chairwoman of the European paintings and sculpture department at the Brooklyn Museum, focuses on the issues typically dealt with by museum directors such as attendance, donations, construction, endowments, the news media, governmental support, and budgets.

The center, The Times reports, is supported by Agnes Gund, president emerita of the Museum of Modern Art, who contributed more than $500,000 a year to the program.

Ms. Gund, who serves on the boards of several prominent museums, said she often sees curators get overlooked by selection committees for executive posts because of their lack of business experience. She hopes the program will help combat this trend and “keep the people who are in charge focused on the most important thing about museums, which is the art part.”

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Opinion: Doctor Pleads for Better Food Aid

Children in developing nations suffer from malnutrition that would be more easily prevented if the food aid given them by the United States and other nations were more targeted to their needs, writes Susan Shepherd, a pediatrician and medical adviser for Doctors Without Borders, in a The New York Times opinion article.

Malnutrition contributes to the deaths of five million children under the age of 5 every year, largely in countries that do not produce or have the resources to buy milk, Dr. Shepherd writes.

The key to helping such children, she continues, is a nutrient-rich paste that can be made locally, known as “ready-to-use food;” it’s composed of powdered milk, ground peanuts, oil, sugar, vitamins, and minerals and can be prepared without water, which, she says, “solves the problems of preparation, storage, and contamination.”

The United States and international bodies must press for the distribution of the paste beyond the most severely malnourished children, Dr. Shepherd says. “Children shouldn’t have to deteriorate to the point of severe malnutrition to ‘qualify’ for ready-to-use food.” She concludes, “The United States is the largest single donor of food aid in the world, but it doesn’t provide enough of what young children really need.”

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Obituary: Patricia A. Corbett, Arts Philanthropist, Dies at 99

The death of Patricia A. Corbett, a prominent philanthropist in Cincinnati,
will leave a void in that city’s arts scene, reports The Cincinnati Enquirer. Mrs. Corbett died January 28 at her home in Hyde Park, Ohio. She was 99.

Mrs. Corbett and her husband, Ralph, also deceased, gave millions of dollars to the arts through the Corbett Foundation, established in 1995, and through her own personal gifts.

The couple made their fortune via their door-chime company, NuTone.

Many of their gifts were made to help area arts-education organizations thrive. In 2000, for example, Mrs. Corbett made a personal gift of more than $2-million to Northern Kentucky University.

In 1997, Mrs. Corbett and the Corbett Foundation also gave the Cincinnati Symphony Orchestra a $5-million grant to provide classroom and concert experiences for area students.

“We know how much good it does to get children to listen to classical music,” Mrs. Corbett told The Enquirer years before her death. “You try to touch them in some way, and music transports us into another world.”

From The Chronicle: Helping the Next Generation

The baby boomers who founded so many nonprofit organizations need to take steps to embrace the new ideas and approaches suggested by younger people, writes Robert Egger, in an opinion article in The Chronicle of Philanthropy.

(A paid subscription or short-term pass is required to view this article.)

January 29, 2008

Climate Change Prompts Tough Questions for Conservation Charities

Conservation organizations that preserve biologically important areas are rethinking their strategy, as climate change alters the physical landscape, reports The New York Times.

Environmental groups now must grapple with questions such as should they try to prevent the shift of ecosystems focus on preserving areas least likely to change? Should they nmve species from one locale to a more suitable one, as climate changes?

In addition to considering the impact of climate change on current conservation projects, conservationists are wondering how already preserved lands will be impacted as temperature and sea level rise.

“It’s turning conservation on its head,” notes Bill Stanley, director of the global climate change initiative at the Nature Conservancy.

Hospital's Real-Estate Deal Prompts Concern

The North Shore-Long Island Jewish Health System, in New York, is facing questions about potential conflicts of interest on its board after it made a $300-million lease deal through its vice chairman’s real-estate partnership, reports Newsday.

William Mack, both a leading donor and a longtime member of the health system’s executive committee, is a general partner of a private-equity real estate fund that owns a former defense plant that sits across the street from the Long Island Jewish Medical Center, in New Hyde Park, N.Y.

The factory property was purchased for $20.5-million in 2000 in a deal led by Mr. Mack’s son, Richard, and a third of the property is now being leased to the health system for $300-million in base rent over 25 years.

The dual role of the Macks, who said they have spent “several hundred million dollars” renovating the property, has prompted concerns by current and former health-system officials about the effects of the deal on the group’s governance.

William Mack defended the arrangement.

“My family has worked for this institution for 50 years,” Mr. Mack said. “The level of the service and the level of the philanthropy pales by thousands any possible financial advantage we could gain.”

A Homeless Shelter Goes Green

A newly completed shelter in Oakland, Calif., may be the first shelter built green, or environmentally friendly, from the ground up, reports The New York Times.

The $11-million facility, Crossroads, features many design elements intended to reduce the building’s harm to the environment, including a solar-powered roof, hydronic heating, ceiling fans, nontoxic paint, and windows that open.

The first residents of the 125-person shelter will move in next week; an estimated 6,000 homeless people reside in Alameda County over all. Wendy Jackson, executive director of the East Oakland Community Project, spent 10 years developing the facility, including seven years securing grant money from government and private agencies.

Now, with the first homeless individuals set to move into the green shelter, Michael Stoops, acting executive director of the National Coalition for the Homeless in Washington, hopes the facility will become “a model for others around the country.”

Read a Chronicle article about other efforts by nonprofit groups to promote environmentally friendly housing for needy people.

(Free registration is required to view the Times article, and a paid subscription or short-term pass is required to view the Chronicle article.)

Smithsonian Committee Urges Changes in Business Unit

A committee reviewing the Smithsonian Institution’s troubled business unit has called for an overhaul in how the unit operates, reports The Washington Post.

The committee said that “the strained relationship between the Smithsonian’s content experts and its business professionals was in large part responsible for the actual and perceived failures” of the business unit.

The committee recommended steps to ensure greater accountability and openness for the unit, and a new system for distributing profits from business ventures to Smithsonian museums.

The Smithsonian Institution’s business enterprises last year earned $26.6 million, the newspaper noted.

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Opinion: President Bush Falls Short on His Plan to Help Religious Charities

Even as President Bush called on Congress last night to permanently extend his efforts to help religious groups get government grants, the real job of advancing the role of religious groups will fall to the next president, say two former White House officials in a New York Times opinion article.

That is because Mr. Bush failed to deliver on his promise, says the article, by David Kuo, deputy director of the White House Office of Faith-Based and Community Initiatives in 2002-3, and John J. DiIulio Jr., who directed the office in 2001.

“Every nonpartisan study has concluded that the initiative has not delivered the grants, vouchers, tax incentives, and other support for faith-based organizations that the president originally promised,” they write.

With many state governments turning to faith-based charities to provide social services and opinion showing that most Americans support federal-grant eligibility for religious organizations, the authors conclude that “[i]t will be left to the next president to deliver on those promises” made by President Bush.

Read an opinion article from The Chronicle outlining how the next president should aid religious charities.

(Free registration is required to view the Times article, and a paid subscription or short-term pass is required to view the Chronicle article.)

Online Discussion: Building a Network of Support

Mark your calendars for our discussion next Tuesday on how your charity can effectively use social-networking tools to reach potential donors, volunteers, and supporters.

Matt Flannery, co-founder of Kiva — a group that connects donors and entrepreneurs in developing countries — will be available to answer your questions on this topic during a live online discussion Tuesday, February 5, at noon, Eastern time.

Plus, you can read a transcript of today’s discussion on making the transition from business or government to a nonprofit career.

Correction: Private School Endowments

An item on Monday about the endowments of private schools should have noted that the endowment at Phillips Exeter Academy surpassed $1-billion last year.

From The Chronicle: State of the Union

President Bush, in his State of the Union address last tonight, asked Congress to pass legislation that would “permanently extend” steps that his administration has taken to allow religious charities to compete more easily for federal funds, The Chronicle of Philanthropy reports.

January 28, 2008

Bush's State of the Union Call for Volunteerism Fell Short, Experts Say

After President Bush vowed in his State of the Union address in 2002 to create a culture of volunteerism in the United States, many people say the White House squandered the opportunity that was available in the wake of the 2001 terrorism attacks, reports The New York Times.

The White House says that since 2000, it has recruited more than one million Americans for the Citizen Corps, a national network of doctors, firefighters, and others who volunteer during emergencies, greatly exceeding the 200,000 new recruits Mr. Bush promised.

However, the Peace Corps, which had 6,663 volunteers in 2002, today has 8,049, falling significantly short of the doubling the president promised. And though he successfully increased the ranks of AmeriCorps to 75,000 from 50,000 as promised, critics note that fewer than half the 75,000 slots are full time.

To read more about how the effort to promote volunteerism, read a Chronicle analysis.

(Free registration is required to view the Times article, and a paid subscription or short-term pass is required to view the Chronicle article.)

Elite Private Schools Boast College-Size Endowments

The average endowment per student, adjusted for inflation, has increased by 93.5 percent at the nation’s private schools in the past 10 years, even though enrollments have grown by only 11.6 percent, reports The New York Times.

As a growing number of endowments at the nation’s largest schools have ballooned, trustees have begun to hire full-time money managers. The older, better-known schools generally have the largest endowments. The endowment at Phillips Exeter, the nation’s third-oldest school, exceeded $1-billion last year, fueled by donations from wealthy alumni and its own lucrative investments, up from just over $500-million in 2002.

Fund raisers at both day and boarding schools agree that graduates feel more loyalty toward their secondary schools than to their colleges and are therefore generous donors. “I always tell people I was educated at Exeter and went to Yale,” said James H. Ottaway Jr., a former board member of Dow Jones & Company, whose most recent gift to the school was $10-million for its scholarship fund.

To see more about the endowments of private schools and other nonprofit organizations, view the results of The Chronicle’s annual endowment survey.

(Free registration is required to view the Times article, and a paid subscription or short-term pass is required to view the Chronicle article.)

U.S. Aid Worker Abducted in Afghanistan

Police in Kandahar, Afghanistan, searched on Sunday for Cyd Mizell, 49, an abducted American aid worker, and her Afghan driver, who were kidnapped while traveling to work on Saturday, reports the Agence France-Presse.

The Afghan government and Ms. Mizell’s employer, a community-development organization from the Philippines called the Asian Rural Life Development Foundation, said the kidnappers had not made contact.

According to her organization’s Web site, Ms. Mizell, who taught English and embroidery, had been working on development projects in the Kandahar area for nearly three years, as well as on efforts to help women.

Read The Chronicle’s article on the growing difficulty groups face attracting skilled workers because of the dangers involved in international aid.

Popular Nonprofit Web Site Faces Overwhelming Demand

Kiva, a nonprofit organization that lets users of its Web site make small interest-free loans to entrepreneurs in poor countries is struggling to maintain an adequate supply of loan-seeking entrepreneurs to keep up with the demand from potential donors, reports The New York Times.

Fiona Ramsey, public-relations director at Kiva, which has attracted more than $19.5-million worth of loans from more than 22,000 individuals, said would-be lenders are surprised to be greeted with messages that encourage them to check back soon for giving opportunities.

“We don’t want people coming to the Web site who want to make a loan and there’s no one to loan to,” she said.

Frustrated visitors have sometimes contacted the site demanding an explanation for the lack of needy people to help. The group, which has a 23-person staff, works with microfinance institutions in 39 countries to line up potential borrowers. “We could keep, for lack of a better word, a stockpile of entrepreneurs,” Ms. Ramsey said. “But these are real people. We’re not looking at them as inventory.”

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Cyclist's Foundation Strikes a Partnership for Profit

The charitable foundation created by Lance Armstrong, the cyclist and cancer survivor, has struck a partnership with Web-site operator Demand Media, a company in Santa Monica, Calif., to start Livestrong.com, a health and wellness Web site, reports The Wall Street Journal.

The new Web site, which will be supported by advertising, is expected to go live this year.

As part of the deal, the Lance Armstrong Foundation, in Austin, Texas, which spends about $40-million annually on health programs and cancer research, and Mr. Armstrong will take equity stakes in Demand Media, which was valued at nearly $1-billion by investors last year.

Demand is run by Richard Rosenblatt, the former chairman of MySpace. Though neither Demand Media nor the foundation would confirm the size of the equity stakes, Mr. Rosenblatt said they are “significant.”

Former Charity Executive Admits Stealing

The former chief executive of the actor Chuck Norris’s martial-arts program for inner-city children, James D. Brasher pleaded guilty last week to stealing from the charity, the U.S. Attorney’s office in Houston has announced, reports the Associated Press.

Mr. Brasher admitted to taking at least $130,000, the office said in a statement. He also acknowledged that he opened bank accounts in names similar to that of the Kick Drugs Out of America Foundation, which serves young people in Houston and Dallas, and fraudulently endorsed checks sent to the foundation and deposited the money into his own accounts.

Mr. Brasher is scheduled to be sentenced in April. He faces up to 10 years in prison, a fine of $250,000, and a three-year-term of supervised release.

Give and Take, a Roundup of Nonprofit Blogs

Give and Take is a service of The Chronicle of Philanthropy that rounds up the best postings that appear on blogs about the nonprofit world.

Among the most-recent postings:

Are too many people starting charities?

What does it take for a nonprofit group to become a great place to work?

You can also read previous postings on issues about philanthropic giving, fund raising, and management of nonprofit organizations.

Give and Take is updated regularly throughout the day.

Online Discussion Tomorrow: Nonprofit Careers

Join The Chronicle online tomorrow, January 29, at noon Eastern time for a discussion about how to make the move into the nonprofit world from business or government.

The guests will be:

Paul Rosenberg, a partner at the Bridgespan Group, in Boston, a nonprofit organization that provides strategic-planning advice to charities. Mr. Rosenberg was previously an executive for companies like Bain & Company, Grand Circle Travel, and the Kensington Investment Company.

James Weinberg, chief executive of Commongood Careers, in Boston. Commongood helps social entrepreneurs recruit and hire workers and helps workers learn more about careers at nonprofit organizations.

Kathleen Yazbak, managing director of national relationships at Bridgestar, an executive-search firm for charities.

The discussion is open to everyone, not just Chronicle subscribers. People who ask questions in advance have a better chance of receiving answers during the online discussion.

More information is available here.

From The Chronicle: Is America Generous?

Is the United States as generous as government officials, nonprofit leaders, and journalists say? Pablo Eisenberg, a Chronicle of Philanthropy columnist, says the answer is no.

(A paid subscription or short-term pass is required to view this article.)

January 25, 2008

From the Chronicle: Aiding Small Farmers in Africa and Asia

The Bill & Melinda Gates Foundation today announced six grants totaling $306-million for programs designed to increase agricultural productivity and income for small-scale farmers in Africa and Asia, The Chronicle of Philanthropy reports.

Raid on Calif. Museums Could Lead to Indictments of Employees in Looting Scheme

An investigation by an undercover federal agent who posed as a buyer of looted art came to a climax with coordinated raids on four Southern California museums early Thursday, reports the Los Angeles Times.

The raids suggested that several Los Angeles art institutions may be involved in the extensive purchase of objects believed to have been taken illegally from China, Myanmar, and Thailand, as well as from Native American sites within the United States, according to search warrants served Thursday.

Authorities were most concerned with artifacts allegedly taken from Thailand’s Ban Chiang archaeological site, and suggested that they were smuggled into the United States and donated at inflated prices, thereby allowing collectors to claim fraudulent charitable deductions on their tax returns.

The newspaper said it is possible museum staff members may be indicted for complicity in the looting schemes under American law.

The museums that were investigated in the raid were the Los Angeles County Museum of Art; the Pacific Asia Museum, in Pasadena; the Bowers Museum, in Santa Ana; and the Mingei International Museum, in San Diego.

Museum officials denied wrongdoing and pledged to cooperate fully in the investigations.

Senators Solicit Information From Wealthy Colleges and Universities

Two key U.S. senators sent a letter to 136 colleges and universities on Thursday requesting detailed information on endowment spending, tuition costs, and financial-aid policies over the last decade, reports The Chronicle of Higher Education.

Sen. Max S. Baucus, Democrat of Montana, and Sen. Charles E. Grassley, Republican of Iowa, announced plans to send the letters just a few hours after the release of an annual report showing that college endowments earned an average return of 17.2 percent in 2007. Colleges with endowments of at least $500-million as of June 30, 2007, are to receive the 50 questions.

The senators say that since university endowments receive large tax benefits, these institutions must prove how they are working to keep the cost of tuition down for students, particularly those from low- and middle-income families.

“Tuition has gone up, college presidents’ salaries have gone up, and endowments continue to go up and up,” Mr. Grassley said in a written statement. “We need to start seeing tuition relief for families go up just as fast.”

Colleges have expressed a mixed reaction to the letter, but many are concerned that 30 days is insufficient time to respond. Robert J. Birgeneau, chancellor of the University of California, told The New York Times that “I believe that Senator Baucus’s and Grassley’s intentions may be admirable, but understanding university finances is an extremely complex matter, especially in public colleges and universities.”

(Free registration is required to view the Times article.)

Donors and College Officials Gain Access to University Investments

The high investment yield of many college and university endowments is attracting the interest of a handful of donors who have begun to invest their trusts alongside college endowments, reports The Chronicle of Higher Education.

The practice has also expanded beyond donors, as some college officials have deferred compensation by investing though their institution’s endowment. Some colleges are considering whether to extend the option to faculty members in hopes of recruiting top-notch scholars.

Beyond the benefits of gaining access to the top investment expertise of many endowment managers, donors and college officials gain access to hedge funds and private equity that individual investors normally cannot touch. Donors who invest with universities set up charitable remainder trusts, guaranteeing that the institution will receive money left in a trust when a donor dies.

Harvard University was the first institution to win permission from the Internal Revenue Service to offer donors the ability to put their money into endowment investments. (To read more about how the effort got started, see this Chronicle of Philanthropy article.)

University in St. Paul Receives $50-Million Gift

The University of St. Thomas’s Opus College of Business announced a $50-million gift on Thursday from an anonymous donor, reports The Chronicle of Higher Education.

The money will endow scholarships and academic programs.

The St. Paul university has so far raised $317-million as part of an eight-year $500-million fund-raising campaign.

The Star Tribune, in Minneapolis, reports that the gift is one of a string of major donations the university has received in the past decade.

In 2000, Richard Schulze, founder of Best Buy, and his wife, Sandra, gave St. Thomas a gift of $50-million, while Lee Anderson, owner and chairman of the St. Paul-based APi Group Inc., and his wife, Penny, gave the university $60-million in 2007. That donation put the Andersons on The Chronicle of Philanthropy’s list of the most-generous donors of 2007.

Government and Politics Watch

Among the highlights from The Chronicle’s Government and Politics Watch is a plea made by a nonprofit leader to include two charity measures in the Senate’s economic-stimulus bill.

Give and Take, a Roundup of Nonprofit Blogs

Give and Take is a service of The Chronicle of Philanthropy that rounds up the best postings that appear on blogs about the nonprofit world.

Among the most-recent postings:

Will Bill Gates’s “creative capitalism” speech make a difference?

Will charities benefit as tycoons in China and Hong Kong gain additional wealth?

You can also read previous postings on issues about philanthropic giving, fund raising, and management of nonprofit organizations.

Give and Take is updated regularly throughout the day.

Online Discussion Next Week: Nonprofit Careers

Mark your calendar to join next week’s discussion with some of the nation’s top career experts talking about how to make the jump from a life in the for-profit world to the charitable sector.

Among the questions to be considered: What should those who are looking to transition to a career in the nonprofit sector do to prepare themselves for their new roles? What skills do they need to hone? What cultural changes can they expect?

The discussion will be held on Tuesday, January 29, at noon, Eastern time, and is open to everyone, not just Chronicle subscribers.

People who ask questions in advance have a better chance of receiving answers during the online discussion.

January 24, 2008

Healthy University Endowments Cushion Blow of Recession and Increase Demand for Financial Aid

Colleges and universities earned an average of 17.2 percent on their endowments in the 2007 fiscal year, the highest rate of return in almost a decade, and one that institutions hope will stave off losses as the dark cloud of a recession looms, reports The Chronicle of Higher Education.

The news comes from an annual report released today by the National Association of College and University Business Officers, in conjunction with TIAA-CREF Asset Management, which examined endowments at 785 colleges and universities.

Despite healthy returns, some colleges and universities have reported a drop in earnings since June because of losses from failing investment holdings, such as subprime mortgages and volatile global markets. Yet some universities are attempting to entice donors and employees to invest alongside the institutions’ endowments, allowing such investors to share the same high returns as universities, reports the newspaper.

Such arrangements give individuals access to risky or alternative investment approaches, like hedge funds and private equity, that can yield high returns and are usually off limits to individual investors. But getting approval from the IRS for such an arrangement can be a lengthy process, the paper reports.

As it has done almost every year, Harvard’s endowment saw significant gains, rising by nearly $6-billion over the past year, a nearly 20 percent increase. Yale University’s endowment, the nation’s second largest, rose to $22.5-billion, a 25 percent increase, and Stanford University, Princeton University, and the University of Texas System rounded out the top five, reports The Boston Globe.

As the value of university endowments grew by $71-billion, or 21 percent, to $411.2-billion, compared with the previous fiscal year, 14 additional institutions joined the list of those with assets of at least $1-billion, reports The Wall Street Journal. They included Syracuse, Lehigh, and Carnegie Mellon universities.

See The Chronicle of Higher Education’s database of endowments at colleges and The Chronicle of Philanthropy’s annual survey of endowments.

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American Heart Association Defends Drug Recommendation

The American Heart Association is defending its decision to recommend Vytorin, an expensive combination of drugs for treating high cholesterol, after a study showed the drug was no more effective than a cheaper alternative, reports The New York Times. The charity drew criticism for the move because it did not reveal that it receives almost $2-million a year from Merck/Schering-Plough Pharmaceuticals, the companies that jointly market Vytorin.

The heart association issued a statement on January 15, the day after the report’s release, saying the study was limited and should not lead people to draw conclusions about Vytorin’s ability to reduce heart attacks or deaths compared to the less-expensive alternative, Zocor, alone. The group advised patients not to stop taking Vytorin without consulting their doctors.

Daniel W. Jones, president of the American Heart Association, who was quoted in the statement, said yesterday that his group did not typically mention its drug-company sponsors when issuing news releases with advice to patients.

The House Energy and Commerce Committee plans today to send letters to the association and Merck/Schering-Plough asking about their relationship, and a letter to the American College of Cardiology, which also receives drug-industry money and also released a statement last week advising patients not to stop taking Vytorin without consulting their doctors.

Both organizations said that the money they receive from the drug companies had nothing to do with their statements. Merck/Schering-Plough also said it had played no role in the statements by the two groups.

But Sidney M. Wolfe, the head of the Public Citizen’s Health Research Group, a consumer-advocacy group, pointed out that the drug industry underwrites many professional medical organizations and said such funds raise questions about the groups’ objectivity.

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Charity Leader Accused of Sexual Harassment

John Burton, a former California State Senate leader who founded a charity to help homeless children, is being sued for $10-million by the charity’s executive director, who claims he sexually harassed her, The San Francisco Chronicle reports.

Susan Rubenstein, Mr. Burton’s attorney, said the allegations were false and called the lawsuit, filed in San Francisco Superior Court, a “shakedown.”

Mr. Burton, who rose to become California’s second-most-powerful politician, had a reputation for using vulgar language throughout his 35-year political career, according to the paper. One of his supporters once described Mr. Burton as “visceral, irascible, occasionally avuncular, and routinely profane.”

But Kathleen Driscoll, the executive director of the John Burton Foundation for Children Without Homes, who is suing Mr. Burton, said in her lawsuit that Mr. Burton’s offenses went beyond colorful language.

Ms. Driscoll said Mr. Burton repeatedly remarked on her choice of underwear and the appearance of her breasts, often mimicked masturbation in her presence and told her on more than a dozen occasions, “I had a dream about you last night,” while making suggestive faces.

Boston Museum Sues to Keep Painting

The Museum of Fine Arts, in Boston, filed a lawsuit in federal court this week to retain ownership of a 1913 oil painting that Claudia Seger-Thomschitz, an Austrian woman, claims belongs to her, reports The Boston Globe.

Lawyers for Ms. Seger-Thomschitz say the painting, “Two Nudes (Lovers),” by Oskar Kokoschka, was sold in 1939 under duress by a physician who ran an art gallery in Vienna during the Nazi occupation of Austria. One of the physician’s sons designated Ms. Seger-Thomschitz as his “select niece and designated heiress,” according to John J. Byrne Jr., one of her lawyers.

Using findings from research conducted by a provenance specialist at the museum (one of several American museums seeking to establish ownership of disputed works through the court system), the institution on Tuesday presented an ownership history for the painting to Ms. Seger-Thomschitz’s lawyers that museum officials said proved the work was sold by choice, not under pressure by the Nazis.

Ori Soltes, co-founder of the Holocaust Art Restitution Project, in Washington, said he was impressed by the museum’s research. “It strikes me the MFA’s case has a lot of merit,” Mr. Soltes said.

But Ms. Seger-Thomschitz’s lawyers said they intend to respond to the museum’s lawsuit. “We disagree with them in the most important part of this, which is that there was immense persecution of this family that compelled them to sell this painting,” Mr. Byrne said.

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From The Chronicle: Public-Service Announcements

Broadcast and cable networks donate 17 seconds an hour, on average, to airing free public-service advertisements, according to a new study sponsored by the Henry J. Kaiser Family Foundation and reported on in The Chronicle of Philanthropy.

Government and Politics Watch

Among the highlights from The Chronicle’s Government and Politics Watch is a plan by the Internal Revenue Service to release the new informational tax return, known as Form 990 tax, on a staggered schedule.

Online Discussion Next Week: Nonprofit Careers

Mark your calendar to join next week’s discussion with some of the nation’s top career experts talking about how to make the jump from a life in the for-profit world to the charitable sector.

The discussion will be held on Tuesday, January 29, at noon, Eastern time, and is open to everyone, not just Chronicle subscribers.

People who ask questions in advance have a better chance of receiving answers during the online discussion.

From The Chronicle: A Call for 'Creative Capitalism'

Bill Gates today urged businesses, nonprofit groups, and governments to work together to promote what he calls “creative capitalism,” The Chronicle of Philanthropy reports.

In a speech at the World Economic Forum, in Davos, Switzerland, he said his goal is to harness market forces to provide more assistance to the poor than nonprofit groups and philanthropists can muster on their own.

January 23, 2008

Ohio Takes New Look at Nonprofit Hospitals

Ohio’s Attorney General, Marc Dann, is beginning an investigation into whether the state’s 174 nonprofit hospitals can justify their tax-exempt status, reports The Columbus Dispatch. While a previous effort failed due to criticism from hospital leaders and other nonprofit organizations, Mr. Dann believes that a more collaborative approach this time will help assure his success.

“Anytime you start to hold people accountable who have not had that for decades, if not centuries, people are going to start to be nervous,” Mr. Dann said. He took the first steps toward working with relevant nonprofit groups last week by discussing his ideas with the board of the Ohio Hospital Association, which represents the nonprofit hospitals.

A hospital-association spokeswoman, Tiffany Himmelreich, said that the group would “work hard with the attorney general’s staff to explain what community benefits the hospitals provide” but noted that the Internal Revenue Service was undertaking a similar effort to require more detailed financial accounting beginning in 2009. Ms. Himmelreich said the association hopes Mr. Dann’s efforts won’t duplicate the IRS’s work.

Among Mr. Dann’s goals are to investigate how much nonprofit hospitals pay their executives, how they collect unpaid medical bills, how much charity care they provide, and how much financial information they disclose to the public.

Supreme Court Ruling Affects Trusts

People who set up trusts, including charitable trusts, will no longer be able to deduct investment advisory fees in full for income-tax purposes, reports The Wall Street Journal. A Supreme Court ruling last week indicated that those fees will be deductible only to the extent that their total, along with certain other miscellaneous deductions, exceeds 2 percent of the trust’s adjusted gross income.

The case, generally known as the “Rudkin” or “Knight” case, has the most serious implication for big estates and trusts that typically spend a great deal on investment-advisory fees, according to the article.

Calif. Politician Accused of Using Charity for Politics

The Foundation for Taxpayer and Consumer Rights has accused Fabian Nuñez, speaker of the California Assembly, of using a charity as an illegal conduit for his political contributions, reports the Los Angeles Times. The complaint was filed with state ethics officials on Tuesday and cites more than $270,000 that Mr. Nuñez raised in 2005 and 2006 on behalf of a small charity, Collective Space, that may have been used for his political benefit.

Doug Heller, executive director of the Foundation for Taxpayer and Consumer Rights, said that “the contributions were never intended for the charity and should be considered direct donations to the speaker and his events.” The foundation accused Mr. Nuñez of purposefully evading state restrictions on campaign donations by asking donors to give to Collective Space and then using the money for self-promotional purposes. Mr. Heller said he hoped that the ethics panel would either punish Mr. Nuñez or close “a glaring loophole” in state campaign-finance rules.

Mr. Nuñez denies that he has done anything illegal or unethical and said the allegations were a “huge stretch from where reality is of what law allows a member of the legislature to do.” A 1997 state law indicates that politicians must report whenever donors give to noncampaign causes at their request and that such donations are not considered campaign donations if made “principally for charitable purposes.”

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N.H. Considers Crackdown on Charitable Gaming

New Hampshire lawmakers are considering a number of proposals that would place restrictions on charitable gaming, reports the Associated Press. This type of activity has recently surged across the state, and lawmakers now hope to either put a damper on gaming or regulate it more stringently.

Nonprofit groups that currently hold charity-gambling events like poker nights are required by law to get at least 35 percent of the profits, while the bulk of money goes to private game operators. One proposal would increase the amount of profits that such organizations donate to charity, while another would increase fees paid to the state.

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Texas Donor Starts Campaign to Raise Billions of Dollars

A Texas man is offering $1-billion awards to the first people who find cures for breast cancer and diabetes, produce a high miles-per-gallon car, and find a way to cause a huge reduction in greenhouse emissions, The Austin American-Statesman reports. The only hitch is that he still needs to raise the funds.

The donor, Mike Dewey, is not a millionaire, but his unique and ambitious effort is capturing the financial support of some powerful people and organizations.

The effort, called the Victory Project and run by the Dewey Foundation, has received $6-million in pledges so far. While Mr. Dewey acknowledged that the initial pledges were nowhere near his goal to raise $4-billion, “I know it to be true, this will absolutely work,” he said.

Mr. Dewey, an Austin marketing consultant, was motivated to start the project in response to his wife’s battle with breast cancer. Although Barbara Dewey is now cancer-free, Mr. Dewey explained, “I figure I’ve got about 20 years to make sure this thing works so my little girls don’t get breast cancer.”

The Dewey Foundation also plans to claim ownership rights to the cure/invention created by the winners. “I intend to give the dang thing away,” Mr. Dewey said. “There are people dying out there because they can’t afford the next pill off the AIDS drug-assembly line. Our idea gets the whole profit incentive out of the way upfront.”

N.Y. Junior League Hopes New President Will Repair Image

The New York Junior League has received a whirlwind of publicity this week, but not all the news is positive. The New York Times reports that the organization announced the appointment of its first black president — Gena Lovett, the chief operating officer of a Manhattan hedge-fund company — on Tuesday, but the organization continues to be haunted by comments made by Ms. Lovett’s predecessor, Trisha G. Duval, who has accused the board of mismanaging the group’s finances.

Ms. Duval alleges that the board tried to cover up a projected $1-million deficit from members. Though the board denies such mismanagement, Ms. Duval has threatened to take details of her allegations to the league’s membership at the group’s annual meeting on January 29.

The board has countered Ms. Duval’s allegations through a special committee of the league that may charge her with ethical violations that include an “unauthorized interview” to The New York Times last week about the league’s financial condition. Ms. Lovett is set to replace Ms. Duval on July 1, but if the special committee pursues the ethical charges, league officials say that Ms. Duval may be forced to leave before the end of her term.

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Give and Take, a Roundup of Nonprofit Blogs

Give and Take is a service of The Chronicle of Philanthropy that rounds up the best postings that appear on blogs about the nonprofit world.

Among the most-recent postings:

Thoughts about how a recession would affect charities.

Ideas for how philanthropy should be taught.

Ways a foundation can help individual givers.

You can also read previous postings on issues about philanthropic giving, fund raising, and management of nonprofit organizations.

Give and Take is updated regularly throughout the day.

From The Chronicle: Key Senate Aide Resigns

Dean A. Zerbe — the chief tax lawyer for Sen. Charles E. Grassley and a leading figure behind nonprofit-related legislation in recent years — plans to leave Congress at the end of February, The Chronicle of Philanthropy reports.

January 22, 2008

Georgia Tech Administrator Stole $350,000

An administrator at Georgia Tech stole as much as $350,000 from the university over a six-year period, according to documents released by the University System of Georgia and obtained by the Atlanta Journal-Constitution.

The chancellor of the university system recently ordered an investigation into the $350-million-per-year purchasing-card program, which allows university employees to pay for work-related items, after a state audit report said the program lacked basic oversight and was often abused.

The newspaper reports that the newly released documents discuss 18 cases of fraud involving the cards, including the unnamed administrator who “submitted fraudulent invoices to conceal personal purchases” to steal between $320,000 and $350,000. The employee worked in the Parker H. Petit Institute of Bioengineering and Bioscience, according to a university-system spokesman.

Twelve university employees who were accused of fraud in the newly released documents have resigned, been fired, or retired, the newspaper reports.

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Abortion-Rights Groups Plan to Endorse Political Candidates, Rally Voters

Several abortion-rights advocacy organizations have announced plans to spend tens of millions of dollars to persuade voters to elect political candidates who support legalized abortion, reports The Wall Street Journal.

Today — the 35th anniversary of the Roe v. Wade Supreme Court decision legalizing abortion — the Planned Parenthood Federation of America will announce a $10-million campaign to persuade a million people to vote for candidates who support abortion rights.

The effort is being run by Planned Parenthood Action Fund, an affiliated lobbying organization that is allowed to endorse specific candidates. Under federal law, Planned Parenthood’s charity status prevents it from taking such action on its own.

Additionally, Emily’s List, an organization that backs female Democrats who support abortion rights, seeks to raise more than $46-million to encourage women to vote for Sen. Hillary Clinton in the Democratic presidential primaries. Another group, Naral Pro-Choice America, will spend $10-million to influence voters at the general election on November 4.

Read The Chronicle’s report on efforts by charities to make presidential contenders address their issues.

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Obama Gives Charity $40,000 in 'Questionable Funds'

Sen. Barack Obama plans to donate to charity $40,000 from past political contributions linked to a former fund raiser who now faces federal corruption charges, reports the Associated Press.

Antoin Rezko, a Chicago real-estate developer, is charged with fraud, attempted extortion, and money laundering. The money came from seven people who gave money to Senator Obama’s House and Senate campaigns; none was for his current campaign to become the Democratic presidential nominee.

“Recent public information has called into question contributions to the Obama campaign from a donor and fund raiser,” said Bill Burton, a spokesman for Senator Obama. “Our consistent practice in these circumstances is to give the funds to charity out of an abundance of caution.”

The article does not say to which charities Mr. Obama will donate the money.

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Food Banks Facing Crisis as Donations Fall

Food banks are struggling to attract enough donations of food to keep up with an increasing demand from hungry families, reports the Los Angeles Times.

About one-fifth of food-bank supplies come from the federal government, says Kate Houston, deputy undersecretary for the U.S. Department of Agriculture’s Food, Nutrition, and Consumer Services. In 2001 the federal government bought $319-million worth of surplus food — but just $67-million worth in 2007 because of a strong market for farmers’ goods, the Times reports. Additionally, food makers have become more efficient and produce less extra food, which they used to donate to food banks.

Food banks and the food pantries they stock have been forced to open on fewer days with fewer items.

“The state of food banks, I think, in America — and in Los Angeles in particular — is really in dismal shape,” says H. Eric Schockman, president of Mazon, a charity in the California city. “Our emergency food system has really been unraveled over the last few years.”

In Los Angeles County, households whose food supply is unstable increased 17 percent between 2002 and 2005, says a report released last year by the county’s public-health department.

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New Director of Indian Museum Ready to Face Challenges

Kevin Gover, the new director of the Smithsonian Institution’s National Museum of the American Indian, says he is not concerned about the criticism the organization received for its former director’s spending and says he hopes the museum will become a center of scholarship, reports The New York Times.

Mr. Gover, a former law professor at Arizona State University and a member of the Pawnee tribe, takes the reins from W. Richard West Jr., who retired last month amid criticism over $250,000 he spent on travel and hotels and $48,500 for his museum portrait. Mr. Gover says he thinks the accusations of impropriety were unfair.

“We took a little hit on our image,” he said. “I worry about that in connection with the tribes. But in a very few months I think very few people will remember this.”

Mr. Gover, who worked for three years as assistant secretary for Indian affairs at the federal Interior Department, overseeing the Bureau of Indian Affairs, says he hopes American Indian tribes will “adopt” the museum financially. He also plans to visit Indians around the country to determine what they would like to see at the museum.

“It’s time for this museum to renew and strengthen its relationship with its primary constituents, which are the Indian tribes in this country,” he told the Times.

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Opinion: Government Falling Behind Donors in Solving Social Problems

The $7.3-billion given last year by America’s 50 most-generous donors, as reported in The Chronicle’s new survey, shed light on how little the American government gives to charities that care for the country’s neediest citizens, according to an editorial in The New York Times.

The Chronicle’s account of individual giving by billionaires and moguls is “great news for many worthy causes,” asserts The Times, which adds, “We’d be so much happier about all the good things America’s moneyed elite pay for if the government made needed public investments.”

Because private donations, which are tax deductible, reduce the revenue the government can collect, The Times editorial suggests that perhaps government should be allowed to take a bigger role in guiding where charitable donations are allocated so that they solve society’s most-pressing needs.

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Online Discussion: Views From a Top Donor

Read a transcript of today’s online discussion with Lorry Lokey, one of the donors on the Chronicle’s Philanthropy 50 list of the most-generous contributors of 2007.

Plus, mark your calendar for next week’s conversation about the best ways for people from the business world to move into nonprofit work.

From The Chronicle: Charity and Business

Nonprofit organizations make billions of dollars in income from activities unrelated to their charitable missions, but roughly half of the groups raising such funds pay little or nothing in federal taxes on the income, according to a new Chronicle analysis.

The newspaper based its analysis on a study of 990-T tax forms filed by many of the nation’s largest charities. Those forms are newly available to the public under a change in federal law.

From The Chronicle: Philanthropy in the Arab World

Prominent members of the royal families of Dubai, Jordan, and Saudi Arabia on Monday announced a plan to form a new organization to help coordinate philanthropic efforts across the Arab world, The Chronicle of Philanthropy reports.

January 18, 2008

Group Changes Fund-Raising Event's Name

In an effort to increase public awareness of its mission, the March of Dimes is changing the name of its biggest fund-raising event, Walk America, to March for Babies, The New York Times reports. The change was spurred by a 2006 Gallup poll indicating that while 85 percent of respondents thought the March of Dimes was a credible, trustworthy organization, only 45 percent knew the group’s mission.

The March of Dimes is one of the nation’s oldest nonprofit groups and raised $117-million last year through the charity walk. Despite the risks of losing support by changing the event’s name, Jennifer L. Howse, the president of the March of Dimes, said the organization hopes to spread the message that it offers services aimed at all mothers and babies, not just those who experience problems like premature birth.

“We had gotten to the point where people walking in Walk America didn’t necessarily know why they were walking,” Dr. Howse said. “They were there because someone they care about or someone at their office had asked them to walk.”

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