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The team from Charity Navigator, the nation's largest independent charity evaluator and leading donor advocate, shares their thoughts on emerging nonprofit-sector issues and offers tips to better inform your intelligent giving decisions.

Tuesday, June 30, 2009

Mashable Launches Social Media Fundraiser

Mashable, an on-line social media guide, has launched a summer-long event to benefit four well known charities. The fundraising drive, known as the Summer of Social Good, will be promoted exclusively through three top social media sites: Facebook, Twitter, and MySpace. Mashable is collecting money for a pooled fund that will be divided evenly between The Humane Society, LIVESTRONG, Oxfam America, and the World Wildlife Fund by encouraging donations as well as asking fans to promote the cause on their own social media pages. Three of the four charities have earned our top, four-star rating.

The donations drive is the first initiative organized by Social Media for Social Good, which will act as an umbrella organization for charities using social media to promote their cause, according to their website, and is organized by Mashable. We’ve seen lots of creative social media fundraisers recently such as Twestival and Target’s Facebook competition. Be sure to visit the Summer of Social Good website by August 28th if you’d like to donate, or add a tweet or wall post to spread the word!

Monday, June 29, 2009

When Was The Last Time You Visited An Arts Museum?

Two recently released studies (one by The National Assessment of Educational Progress and one by The National Endowment for the Arts) show that attendance at art museums is on the decline – both among students and adults. The NEA’s study also showed a drop in participation in performing arts.

The NEA attributed the decline to an aging out of the traditional arts audience and also to the increase in consumption of arts online, rather than by attending live events. Both the NEA and the NAEP call for more arts education as a way of developing the next generation of arts enthusiasts.

As we've pointed out in the past, the recession may be especially hard on arts groups which experience both declines in contributions and grants (from individuals, foundations, corporations and the government) and decreased ticket sales. So, if you're a fan of the arts like me, then consider including a visit to a museum or theatre as part of your summer plans.

Friday, June 26, 2009

Timeline of Giving in America

Our country has a long tradition of giving. In fact, the first record of a fundraising drive in America, organized by Harvard University, occurred in 1643. Learn more about this, and other milestones in the development of America’s philanthropic marketplace, on Charity Navigator's site.

Thursday, June 25, 2009

A Win Win Situation

As the economy continues to cause problems for both companies and employees, one company is taking a unique approach to its business while providing a benefit for local charities. California Steel Industries, experiencing slower than usual demand, made the decision to re-assign its employees to projects at local charities rather than laying them off. The employees are performing a variety of tasks, including yard work and painting, for local organizations. In addition to the benefit of keeping its workers employed, California Steel will have the added bonus of a tax write-off at the end of the year.

Wednesday, June 24, 2009

New York Luxury Condo "Goes" Homeless Shelter

A luxury condo development in Brooklyn has been turned into a homeless shelter. The city will pay $90 a night for an apartment which includes marble baths and granite countertops. The original sale price for each apartment was approximately $350,000, but as a result of the housing market decline the developer and a non-profit agreed to use it as homeless shelter. Local neighbors who liked the idea of having a luxury building in their area started a petition to stop the condo from being used as a shelter. In addition, some who were considering buying or renting a unit are unhappy that they have been turned away. The condo developer and the Department of Homeless Services believe they used "outside the box thinking to benefit all those involved." Regardless how you feel about this particular solution to the homeless problem it is important to consider giving to charities working in this area. Today, with the state of the economy and the recent housing crisis, charities assisting the homeless are under great demand. You can review some highly rated charities working in this cause here.

Monday, June 22, 2009

National Service in the Summer Months

When the going gets rough, American volunteers get going. So it's a good thing the Corporation for National and Community Service (CNCS) and Michelle Obama recently announced a new Summer of Service plan. Interested participants can visit www.serve.gov to find nearby volunteer opportunities that address: environmentalism and sustainability, education and literacy, access to healthcare and public health, and assistance to communities deeply touched by the economic downturn.

This isn't the first time we've seen valiant efforts from American volunteers or support for such initiatives by powerful political representatives. As noted in previous posts, a quarter of Americans volunteered last year, with teens being a major constituent. The Obamas have been long-standing supporters of service and intelligent giving. Michelle Obama has recommended the use of Charity Navigator to find worthy charities.

Friday, June 19, 2009

News Featuring Charity Navigator's Data

Here's a roundup of some of the media coverage Charity Navigator received this week.
  • Slate columnists Patty Stonesifer (chair of the Smithsonian Institution Board of Regents and a senior adviser to the Bill and Melinda Gates Foundation, where she was president, then CEO for 10 years) and Sandy Stonesifer (project manager for a national study of the consequences of unintended pregnancy) responded to a reader's request for guidance in determining what is an excessive/ reasonable level of compensation for a nonprofit CEO. Their thoughtful answer is right on the mark and references Charity Navigator's research in this area.

Thursday, June 18, 2009

Give Dad The Gift Of Charity

Father's Day is Sunday!

Are you at a loss for what to get dad? Give him the gift of charity. It’s hard to think of a more thoughtful and unique gift.

But, maybe you’re not sure which charity your dad is interested in supporting. No problem. Purchasing a Good Card gives him the ability to select the charity to receive the donation.

Philanthropy Feature on AOL News

The Philanthropy Project, created with a $10 million grant by the John Templeton Foundation in October 2007, works to inspire everyone to become a philanthropist by highlighting the good works of the 72,000 foundations that exist in America.

The Philanthropy Project, in partnership with AOL, recently launched a new site, http://news.aol.com/philanthropy, to promote the benefits of living a philanthropic lifestyle. Visitors to the site can check out videos about giving, find links to philanthropic resources (including Charity Navigator) and take a quiz, the GlowMeter, to determine their philanthropic preferences and to connect with others that have similar charitable interests.

Wednesday, June 17, 2009

Guilty of Charity Fraud

As if we needed more proof that donors need to research the charities requesting their support and be especially weary of groups (often soliciting by phone) purporting to support causes that tug at our heartstrings (such as military, police, fireman and sick kids), there comes news about George Borden. What did Borden do? An investigation by the Massachusetts AG’s office revealed that while Borden was claiming to raise money for charities that support disabled veterans and retired police, he was really spending the donations on himself.

In this case, more than a thousand donors were duped out of more than one hundred thousand dollars. Sadly, this case is not unique. Bogus and inefficient fundraising schemes occur throughout the US.

Tuesday, June 16, 2009

Free Webinar

Visit Ken's Commentary for information about Ken Berger's participation in an upcoming, free webinar: Ken Berger to Address Need for Performance Management Via Webinar

Melinda Gates named Second Most Creative Person for Foundation Work

Fast Company magazine has just released their list of the 100 Most Creative People in Business, and Melinda Gates earned the number two spot for her work for the Bill and Melinda Gates Foundation. Fast Company reports Melinda has “Championed not only big-picture, tech-oriented solutions to improve health and education over the long term but also more modest steps to help the poorest of the poor right now.” Her latest project includes integrating health and education messages into Viacom TV programming, a strategy used successfully in developing countries by organizations like PCI-Media Impact. The Gates Foundation has funded many of our top-rated organizations, including PATH, Grameen Foundation USA, International Rescue Committee, and Save the Children. Congratulations to Melinda for her on-going efforts with the Foundation and the recognition it earned her!

Monday, June 15, 2009

San Francisco Charities Facing Tough Times

With a drop in donations, and an increase in demands for services, San Francisco area charities are bracing for a rough future, with about one third of the organizations participating in a United Way of the Bay Area survey expecting to shut down in the next year. As Charity Navigator has mentioned before, this is a development that is not unexpected given the current situation. We want to reiterate that instead of all these organizations closing, and thereby leaving those dependent on the services stranded, a close look should be taken at the possibilities of organizations merging their operations. This development will lead to more efficient non-profits working in the area, and in turn it will be easier for donors to identify which organizations they wish to support. We hope the 26% of charities already reporting to have cooperated with other local organizations can continue to do so, and increase their cooperation levels.

Thursday, June 11, 2009

Giving in 2008

Giving USA’s annual report on giving in America is out this week and it offers both good news and bad.

The Good

  • Charities in America received $307.65 billion in donations last year.

  • As in previous years, giving represents about 2% of GDP.

  • As we’ve seen historically, individuals are responsible for 75% of the giving ($229.28 billion).

  • Foundations, that saw their endowments shrink considerably, did not pull back on their grants as much as was anticipated. Grants from foundations actually grew by 3% (or -0.8% when adjusted for inflation) to $41.21 (13% of total giving).

  • Religious charities experienced a 5.5% increase in giving (or 1.6% when adjusted for inflation) to $106.89 billion. Thus, about half of contributions from individuals are directed to religious charities.

  • Public Benefit charities grew contributions by 5.4% (1.5% adjusted for inflation) last year to $23.88 billion or 8% of all giving.

  • Gifts to International charities were essentially flat with growth of just 0.6% (-3.1% when adjusted for inflation) to $13.3 billion (4% of the total).

The Bad
  • Our generosity declined from 2007 levels (a record $314.07) by 2% in real dollars and 5.7% after adjusting for inflation.

  • 1974 was the only other year in the history of this survey (started in 1956) that contributions shrank almost as much (5.4%).

  • Specifically, individuals gave 2.7% less in 2008 (-6.3% adjusted for inflation), charitable bequests fell by 2.8% (-6.4% adjusted for inflation) to $22.66 billion (7% of total giving), and corporate giving dropped 4.5% (-8% adjusted for inflation) to $14.5 billion (5% of total giving).

  • Human Services charities were the recipients of $25.88 billion in donations representing a dropped 12.7% in current dollars (15.9 % when adjusted for inflation). Only 9% of all giving in 2008 went to these charities. This is disturbing considering the increase in demand for the programs and services offered by these charities. Furthermore, this seems to go against previous reports that show giving to human services charities tends to increase during a recession (although usually not enough to offset the increase in demand).

  • Education charities experienced a 5.5% decrease (-9% adjusted for inflation) to $40.94 billion (13% of the total).

  • Health charities report a 6.5% decrease (-10% adjusted for inflation) in giving. The $21.64 billion these organizations received represents 7% of total giving in 2008.

  • Not surprisingly, given the extensive reports of layoffs and programmatic cutbacks reported by arts groups (detailed on this blog here, here, and here), Giving USA shows that contributions to Arts, Culture, Humanities charities dropped by 6.4% (-9.9% adjusted for inflation) to $12.79 billion. Gifts to arts groups represented 8% of the total giving.

  • Giving USA lumps together gifts to Animals and Environment charities. These groups received 2% of the total giving ($6.58) which is a 5.5% decrease (-9% adjusted for inflation).

The Ugly

  • It will be quite some time before contributions pick up as the historical data shows that it took three years for giving to rebound after the recession in 1974.

Wednesday, June 10, 2009

More Scrutiny of CEO Pay

Today, comes news, that President Obama’s administration seeks more oversight of executive pay at for-profit firms. Those in the nonprofit sector should take note. The public’s and regulators’ concern in this area is likely to spill over into the charitable sector.

Already, the comments on our site show donors regularly lamenting about what they deem to be excessive pay packages at the charities seeking their support. The IRS has, for years, warned charities of its interest in compensation practices. And in designing the new Form 990, the IRS now requires more disclosure of executive pay.

At Charity Navigator, for each charity we rate, we already disclose the CEO’s salary as well as other salaries of note. This summer we’ll publish an updated CEO Compensation Study. And this fall, we hope to begin publishing information from the newly designed Form 990s, letting donors know, for example, if the charity had an independent committee set pay.

Charity Navigator's Leader To Speak At Upcoming Conference

Charity Navigator's president and CEO, Ken Berger, will be speaking this fall at ETOlution 2009 - a conference that provides nonprofit professionals with practical suggestions, best practices, and working examples to help them in their work in improving the quality of life within their communities. Ken is part of a panel discussion, "Improving How We Give," that will discuss and debate the effectiveness of today's funding practices.

What: ETOlution 2009 Conference
When: November 16-17, 2009
Where: Baltimore, MD

Sign up now! Discounted, early registration ends June 30.

Tuesday, June 9, 2009

What's in a Name? Part 2

Last fall on this blog we discussed the issue of well known charities changing their names and how that may affect their visibility to the public. Back then America's Second Harvest and Y-Me National Breast Cancer Organization changed their names to Feeding America and Breast Cancer Network of Strength respectively. We have not yet heard of any drastic effects the name change has caused, good or bad. Next month, another well known, long standing organization is changing its name. Beginning July 1st, the Christian Children's Fund, founded in 1938, will be known as ChildFund International. The organization has stated that "the name ChildFund international reflects the true breadth and international scope of our work." The change also has a religious aspect to it as the organization is removing "Christian" from the name. The organization does not work to spread the Gospel and considers itself non-sectarian. Removing "Christian" from the name may help to avoid some confusion in regards to the overall goals of the organization. This is not the first name change for this organization as they were originally founded as China's Children Fund.

Monday, June 8, 2009

Free Webinar: What Executive and Development Directors Need to Know

Sign up for a free webinar in which Charity Navigator's president and CEO, Ken Berger, will engage in conversation with Isaac Castillo, the Latin American Youth Center's (LAYC) Director of Learning and Evaluation, about performance management and how it's critical to fundraising. The webinar, Increasing Funding through Performance Management, starts at 3:00 pm (Eastern Daylight Time) on June 25th.

Friday, June 5, 2009

Where are your donations going?

Tampa Bay's WTSP-TV / 10 Connects recently singled out Charity Navigator as a helpful online tool for donors. The piece also highlighted Metropolitan Ministries as one of the Bay area's thirteen 4-star rated charities. Here's the video:

Thursday, June 4, 2009

Thank You!

A resounding Thank You! to all of our donors--both established and new--who have made our Spring Donor Drive such a resounding success. For the first time, we e-mailed our registered users asking for their support and the response was amazing. The heartfelt and often touching comments we received about the work we do on behalf of America's donors have made us feel so connected to all of you. That means a lot to us because we aren't on the front lines doing direct service delivery like the charities we rate. The fact that so many of you think that what we do is vitally important and have told us so mean the world to us. If you'd like to join our donor family, you may do so here. Your support is vital to us and is deeply appreciated.

Wednesday, June 3, 2009

NJ Nonprofits

This past winter, 351 NJ charities shared some pretty bleak financial data with The Center for Non-Profits demonstrating just how extensively the recession is impacting their fiscal health. Here are some highlights from the survey:

  • 70% report that demand for their core services has increased during the past year. They anticipate this trend to continue into next year.
  • 33% report that expenses exceeded support and revenue in their most recent fiscal year.
  • >60% anticipate an increase in total expenses this year, but less than 1/3 expect total funding to increase.
  • 89% reported a dramatic change in funding in 2008.
  • 60% said a previous funding source had told them that future giving to their charity would be less or nonexistent.
  • 29% had already or planned to cut back on their programs and services.
  • 34% had or will cut staff.
  • 48% are increasing their collaborative efforts.
For those who care about the philanthropic sector in NJ, we encourage you to visit our site to find a group worthy of your support (remember Charity Navigator is a NJ nonprofit). If you are a nonprofit professional and the above rings true, then we encourage you to read our President's blog entry, Advice to Charities in Hard Times, which is based on a discussion he had with nonprofit executives in NJ.

Tuesday, June 2, 2009

New Disclosure Demands on Colleges & Universities

A report recently released by the Congressional Budget Office (CBO) has led Senator Charles Grassley (R-IA) to call on Colleges and Universities to disclose how their commercial revenue is used to fulfill their educational purposes. The CBO report titled "Tax Preferences for Collegiate Sports" states that "Colleges and Universities qualify for preferential treatment under the federal income tax law....but concerns have arisen that some activities undertaken are only loosely connected to educating students and might be viewed as unrelated to the schools tax favored purpose." Schools with well known sports programs are the focus as they generate large amounts of commercial revenue and act more like a business than a school. The report raises the notion that this revenue should not fall under the same preferential tax treatment as education related revenue. Senator Grassley wants colleges to disclose how their commercial revenue is used to fulfill their educational mission. "This report shows colleges receive tax benefits that aren't available to private businesses that engage in the same commercial activities" said Grassley.