Treating the District of Columbia Like a Full-Fledged State Regarding Nonprofit Oversight
posted on: Sunday, June 04, 2006
The free daily newspaper, the DC Examiner, ran a short item on June 1st with the news that the DC Attorney General, Robert Spagnoletti, discovered that his office had just about no powers to investigate and regulate errant nonprofits. It surprised the DC City Council too to learn that DC's AG was less of an AG than other states'.
The response from the head of DC's Nonprofit Roundtable dredged up the old bad apples argument, that "(t)he District has more important priorities 'than a few apples that don’t quite smell right.'" He suggested that the nonprofit sector is already well-regulated by the IRS. An interesting but flawed argument not only for nonprofits, but for the District of Columbia.
For nonprofits, the Roundtable spokesperson's contentions fly in the face of everything that has been learned in the past two years of Senate Finance Committee hearings and the deliberations of Independent Sector's Nonprofit Panel. The IRS's oversight and enforcement capabilities have been demonstrated to be woefully inadequate, notwithstanding the need for stronger laws and regs to deal with the range of abuses that have been front page fodder across the nation. The IRS's tax exempt unit needs a larger and more regular infusion of cash than anyone on Capitol Hill appears ready to support.
The Committee and IS have also recognized that effective oversight requires not only the IRS, but the charity offices under state AGs. Some things can be better done by state rather than federal investigators, and in fact, some of the few successes in government oversight of nonprofits have emanated from investigations, jawboning, and when necessary prosecutions from the dozen or so states with active charity oversight and enforcement efforts.
From the perspective of DC, however, the Roundtable spokesperson's comments are doubly troubling. The Roundtable is an organization purporting to represent nonprofits in the metro Washington area. Given the size and population of the District, it's hard to imagine another part of the nation with a greater concentration of nonprofits than this small area lodged along the Potomac. Many of the Roundtable's members are strong advocates to give the District of Columbia the rights of full statehood in contrast to its current semi-colonial status. Why shouldn't the attorney general of DC be accorded the same powers that other state AGs possess, unless somehow DC is to be treated as less than a full-fledged state.
For nonprofits again, however, the Roundtable person's other point, that the District has more pressing issues than the ethics and accountability of the bevy of nonprofits with DC addresses. That sells the nonprofit sector short. Nonprofits are a huge proportion of the DC workforce and a huge part of the metro area's ability to respond to the needs of its disadvantaged and disenfranchised residents. To treat nonprofit accountability as something that's not all that important is to classify nonprofits as a sideshow, just not that important.
Maybe the Roundtable missed the Washington Post coverage of national accountability shortcomings in the sector such as the series on The Nature Conservancy, the running coverage of Jack Abramoff's Capital Athletic Foundation, and the detailed investigation of Archie Prioleau's Foundation for Educational Innovation. No, the Roundtable really didn't miss these articles in the local press or dozens of others, including the past few years' coverage of scandals at the National Capital United Way, as recently as a May 22nd report about some not-so-funny accounting at the United Way.
Nonprofits are serious business, nonprofit improprieties deserve investigation and resolution, sometimes by government, and it needs the state government's involvement, not just the IRS's. To imagine that DC doesn't deserve an attorney general's office with nonprofit oversight and enforcement powers comparable to any real state government is to sell short the government and residents of the District of Columbia. (RC, 6/4/06)
The response from the head of DC's Nonprofit Roundtable dredged up the old bad apples argument, that "(t)he District has more important priorities 'than a few apples that don’t quite smell right.'" He suggested that the nonprofit sector is already well-regulated by the IRS. An interesting but flawed argument not only for nonprofits, but for the District of Columbia.
For nonprofits, the Roundtable spokesperson's contentions fly in the face of everything that has been learned in the past two years of Senate Finance Committee hearings and the deliberations of Independent Sector's Nonprofit Panel. The IRS's oversight and enforcement capabilities have been demonstrated to be woefully inadequate, notwithstanding the need for stronger laws and regs to deal with the range of abuses that have been front page fodder across the nation. The IRS's tax exempt unit needs a larger and more regular infusion of cash than anyone on Capitol Hill appears ready to support.
The Committee and IS have also recognized that effective oversight requires not only the IRS, but the charity offices under state AGs. Some things can be better done by state rather than federal investigators, and in fact, some of the few successes in government oversight of nonprofits have emanated from investigations, jawboning, and when necessary prosecutions from the dozen or so states with active charity oversight and enforcement efforts.
From the perspective of DC, however, the Roundtable spokesperson's comments are doubly troubling. The Roundtable is an organization purporting to represent nonprofits in the metro Washington area. Given the size and population of the District, it's hard to imagine another part of the nation with a greater concentration of nonprofits than this small area lodged along the Potomac. Many of the Roundtable's members are strong advocates to give the District of Columbia the rights of full statehood in contrast to its current semi-colonial status. Why shouldn't the attorney general of DC be accorded the same powers that other state AGs possess, unless somehow DC is to be treated as less than a full-fledged state.
For nonprofits again, however, the Roundtable person's other point, that the District has more pressing issues than the ethics and accountability of the bevy of nonprofits with DC addresses. That sells the nonprofit sector short. Nonprofits are a huge proportion of the DC workforce and a huge part of the metro area's ability to respond to the needs of its disadvantaged and disenfranchised residents. To treat nonprofit accountability as something that's not all that important is to classify nonprofits as a sideshow, just not that important.
Maybe the Roundtable missed the Washington Post coverage of national accountability shortcomings in the sector such as the series on The Nature Conservancy, the running coverage of Jack Abramoff's Capital Athletic Foundation, and the detailed investigation of Archie Prioleau's Foundation for Educational Innovation. No, the Roundtable really didn't miss these articles in the local press or dozens of others, including the past few years' coverage of scandals at the National Capital United Way, as recently as a May 22nd report about some not-so-funny accounting at the United Way.
Nonprofits are serious business, nonprofit improprieties deserve investigation and resolution, sometimes by government, and it needs the state government's involvement, not just the IRS's. To imagine that DC doesn't deserve an attorney general's office with nonprofit oversight and enforcement powers comparable to any real state government is to sell short the government and residents of the District of Columbia. (RC, 6/4/06)
posted by NCRP at
11:04 PM
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