It’s time to invest in ACORN again

By Aaron Dorfman

It’s time for funders to resume funding ACORN, and to consider major new investments in the organization in the coming year. In times like these, the country needs ACORN back at full strength.

I wrote a critical blog posting about ACORN’s embezzlement scandal a few months ago, and I’ve been following the situation ever since. I’ve been extremely impressed with the openness and leadership of Bertha Lewis, their new Interim Chief Organizer and I am convinced that ACORN is systematically addressing the problems that led it into such trouble.

Has ACORN fixed everything in 90 days that needed fixing? Of course not. But it’s clear that the organization is committed to solving the problems and they are well on their way to doing so.

The most important development is that the organization’s board is much more engaged than it ever was under the leadership of Wade Rathke. When they finally learned about what happened, they took decisive action, and they are now attempting to fulfill their proper roles of governance and oversight. They’ve identified their weaknesses and are seeking training in the areas where they need help. There is still some controversy on the board, and it’s going to be a messy process, to be sure. But my overall assessment is that funders should have confidence that the board is now properly engaged and that the ship is sailing in the right direction.

Another important development is that mid-level staff – the ones who really make the campaigns happen at ground level – are excited and hopeful about the future of the organization under Ms. Lewis’ leadership. She has been sharing information openly with staff of all levels, which is a welcome culture change for the organization.

The country needs ACORN back at full strength as soon as possible, and that will require serious investment by foundations. The financial markets are in turmoil, and ACORN’s track record shows that it can be one of the most effective voices for ensuring that the interests of those most at risk in any economic downturn, including the hundreds of thousands of low and middle-income homeowners caught up in the foreclosure crisis and financial market meltdown, are protected in bailout discussions. Most importantly, a new administration will take office in January, and the American people need ACORN at the table fighting for communities that so often get left out. They have the capacity to have major impact, but they’ll need funding to make it happen.

Aaron Dorfman is executive director of the National Committee for Responsive Philanthropy.

Foundations, Where Art Thou?

Rural Louisiana left wondering after Ike and Gustav wreaks havoc

By Yna Moore

It’s been almost two weeks since Hurricanes Ike and Gustav battered the rural coastal parishes of Louisiana and most of the foundation world seems not to take notice.

True, Gustav and Ike were not the monster storms that Hurricanes Katrina and Rita were in 2005. Perhaps there’s an assumption that the need for disaster assistance is less. Nothing can be farther from the truth.

Rural Louisiana is home to many low-income families who lost homes and livelihoods, which are mostly farming, fishing and small family businesses, in the wake of Katrina and Rita. The area was still in the midst of rebuilding when the two recent hurricanes struck the area.

The effect of these hurricanes brings home one sad fact—disasters disproportionately affect the poor: those that can’t afford land; those that have nowhere else to go and no one else to turn to; those that rely on the help of others to survive; those that have no money to tackle on their own the daunting task of rebuilding.

Sister Helen Vinton, assistant executive director of the Southern Mutual Help Association and NCRP board member, informed us that the country’s foundations are largely absent in responding to the pleas for help from Louisiana’s rural communities despite great need.

So to foundations across the country, big and small: they need your help! This is your chance to have an impact on the lives of thousands of Americans struggling to rebuild and recover from these natural disasters. There are many nonprofit organizations in the frontlines that will put your foundation’s dollars to good and worthwhile use. Will you take heed?

Do you know of foundations who are responding to the needs of rural areas affected by Hurricanes Gustav and Ike? How can the country’s foundations best help relief and recovery efforts? Please, tell us about it!

Kristina “Yna” Moore is communications director at the National Committee for Responsive Philanthropy (NCRP).

What Congressionally Chartered Organizations Have in Common: Big Trouble

What Congressionally Chartered Organizations Have In Common:
Big Trouble
By Gary Snyder

What is it with these congressionally chartered organizations? We have seen numerous congressionally chartered organizations fail to carry out the responsibilities delegated to them by the federal government.

What are Congressionally Chartered Organizations?
A congressionally charter is a law passed by Congress that states the mission, authority and activities of a group. Being chartered by Congress is like bring incorporated at the federal level. They are listed in Title 36, Subtitle II, of the U.S. Code. 9 (thus called ‘Title 36 corporations’)

Congress has issued federal charters since 1791, sometimes creating corporate entities but more often recognizing a wide range of groups that already are incorporated at the state level. There about 100 charters.

The charters are honors. The main attraction for national organizations is that it tends to provide an ‘official’ imprimatur to their activities and to that extent it may provide the prestige and indirect financial benefit.

To be eligible for a charter, an organization generally must engage in activities that are clearly in the public interest and be of a unique type.

In recent years, some in Congress have expressed concern that the public may be misled by its chartering process into believing that somehow the U.S. government approves and supervises the corporations, when in fact this is not the case. At present, federal supervision of congressionally chartered nonprofits are limited. They are required to have independent audits annually and annual reports of their activities, with both reports submitted to Congress.

Many of the very recent controversies often comes down to fundamental issues of managerial accountability and fiduciary responsibility.

There are many controversies but a few stand out. In 2000, the Boy Scouts of America had an assistant scoutmaster who professed and practiced a homosexual lifestyle. The U.S. Supreme Court ruled that the Boy Scouts are within their First Amendment rights as a private organization to exclude from a leadership position a person who was fundamentally in disagreement with its purposes as an organization.

But most recently, four organizations have embarrassed the Congress in the way that they have conducted themselves.

The Smithsonian Institution, a congressionally chartered nonprofit organization, was forced to create a Committee on Governance after the chief executive or secretary incurred lavish and extravagant expenditures. These expenses included charted jets, $160,000 to redecorate an office, more than $1 million in housing allowances and household expenses of more than $600,000 over several years. It was dragged though the press because of pressure for change in leadership and governance by the Senate Finance Committee.

Another stalwart nonprofit-- the federal chartered American Red Cross—also under the pressure from Congress recommended sweeping changes to it governance. The high profiled problems included political appointees, rich opportunities for cronyism and conflict of interests, turnover of chief executives, on average, every 2 years or so, steep severance payouts, sex scandals, poor monitoring of finances, in constant trouble with the Federal Drug Administration for the quality of its blood bank, severe fines (tens of millions of dollars) and more. The deficit at the Red Cross surpasses $200 million.

The nation is currently faced with further financial uncertainty because of two other congressionally chartered organizations but privately held, the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association. The two firms recently suffered billions in losses due to the unprecedented number of defaults and foreclosures in the U.S. housing market. Both were put under conservatorship of the U.S. Federal government. It has been widely touted as one of the most sweeping government interventions in the U.S. history. Because of distrust in their leadership, the government dismissed their chief executives, board of directors and elected a new board.

There is a history of problems at Freddie Mac. It had understated it earnings by billions of dollars and was fined $125 million. An oversight report indicated that the company’s earnings were manipulated. Two years ago, it was fined $3.8 million, the largest ever assessed, because of illegal contributions.

Ending the Chartering Process?
All of the aforementioned-chartered organizations have asked the government for some sort of bailout.

The House Judiciary Committee, the key committee in the process, in 1992, concluded that the chartering process served no useful purpose. It issued a moratorium. However, bypassing the committee, Congress chartered at least three new nonprofits organizations.

Many of the congressionally chartered organizations have lost their way. I expect much discussion about the value of the designation. It has become an embarrassment and certainly a distraction from the good work of the activities of other chartered charitable, historical and educational organizations.


Gary Snyder is managing partner of Nonprofit Imperative and author of Nonprofits: On the Brink and Nonprofit Imperative. He can be reached at gary.r.snyder@gmail.com. His website is: www.garyrsnyder.com.

New NCRP, EPIP Partnership to Bring Policy Briefing Series

National Committee for Responsive Philanthropy to provide EPIP members with exclusive, cutting-edge policy briefings by conference call


Last month, Emerging Practitioners in Philanthropy (EPIP) announced a new partnership with the National Committee for Responsive Philanthropy (NCRP).

EPIP and NCRP are working together to increase the effectiveness of foundations by ensuring that the next generation of grantmakers is informed and engaged in the cutting-edge public policy and research currently impacting philanthropy and nonprofits.

Through this new partnership, NCRP will deliver policy briefings via conference call that are custom-designed for emerging grantmakers. These briefings will be available exclusively to dues-paying members of the EPIP network.

In addition to briefings, EPIP will keep members informed of new NCRP research and publications, and EPIP members will be eligible for a 50% discount on NCRP membership. Information on how to access this discount is forthcoming.

The first briefing will address controversial public policy efforts to increase foundation support for nonprofits led by and working in communities of color. These efforts were targeted in the state of California and became part of the national discourse of philanthropy through the recently defeated legislation AB624 in the California legislature. This conference call will take place on Wednesday, September 24th, 2008. It will begin promptly at 4:00pm ET, and will run for one hour.

EPIP members interested in participating must RSVP to rsvp@epip.org. Use the following text as your subject line: “RSVP for 09.24.08 Phone Briefing”. Only individuals who RSVP will be provided with call-in information and materials. Participants in the EPIP network who wish to participate may join EPIP by clicking here.


About the Partners:

Emerging Practitioners in Philanthropy seeks to strengthen the next generation of grantmakers, in order to advance effective social justice philanthropy. It serves a diverse membership of young and new foundation professionals through a network of chapters, professional and leadership development programs, and an advocacy voice on philanthropic effectiveness, generational change, and social justice issues in the field.

The National Committee for Responsive Philanthropy promotes philanthropy that serves the public good, is responsive to people and communities with the least wealth and opportunity, and is held accountable to the highest standards of integrity and openness. Since 1976, NCRP has used research and advocacy to urge the philanthropic community to provide nonprofit organizations with essential resources and opportunities to effectively serve disadvantaged and disenfranchised populations and communities.