Friday, November 18, 2011

Planned Giving Tips: Principles For Effective Stewardship

Baby boomers are aging and as a result, planned giving campaigns have picked up.  An important part of these campaigns is stewardship.  Nonprofits must know how to effectively steward baby boomer donors and their gifts. 

During the 2011 Association For Healthcare Philanthropy (AHP) international conference in Boston, Mass., Katherine Swank, senior consultant at Target Analytics, offered her own principles for effective leadership based off of Kay Sprinkle Grace’s book Beyond Fundraising.  The NonProfit Times was there to record her tips, and here are some of them:
  • Engage the donor immediately
  • Don’t mix messages like sending a thank you with a gift ask
  • Carve out a budget for stewardship
  • Keep your stewardship in line with organizational image
  • Determine what kind of involvement your planned donors want outside of making a donation
  • Use current legacy donors to convey messages to potential legacy donors
You can read the rest of the tips on our website.

An Unfortunate Case Of Branding

File this one under unfortunate cases of branding.

You probably know by now that Jerry Sandusky, the central figure in the Penn State child sex abuse scandal, founded a charity called The Second Mile.  It's stated mission is "helping young people achieve their potential as individuals and as community members and providing education and support for their parents and youth service professionals."  Worthy goals, no doubt, but that mission has now been tainted by the charges against Sandusky.  As a result, a lot of people don't view The Second Mile in a very positive light.

In a recent article on The Huffington Post, we learn about the unfortunate effect the Penn State scandal has had on a Philadelphia-based organization called The Second Mile Center, a nonprofit thrift shop that helps ex-cons get back on their feet.  Although it shares a similar name to Sandusky's organization, they are in no way connected.  But given the similarity in the two names, people have confused the store with the scandal plagued charity.  Since the charges against Sandusky became public, The Second Mile Center has experienced a 30 percent drop in sales. 

Ron Lucas, who sits on the board of the nonprofit, told Weeklyxpress.com that they have received countless angry phone calls from people, most of whom hang up before they can explain that they have no connection to The Second Mile.  They have even put up signs on its door, one of which reads:
"We are not in any way connected to the Second Mile of the Penn State scandal. We are the Second Mile Center."
The Second Mile Center has been in existence for 30 years, while The Second Mile was formed in 1977.  It would be a shame if the negative attention towards that organization bought down this Philadelphia thrift shop.  In the mean time, Lucas and everyone else at The Second Mile Center can only hope people will start to learn the truth.

Wednesday, November 16, 2011

What Do The Occupy Wall Street Protesters Want?

In light of the eviction of the Occupy Wall Street protesters from Zuccotti Park in NYC, I thought I would bump up this post.

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Unless you've been living under a rock for the past month or so, you are probably aware of the "Occupy Wall Street" protests that have been going on around the world.  You probably have at least a vague idea of what sparked the protests: Anger over a perceived unfair financial system.  A system that a few years ago led to the worst economic crisis since the Great Depression, a crisis from which the country is still recovering.  Given the bailout of big banks, and huge bonuses paid out to their executives, it's easy to understand why people are angry.  Who wouldn't be?

Yes, it's pretty clear what these large masses are lashing out against.  What's not as clear is what the end game is for the protesters.  We recently posted a column by editor in chief Paul Clolery, set to appear in our Nov. 1 issue, that articulates this question.  It tackles some interesting contradictions of the protest, like how Occupy Wall Street supporters rail against unfair bank practices while embracing Russell Simmons, who sells pre-paid bank cards with monthly fees to poor communities.  That's a practice that is at least as bad as the questionable practices of banks.

The column's biggest issue with the protest is its lack of organization.  All of the social change movements in the past had a clear goal in mind.  The civil rights movement wanted equal rights for all.  The protests against the Vietnam War wanted an end to a conflict that had no end in sight.  How do the Occupy Wall Street protesters hope to get the change they seek?  These protesters need help from the charitable sector and seasoned protesters to help make a real impact on important issues like wealth disparity.  Right now, as the column opines, "it’s just an opportunity to post to YouTube."

Conflict Of Interest With Sandusky Judge?

The Penn State child sex abuse scandal is already one of the biggest stories in the news these days.  And now another layer of intrigue has been added thanks to a potential case of conflict of interest.

The Pittsburgh Post-Gazette reported yesterday that the state attorney general's office, which has charged former Penn State defensive coordinator Jerry Sandusky with 40 counts of sex abuse involving eight children, had sought bond of $500,000 and electronic monitoring.  This request was not granted by Judge Leslie Dutchot, who set bond at $100,000 unsecured, which Sandusky later met.  Why is this of note?  It turns out that Judge Dutchot volunteers for Sandusky's charity, The Second Mile

According to the Post-Gazette article, this information was listed on the website of the State College law firm Goodell & Yurchak.  Judge Dutchot would make no comment on the apparent conflict of interest.

Tuesday, November 15, 2011

Challenges In A Merger

For all the benefits of a potential nonprofit merger, it brings along as many risks and challenges.  How will existing departments function under the new management?  What will be the fate of current employees?  How will the merger be announced to the public?  These are all questions that can cause lots of headaches for nonprofit managements.  It's enough to make you reconsider going through with the merger.  Luckily, there's help on the horizon.

During the 2011 Risk Management and Finance Summit for Nonprofits, Eileen Morgan Johnson of Whiteford, Taylor & Preston LLP discussed the risks of nonprofit mergers and separations.  The NonProfit Times was in attendance for their tips, which included the following:
  • Periodically review governing documents.
  • If a potential conflict can't be avoided, make sure it is disclosed.
  • Don't be afraid to request a legal opinion when the issue warrants it.
  • Seek the advice of independent experts.
  • Insist on thorough documentation. This includes board minutes showing discussion and reports, memoranda and other documents considered in decision making.
  • Keep your employees informed of all new merger developments and provide ample opportunity for their feedback.  Nobody likes being kept in the dark.
  • Make sure that your fellow directors get copies of all proposed agreements or summaries.
  • Demand that board minutes accurately reflect votes.
Want to read the rest of the tips?  Read the full article over at The NonProfit Times.

Monday, November 14, 2011

Paterno, Penn State President Out

UPDATE, 11/14/2011: It was announced this morning that The Second Mile board of directors have accepted the resignation of Jack Raykovitz.  He had been CEO of the organization for 28 years.  Read more about this breaking story on our website.

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No doubt you have heard of the shocking child sex abuse scandal that has come out of Penn State.  Although it was former defensive coordinator, and founder of the charity The Second Mile, Jerry Sandusky who has been charged with allegations of sexually abusing children, much of the discussion has centered around top Penn State officials.  Two officials, Athletic Director Tim Curley and Vice President for Finance and Business Gary Schultz, have already been charged with perjury and failing to report suspected child abuse.  But much of the questioning has been directed towards legendary football coach Joe Paterno and Penn State President Graham Spanier.  And late last night, those two men became the first two to take the fall in this scandal, as the Board of Trustees at Penn State voted unanimously to relieve them of their duties.

The news broke late last night, only hours after Paterno announced he would retire at the end of the season.  The man affectionately known as "Joe Pa" said he was "devastated" by the developments and urged the Board "not to spend a single minute discussing my status."  Apparently they didn't take too kindly to that suggestion.

For Paterno, it's an unfortunate ending to a career that spanned 61 years.  He is the winningest coach in major college football history, leading Penn State since 1966 and turning it not only into a successful football team but an iconic brand in the sports world.  Even if you aren't too familiar with college sports, you probably have heard about Joe Paterno

All of this discussion about Paterno, Spanier, and other Penn State officials obscures the serious crimes for which Sandusky is being accused.  Reading the Grand Jury testimony (WARNING: Contains graphic descriptions) from wide-receiver coach Mike McQueary, who alleges to have witnessed Sandusky molesting a young boy, is chilling.  What's even more disturbing is that because this went unreported to the police, Sandusky wasn't barred from activities with children at his charity until 2008.  That's when he informed them he was under investigation.  And even then, he didn't officially leave the organization until he retired in 2010. 

In yesterday's report on The NonProfit Times, we reported on The Second Mile's tax filings and annual report.  They indicated that the organization experienced a $228,000 operating deficit last year.  In addition, revenue fell to $2.1 million, from $4.1 million in 2008.  The 12-page annual report cited overall giving to charities being down 11 percent last year as the organization’s board used a “rainy day fund to provide needed services” as it “received more requests to help children and teens than ever.”  With these revelations about Sandusky's alleged crimes now coming to light, it's unclear how much longer the charity will be able to operate.

This story will undoubtedly continue to evolve over the coming weeks and months.  Stay tuned to The NonProfit Times for any new information that comes out on the case or the future of Second Mile.

Veteran's Day

Hope that everybody had a great Veteran's Day Weekend!  In honor of the just passed holiday, I would like to direct our readers to an article we recently posted about the number of unemployed veterans.  Here is an excerpt from that piece:

As 39,500 Iraqi troops are scheduled to make their return this December, nonprofits have begun the charge of increasing service programs, while trying to fundraise more for the sudden influx of new clients.


“The key is getting to soldiers as soon as possible,” said Stephen Nardizzi, president and CEO of Wounded Warrior Project (WWP) in Jacksonville, Fla.. “A lot are returning to isolated communities, which is different from what you’ve seen in past conflicts.”


The unemployment rate for veterans stands at 12 percent, 3 points higher than the national average. In October alone, 240,000 new veterans were looking for jobs. In addition, one in five soldiers is reportedly suffering from Post Traumatic Stress Disorder (PTSD). Nardizzi estimated 300,000 to 600,000 soldiers are dealing with a traumatic brain injury. More than 1 million Americans have served in Iraq, and 39,500 troops will return by year’s end.


Nardizzi sees traumatic brain injuries and PTSD as the biggest issues veterans face, but realizes a full integration in today’s society means using a combination of therapies. “It’s a lot like the legs of a table. They all impact each other. We will have programs that will engage soldiers in team-building activities, but we also have counseling services,” he said.


For WWP, the expectation for increased services has been planned. The organization has experienced “incredible growth” during the past five years, from $40 million 2010 to $68 million this year, and a goal of reaching $90 million next year.


“We took that next step in fundraising about two years ago, when we saw depressed numbers coming back and invested in our direct response services,” said Nardizzi. “We’ve been trying to attract online donors, but this year we also heavily invested in direct response television. We had a very similar approach to television to what we’ve done in direct mail.”