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NY Gov. Proposes Salary Cap For Nonprofit Execs
May 17th
As reported by The Daily News, the new rule would cap the amount of money towards an executive's compensation package at $199,000. The actual pay package could be higher, but the nonprofit would have to find new funding sources to make up the difference and get special permission. Salaries could also fall no higher than the 75th percentile for the field in which the organization works.
The new rule would only impact nonprofits that receive 30 percent of their total funding from the state. The Daily News reported that the Bronx-based Soundview health clinics -- run by recently convicted ex-state Sen. Pedro Espada -- would have been in real danger of losing state funding. Nearly half of the organization's funding came from the state, and Espada's $612,000 salary placed him above the 75th percentile in that field ($380,000).
Gov. Cuomo's announcement shouldn't come as a surprise. He vowed to crack down on excessive pay for executives during his State of the State address in January. Before that, he created a task force to investigate pay at nonprofits that receive taxpayer money. This stemmed from a New York Times article that reported high salaries and perks at the Young Adult Institute. Executives at that organization reportedly received $1 million a year, in addition to ethically questionable perks, such as billing the nonprofit to cover their children's college tuition.
You can read the full article on Cuomo's announcement on The Daily News' website.
Nonprofit Sues California Over Teacher Tenure Laws
May 16th
A nonprofit education group is suing the state of California over five laws they say protect ineffective teachers and lower school quality for poor children.
Los Angeles-based Student Matters filed the lawsuit today with the goal of getting the laws overturned, according to a report on KQED News. The laws in question set up a seniority system for public schools in the state.
According to the organization's website, Student Matters is "committed to ensuring that all of California’s children receive a quality education." It is run by David F. Welch, an executive at a Silicon Valley fiber-optic communications firm.
Josh Pechtalt, president of the California Federation of Teachers, said in a statement that the lawsuit is "misguided," and that the real problems of public education stem not from teachers, but from money.
"The real problems of public education really are not about teachers having due process rights," he said, "the problems have to do with massive cuts to the classroom, and frankly defunding of public schools now for a number of years."
You can read the full story on KQED's website.
Los Angeles-based Student Matters filed the lawsuit today with the goal of getting the laws overturned, according to a report on KQED News. The laws in question set up a seniority system for public schools in the state.
According to the organization's website, Student Matters is "committed to ensuring that all of California’s children receive a quality education." It is run by David F. Welch, an executive at a Silicon Valley fiber-optic communications firm.
Josh Pechtalt, president of the California Federation of Teachers, said in a statement that the lawsuit is "misguided," and that the real problems of public education stem not from teachers, but from money.
"The real problems of public education really are not about teachers having due process rights," he said, "the problems have to do with massive cuts to the classroom, and frankly defunding of public schools now for a number of years."
You can read the full story on KQED's website.
State Senator Convicted Of Stealing From Nonprofit
May 15th
Former N.Y. State Senator Pedro Espada was convicted yesterday of stealing more than $500,000 from the nonprofit health network that he founded. He faces up to 10 years in prison on four counts of theft.
Espada, 58, was convicted after 11 days of deliberation, according to a report in Newsday. He has often been described as the poster child of corruption in Albany by good government groups, serving as a major power broker as the former Senate majority leader in New York.
Espada is convicted of using the funds from Bronx-based Soundview for personal expenses, such as personal meals, home improvements, and vacations from 2005 to 2008. His son, Pedro Gautier Espada, was also charged. They used a for-profit janitorial company to siphon money from the organization.
Deliberations for the case took longer than expected. Jurors deadlocked on all counts against Pedro Gautier, as well as one theft charge and three conspiracy charges against Espada. Two jurors speaking outside the court said the panel was divided 9-3 for two weeks. Holdouts were apparently worried about an anti-Espada agenda. They were eventually convinced after further review of the evidence.
The case against Espada was first brought to light by now Gov. Andrew Cuomo when he was still serving as attorney general. He said in a statement that the state was working to ensure that patients at Soundview would receive proper care despite the loss of funds.
You can read the full story in Newsday.
Espada, 58, was convicted after 11 days of deliberation, according to a report in Newsday. He has often been described as the poster child of corruption in Albany by good government groups, serving as a major power broker as the former Senate majority leader in New York.
Espada is convicted of using the funds from Bronx-based Soundview for personal expenses, such as personal meals, home improvements, and vacations from 2005 to 2008. His son, Pedro Gautier Espada, was also charged. They used a for-profit janitorial company to siphon money from the organization.
Deliberations for the case took longer than expected. Jurors deadlocked on all counts against Pedro Gautier, as well as one theft charge and three conspiracy charges against Espada. Two jurors speaking outside the court said the panel was divided 9-3 for two weeks. Holdouts were apparently worried about an anti-Espada agenda. They were eventually convinced after further review of the evidence.
The case against Espada was first brought to light by now Gov. Andrew Cuomo when he was still serving as attorney general. He said in a statement that the state was working to ensure that patients at Soundview would receive proper care despite the loss of funds.
You can read the full story in Newsday.
Study: D.C. Nonprofits Could See Better Days This Year
May 14th
Washington, D.C.-area nonprofits, which received fewer dollars in 2011, are bracing for better times this year, according to a new study by the Center for Nonprofit Advancement (CNA).
The study, as reported on by The Washington Post, showed that nearly half of the organizations surveyed report that their donors plan to maintain or increase contributions in 2012. This is in contrast to only 27 percent last year, and 15 percent in 2009. The CNA study canvassed nonprofits in D.C., Northern Virginia, and Montgomery and Prince George's counties in Maryland.
Another huge problem for D.C.-area organizations in 2011 was the amount of "rainy-day" reserves they had to use up as a result of the declined contributions. This practice appears to be fading in 2012, ad the CNA study found that the number of nonprofits dipping into reserves fell from 46 percent to 31 percent. In addition, organizations reporting a decline in revenue dropped from 48 percent to 40 percent.
Glen O'Glvie, CNA's chief executive, told The Washington Post that the reason for this comeback in giving appears to come from individual donors. He noted that it's much easier for one person to donate than for foundations and corporations. This notion appears to be validated because, as was reported in The NonProfit Times, corporate philanthropy is experiencing a sharp decline, according to a new study from the Council on Foundations.
Although the decline in donations seems to be slowing, CNA warns that it's not enough to quell the increasing demand for nonprofit services. 53 percent of respondents reported a higher demand for their services last year as a direct result of the economic downturn.
You can read the full story in The Washington Post.
The study, as reported on by The Washington Post, showed that nearly half of the organizations surveyed report that their donors plan to maintain or increase contributions in 2012. This is in contrast to only 27 percent last year, and 15 percent in 2009. The CNA study canvassed nonprofits in D.C., Northern Virginia, and Montgomery and Prince George's counties in Maryland.
Another huge problem for D.C.-area organizations in 2011 was the amount of "rainy-day" reserves they had to use up as a result of the declined contributions. This practice appears to be fading in 2012, ad the CNA study found that the number of nonprofits dipping into reserves fell from 46 percent to 31 percent. In addition, organizations reporting a decline in revenue dropped from 48 percent to 40 percent.
Glen O'Glvie, CNA's chief executive, told The Washington Post that the reason for this comeback in giving appears to come from individual donors. He noted that it's much easier for one person to donate than for foundations and corporations. This notion appears to be validated because, as was reported in The NonProfit Times, corporate philanthropy is experiencing a sharp decline, according to a new study from the Council on Foundations.
Although the decline in donations seems to be slowing, CNA warns that it's not enough to quell the increasing demand for nonprofit services. 53 percent of respondents reported a higher demand for their services last year as a direct result of the economic downturn.
You can read the full story in The Washington Post.
Nonprofit Director Pleads Guilty
May 11th
The head of a Washington, D.C.-based nonprofit pleaded guilty to lying about her 2009 tax returns and is cooperating with prosecutors in their investigation of former D.C. councilman Harry Thomas Jr.
Danita Doleman, who is the executive director of Youth Tech, received $110,000 from the D.C. Children & Youth Investment Trust in 2009, according to a report in The Washington Post. Doleman admitted to funneling $100,000 of that money, which was supposed to be used for drug prevention programs, to the D.C. Young Democrats.
Ayawana Chase Webster, a staffer for Thomas Jr. and head of the D.C. Young Democrats in 2009, used the money from Youth Tech to fund a ball at the John A. Wilson Building. Thomas Jr., who was sentenced to 38 months in prison last week for theft of public funds from the trust, admitted to steering the $100,000 to the ball.
The executive director of the D.C. Youth Investment Trust at the time, Millicent D. West, told prosecutors that she worked with Thomas Jr. and his staff to find a way to pay for the ball. She told them that a non-political group would have to pay for it. That's where Youth Tech came into play.
Doleman's role in the scandal had not been mentioned in the original court documents. A two-page charge filed Wednesday accused her of failing to report $20,000 in income she received from Youth Tech in 2009. Her lawyer, Michelle Peterson, said her client filed an amendment to reflect the $4,000 she owed in taxes and, as part of her plea agreement, would provide information for the government's investigation of Thomas Jr.
You can read the full story in The Washington Post.
Danita Doleman, who is the executive director of Youth Tech, received $110,000 from the D.C. Children & Youth Investment Trust in 2009, according to a report in The Washington Post. Doleman admitted to funneling $100,000 of that money, which was supposed to be used for drug prevention programs, to the D.C. Young Democrats.
Ayawana Chase Webster, a staffer for Thomas Jr. and head of the D.C. Young Democrats in 2009, used the money from Youth Tech to fund a ball at the John A. Wilson Building. Thomas Jr., who was sentenced to 38 months in prison last week for theft of public funds from the trust, admitted to steering the $100,000 to the ball.
The executive director of the D.C. Youth Investment Trust at the time, Millicent D. West, told prosecutors that she worked with Thomas Jr. and his staff to find a way to pay for the ball. She told them that a non-political group would have to pay for it. That's where Youth Tech came into play.
Doleman's role in the scandal had not been mentioned in the original court documents. A two-page charge filed Wednesday accused her of failing to report $20,000 in income she received from Youth Tech in 2009. Her lawyer, Michelle Peterson, said her client filed an amendment to reflect the $4,000 she owed in taxes and, as part of her plea agreement, would provide information for the government's investigation of Thomas Jr.
You can read the full story in The Washington Post.
Senate Campaign Finance Bill Would Target Nonprofits
May 9th
The New Hampshire State Senate is preparing to vote today on a bill that would require nonprofits and other groups to report the money they spend on state and national political races.
Nonprofits have long been under the microscope of the Internal Revenue Service (IRS) for contributions or statements made during campaign season but, as was reported by The Union Leader, Senate bill HB 1704 would expand the definition of a political committee to include tax-exempt organizations, specifically 501(c)(4)s, 501(c)(5)s, and 501(c)(6)s. These include social advocacy groups, labor unions, and business associations.
In the wake of the Supreme Court decision Citizen v. United, there has been a lot of concern about anonymous donors using 501(c)(4)s as a means to funnel huge contributions to what are known as Super Political Action Committees (PACs). Still, both liberal and conservative groups have expressed displeasure with the current bill.
New Hampshire ACLU Executive Director Claire Ebel told The Union Leader that she was particularly concerned about a section of the bill that requires disclosure when a group pays for “distribution of information critical of a member of the general court who has not filed for office.” Ebel believes this is in direct violation of the First Amendment. The Josiah Bartlett Center for Public Policy, a conservative organization based in Concord, N.H., also has issues with this section of the bill.
HB 1704 is being promoted by Concord-based Coalition for Open Democracy, whose program director, Olivia Zink, denied the bill would squash free speech. She said the bill was based on similar legislation that was passed in Maine that was upheld by the First Circuit Court of Appeals.
You can read the full story in The Union Leader.
Nonprofits have long been under the microscope of the Internal Revenue Service (IRS) for contributions or statements made during campaign season but, as was reported by The Union Leader, Senate bill HB 1704 would expand the definition of a political committee to include tax-exempt organizations, specifically 501(c)(4)s, 501(c)(5)s, and 501(c)(6)s. These include social advocacy groups, labor unions, and business associations.
In the wake of the Supreme Court decision Citizen v. United, there has been a lot of concern about anonymous donors using 501(c)(4)s as a means to funnel huge contributions to what are known as Super Political Action Committees (PACs). Still, both liberal and conservative groups have expressed displeasure with the current bill.
New Hampshire ACLU Executive Director Claire Ebel told The Union Leader that she was particularly concerned about a section of the bill that requires disclosure when a group pays for “distribution of information critical of a member of the general court who has not filed for office.” Ebel believes this is in direct violation of the First Amendment. The Josiah Bartlett Center for Public Policy, a conservative organization based in Concord, N.H., also has issues with this section of the bill.
HB 1704 is being promoted by Concord-based Coalition for Open Democracy, whose program director, Olivia Zink, denied the bill would squash free speech. She said the bill was based on similar legislation that was passed in Maine that was upheld by the First Circuit Court of Appeals.
You can read the full story in The Union Leader.
Maurice Sendak’s Legacy Of Philanthropy
May 8th
Well known author and illustrator Maurice Sendak passed away today at the age of 83 after suffering a stroke. While Sendak was best known for books such as "Where the Wild Things Are," he also leaves behind a legacy of philanthropy.
The Huffington Post reported today that Sendak was quietly involved in a number of philanthropic causes. In 2010, he gave $1 million to the Jewish Board of Family and Children's Services, a New York City based agency that provides services to needy families in the state. Sendak decided to make the gift in honor of his partner, Eugene D. Glynn, who died in 2007 after working for the organization as a psychiatrist for 30 years. Sendak told The Wall Street Journal at the time that he was contributing to a cause that Eugene would have wanted to do.
Sendak's donations didn't always come in the form of money. Since the 1960s, he had been donating his books and illustrations to Philadelphia's Rosenbach Museum of Library. Sendak served on the museum's board of directors.
You can read the full story in The Huffington Post.
The Huffington Post reported today that Sendak was quietly involved in a number of philanthropic causes. In 2010, he gave $1 million to the Jewish Board of Family and Children's Services, a New York City based agency that provides services to needy families in the state. Sendak decided to make the gift in honor of his partner, Eugene D. Glynn, who died in 2007 after working for the organization as a psychiatrist for 30 years. Sendak told The Wall Street Journal at the time that he was contributing to a cause that Eugene would have wanted to do.
Sendak's donations didn't always come in the form of money. Since the 1960s, he had been donating his books and illustrations to Philadelphia's Rosenbach Museum of Library. Sendak served on the museum's board of directors.
You can read the full story in The Huffington Post.
Michigan School District Lost Thousands To Fake Nonprofit
May 8th
Newly unsealed federal court records show that the Highland Park, Mich. school district lost $170,000 to a fake nonprofit set up by a now indicted school board member.
The Detroit Free Press reported today on the records, which provide a deeper look at the government's case against Robert Davis, 32, who is charged with stealing from the already cash-strapped school district. Davis used money from the phony nonprofit, called Citizens United to Save Highland Park Schools, on personal expenditures. Records show he allegedly spent $84,000 on perks such as custom-made clothes, hotel rooms, bar and restaurant tabs, and spending sprees at malls. He is also accused of withdrawing $86,711 in cash from the organization.
Citizens United was set up in 2005 by Davis, who used his home as the address for the fake nonprofit. According to an FBI search warrant affidavit filed in the U.S. District Court in Detroit, Davis was listed as the sole signatory for the organization's account. Highland Park school officials reportedly had no idea the account existed.
Davis was indicted on April 5 on charges that he stole more than $125,000 from the school district by submitting false invoices for advertising between 2004 and 2010. He faces up to 10 years in jail if he is convicted.
You can read the full story in The Detroit Free Press.
The Detroit Free Press reported today on the records, which provide a deeper look at the government's case against Robert Davis, 32, who is charged with stealing from the already cash-strapped school district. Davis used money from the phony nonprofit, called Citizens United to Save Highland Park Schools, on personal expenditures. Records show he allegedly spent $84,000 on perks such as custom-made clothes, hotel rooms, bar and restaurant tabs, and spending sprees at malls. He is also accused of withdrawing $86,711 in cash from the organization.
Citizens United was set up in 2005 by Davis, who used his home as the address for the fake nonprofit. According to an FBI search warrant affidavit filed in the U.S. District Court in Detroit, Davis was listed as the sole signatory for the organization's account. Highland Park school officials reportedly had no idea the account existed.
Davis was indicted on April 5 on charges that he stole more than $125,000 from the school district by submitting false invoices for advertising between 2004 and 2010. He faces up to 10 years in jail if he is convicted.
You can read the full story in The Detroit Free Press.
National Museum Of Natural History Gets Major Donation
May 7th
David H. Koch, executive vice president of Koch Industries, has made his mark on National Museum of Natural History by donating $35 million to the Washington, D.C.-based museum.
The major gift, which was announced by the Smithsonian Institute last Thursday, will be used to build a new dinosaur hall, according to a report in The Washington Post. It is the largest single donation the museum has ever received, and the fifth largest in Smithsonian history.
Koch, who might be best known for his support of conservative causes, has been a member of the museum's advisory board for the past 15 years. He told The Post that he made the donation because he believes the institution's current dinosaur hall is "obsolete." Many of the specimens included in the current dinosaur exhibit have been there since the museum first opened 100 years ago.
This is certainly not Koch's first experience with philanthropy related to dinosaur exhibits. He donated $20 million to the dinosaur hall in New York City's American Museum of Natural History in 2006. He also gave $100 million to the renovation project for the State Theater of New York at Lincoln Center.
The National Museum of Natural History's current dinosaur exhibit will close in 2014, with the renovated hall scheduled for completion in 2019. The total cost of the work is estimated at $45 million.
You can read more about this story in The Washington Post.
The major gift, which was announced by the Smithsonian Institute last Thursday, will be used to build a new dinosaur hall, according to a report in The Washington Post. It is the largest single donation the museum has ever received, and the fifth largest in Smithsonian history.
Koch, who might be best known for his support of conservative causes, has been a member of the museum's advisory board for the past 15 years. He told The Post that he made the donation because he believes the institution's current dinosaur hall is "obsolete." Many of the specimens included in the current dinosaur exhibit have been there since the museum first opened 100 years ago.
This is certainly not Koch's first experience with philanthropy related to dinosaur exhibits. He donated $20 million to the dinosaur hall in New York City's American Museum of Natural History in 2006. He also gave $100 million to the renovation project for the State Theater of New York at Lincoln Center.
The National Museum of Natural History's current dinosaur exhibit will close in 2014, with the renovated hall scheduled for completion in 2019. The total cost of the work is estimated at $45 million.
You can read more about this story in The Washington Post.
NY Attorney General Sues Race Horse Nonprofit
May 4th
New York Attorney General Eric Schneiderman announced yesterday that he has filed a lawsuit against the directors of a nonprofit for retired race horses.
The Rochester Democrat and Chronicle reported that Schneiderman accused the Saratoga Springs, N.Y.-based Thoroughbred Retirement Foundation (TRF) of providing inadequate care for its 1,100 retired race horses. The suit alleges the organization took on more horses than it could handle, leading to poor food, unattended injuries, and a lack of shelter for severe weather.
In a statement, Schneiderman said that both the state and the nation need TRF to succeed but that the group's "board has driven this vital organization into the ground." The foundation is also accused of paying its boarding farms less than $3 per horse a day to provide care -- less than half spent by similar organizations -- and that the board diverted funds for horses to repay loans by two of the organization's directors.
TRF Chairman John Moore has denied the allegations, saying that suit is based on a "pile of lies." He insisted that all of the horses they care for are in good condition, and that TRF would pursue every legal avenue to defend itself.
You can read the full story in The Rochester Democrat and Chronicle.
The Rochester Democrat and Chronicle reported that Schneiderman accused the Saratoga Springs, N.Y.-based Thoroughbred Retirement Foundation (TRF) of providing inadequate care for its 1,100 retired race horses. The suit alleges the organization took on more horses than it could handle, leading to poor food, unattended injuries, and a lack of shelter for severe weather.
In a statement, Schneiderman said that both the state and the nation need TRF to succeed but that the group's "board has driven this vital organization into the ground." The foundation is also accused of paying its boarding farms less than $3 per horse a day to provide care -- less than half spent by similar organizations -- and that the board diverted funds for horses to repay loans by two of the organization's directors.
TRF Chairman John Moore has denied the allegations, saying that suit is based on a "pile of lies." He insisted that all of the horses they care for are in good condition, and that TRF would pursue every legal avenue to defend itself.
You can read the full story in The Rochester Democrat and Chronicle.
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