November 2007 Archives
Via Gift Hub, a report of a Chilean prostitute auctioning 27 hours of sex for a charity fundraising event. In Chile, according to the article, prostitution is legal.
Readers may recall the story from Brooklyn involving strippers who volunteered to help distribute candy at a charity event, only to be banned by the organizers. The response of the organizer of the Chilean campaign--Sabado Gigante star Don Francisco:
Speaking about Maria Carolina's unusual donation, campaign organizer Mario Kreutzberger said he would not encourage "immoral" activities, but said he would accept her pledge."Everyone can do what they want, but if someone tells me that they'll do something immoral ... I'm not going to encourage it," Kreutzberger, who as "Don Francisco" hosts the long-running "Sabado Gigante" program on the U.S. Spanish-language Univision network, told local media.
The prostitute herself raises an interesting defense:
"There are people who are going to be donating money that's a lot more questionable than mine," she said. "The only thing I did was publicize it."
If you're using video to promote your enterprise, it never hurts to feature a celebrity model--or a bizarro celebrity!
For more info on Gelila's cause, check out Charity: Water
If you don't get the reference in the "bizarro" link, watch the original version on which the Dr. Pepper parody is based. What's so fascinating for me about artist Tay Zonday's trajectory is the speed with which social consciousness metamorphosed into viral comedy and now ironic marketing. Used to be that sort of thing took thirty years!
Another excellent question I've received: If a person donates property to a charity, how much can they deduct? The scenario that sparked the ask: an artist donating her art to a church for it to sell. She can deduct the price the art sells for, right?
Wrong!
Artists can only deduct the cost of the items used to create art of their own that they've donated--and if they deducted those items as a business expense, they can't deduct 'em again as a charitable deduction! The same thing goes for donations of personal papers. You also can't deduct the value of your time--for example, I could not deduct the value of free legal consultation to a charity, nor could a carpenter deduct the value of time spent helping to build a house with Habitat for Humanity.
But what about gifts of property more generally? Let's say the church member donated someone else's painting or some jewelry or stock?
Charitable business has been in the news quite a bit, and once again the fact that charities don't pay taxes on much of that business is attracting a fair bit of negative attention, especially from commercial competitors. We can expect the complaints to grow louder as the economy gets worse.
I've been asked to provide a brief overview of UBIT. Since it was just my dumb luck to get sick I've decided to set aside the podcast format for a day or two and set the answer out in writing.
Click below for more:
Don't murder a popular newspaper editor, even if he did dare to investigate your finances.
That, at least, is the backstory of this article about an AIDS charity leading the bidding for a bankrupt social enterprise in Oakland.
Transparency is one of the watchwords of corporate ethics in the charitable community. The assumption is the more we know, the less we allow bad things to thrive--"sunlight is the universal disinfectant" and all that.
Yet as we've seen time and time again, transparency only works if people understand what they see. Enron provides a telling example: their instability was laid out for all to see in their quarterly reports . . . if you had the expertise and patience to parse through the details.
The same is true when it comes to nonprofit tech. Convio, a firm that provides nonprofit donation management services, is getting hit for their handling of a security breach in which someone obtained its clients passwords, email addresses and other personal information. But as Allen Benamer observes in his Nonprofit Tech Blog--which, as the New York Times indicates, has become a hub of information and insight re l' affaire Convio--the potential for exposure to a security breach was in plain sight all along.
The telltale part: the ability to retrieve your password. Key passages below:
What is distressing is a defense of Convio by a marketer on the progressive exchange e-mail list who is claiming “that GA was using… state of the art anti-hacking tactics.” We really don’t know that yet and unencrypted passwords are truly NOT state of the art anti-hacking tactics. . . . And those of you who have survived this breach with not having to contact constituents, should immediately rescind the “privilege” of e-mailing members with their old passwords if they forget them and just create a random new password for them to login with instead.
Basically, in order to make sure that single sign-on was possible, GetActive gave users the ability to dump unencrypted passwords en masse from the system so that a nonprofit’s GetActive users could be synched with a “foreign” system. . . .The idea that there are text files out there with my username and unencrypted password on them is really annoying. This practice has to end now for all vendors selling nonprofit solutions.
My fellow nerds, geeks, and accidental techies, please be sure to tell your not-so-technical co-workers that they can no longer expect to be e-mailed their old passwords just because it’s more convenient. It was always bad practice and in a case where sometimes we can pressure vendors to accoomodate us, it was a doubly bad idea.
Just got off the phone with a reporter re the fusion of for-profits and charity. Here's one in Nolita, via Gothamist and Page Six:
CALVIN Klein is destroying his own ad in the name of art. To help promote the Dec. 1 opening of the New Museum on the Bowery, Klein allowed the institution's advertisers to drip oozing pink paint over his Houston Street billboard of Lara Stone and Jamie Burke wearing his jeans. The label, along with Julianne Moore andMaggie Gyllenhaal, will host an intimate soiree tonight at the museum, and the hot pink ooze will drip down the billboard until Monday.
One thing that gets me every time I'm asked about this sort of thing is the assumption that this sort of thing is new, that it never happened before. Nahhhh. Five hundred years ago, a wealthy merchant would pay for vestments, sponsor religious artwork and get himself (or his mistress!) drawn into the pictures. Now it's a museum integrated with two half-dressed people pretending to make out, but those are just incidental details.
And it's not as if the religious wasn't replete with naughty bits.
Class meetings today, so no podcast. Tomorrow's will cover the topic in the title of this post. Until then, by special request, here are the core documents.
IRS on the 2006 tax law changes (general & donations)
Form 8282: Donee information return
A few years ago the Smithsonian honored Martha Stewart in an exhibit.
Here's more about the history of the Smithsonian's business ventures, including its controversial deal with Showtime.
(My opinion about the Showtime-Smithsonian venture? I'd be all for it if it meant that Dexter could travel through time!)
The Wall Street Journal today has an op-ed criticizing Nancy Pelosi's attempt to spike a proposal to make employers immune from federal civil-rights lawsuits for requiring workers to speak English.
What prompted this proposed amendment?
The EEOC's lawsuit against the Salvation Army, which fired two clothes-sorters for failing to adhere its English-only policy.
Now some of you might wonder, aren't charities already supposed to be free from lawsuits under the doctrine of charitable immunity?
Short answer: Not this kind of lawsuit, and more generally, not as much as you think.
Charitable immunity is a state-law doctrine--it has no bearing on an organization's liability under federal law, including federal anti-discrimination law.
Beyond that, charitable liability is not an absolute absolution from all liability. Generally, charities in states that recognize charitable immunity protect charities from liability due to the negligence of their employees. (The level of protection does vary; some states grant total immunity; others merely limit it.)
Note that I said "charities in states that recognize charitable immunity." Not all states do, and last I knew, New York was one of the exceptions.
Sorry, kids.
Why would a state not choose to recognize charitable immunity? Historically, attempts to limit or eliminate the doctrine have followed some egregious incident of perceived wrongdoing, such as medical malpractice or, more recently, the sex scandal in the Catholic Church.
Although charitable immunity is not a federal law, Congress has extended limited protection to volunteers under the Volunteer Protection Act of 1997. Click here for a brief overview of its main provisions.
IRS model articles of incorporation
Delaware Certificate of Incorporation: A Non-Stock Corporation
New York model not-for-profit certificate of incorporation
Forming a Not-for-Profit Corporation in New York State
From the LA Times, via Defamer:
Even tweens are hip to the importance of altruism. Last month, Variety launched a nonprofit initiative to highlight junior Hollywood's philanthropy and sponsored a Power of Youth event that drew [Dakota] Fanning, Miley Cyrus and Raven Symone.
"In Hollywood, there are bright, young kids who understand social issues like global warming," [Howard Bragman, founder of Fifteen Minutes PR, a Los Angeles public-relations firm that specializes in crisis management] says. "In Washington, there's a 60-year-old guy making fun of it.""It's such an exciting time for youth culture," says [Scarlett] Johansson, who plans to take a trip with Oxfam every year. "I don't think we've seen such a surge in interest about what is happening in the world since the '60s."
As for [Paris] Hilton, there has been no word whether her jaunt to Rwanda will ever happen. The outing was originally planned by Playing for Good, a new charity organization geared to celebrities. Hilton's debut as a humanitarian was to be fodder for a new reality show called "The Philanthropist." Think "The Simple Life" meets "Ghandi."
"We're restructuring the organization, but we hope to reschedule Paris' trip for next year," says Maria Bravo, co-founder of Playing for Good. "I don't think she will stop going to clubs. But hopefully, she can combine doing good with fun and not drinking and driving."
Still, while it's easy to poke fun, strategic altruism is indeed both good PR and a way for the emerging generation of celebrities to find meaning in a life that can seem unreal.
This week in my nonprofit law class: a look at the not-so-wonderful world of UBIT, the unrelated business income tax.
And just in time for it: a nifty New Yorker survey of the contents of NYC museum gift shops. The article: "Art and Commerce," by Patricia Marx. It's not online yet & it has, well, pretty much nothing in the way of legal analysis, but once you grasp the basics of UBIT the stuff in the article makes a lot more sense.
I can always count on a laugh in my lectures when I note that toilets are a real growth opportunity for entrepreneurs.
No, not icky germy growth, but that's part of the reason why waste disposal is so valuable--and a major reason it shouldn't be ignored by folks who self-identify as social entrepreneurs.
Evidence of the emerging sanitation, um, movement: the first conference of the World Toilet Association, a nonprofit trade group "hoping to spark a sanitation revolution that will save lives through better hygiene and break taboos about what happens behind closed bathroom doors."
Dr. Shigeru Omi, western Pacific director of the World Health Organization, said 1.8 million people die annually due to diseases related to inadequate sanitation, 90 percent of them children younger than 5.
Providing healthy bathroom facilities worldwide would cost some $10 billion a year -- equal to 1 percent of world military spending or what Europeans annually spend on ice cream, he said. The new association aims to provide toilet facilities to impoverished countries, provide for urgent sanitation needs after natural disasters and spread information and technology for improving toilets.
The South Korean government has given strong backing to the World Toilet Association, which has been spearheaded by the country's "Mr. Toilet" -- parliament member Sim Jae-duck. He earned his nickname for improving public restrooms for the 2002 World Cup as mayor of Suwon city.
"The restroom revolution will provide hope and happiness to mankind," Sim told delegates.
Another reason why toilet tech is sure to boom: current mainstream waste disposal and processing techniques are incredibly inefficient. Forget about your carbon footprint--if you want to be truly green, you need to know your pee-print:
The problem with urine is that it is the main source of some of the chemical nutrients that have to be removed in sewage treatment plants if they are not to wreck ecosystems downstream. Despite making up only 1 per cent of the volume of waste water, urine contributes about 80 per cent of the nitrogen and 45 per cent of all the phosphate. Peeing into the pan immediately dilutes these chemicals with vast quantities of water, making the removal process unnecessarily inefficient.
To be fair, if you use conventional western plumbing there's not an awful lot you can do about your personal pee-print right now. A lucky few, however, live or work in one of the buildings in continental Europe where you can find a future must-have eco-accessory: the urine separation toilet. These devices divert urine away from the main sewage stream, allowing the nutrients to be recycled rather than treated as waste. They could solve all the environmental problems associated with urine and even turn sewage plants into net producers of green, clean energy.
If you insist on giving green, at least make it fun.
F'r instance, here's something that would make a cool gift for teen kids of surburbanite friends: the Eco-Terrorist tee from Ban T-shirts.
The New York Times Style Section has a fun article today on "the new Grinch"--the family member who insists on giving green.
Not green as in money, of course, but eco-friendly. In short, "[t]his Grinch . . . is not out to spoil Christmas, but merely to use it as a platform to advocate ecological responsibility."
One way to look at the issue appears in the musings of the Grinches in question: namely, we are in a transitional period from older materialism to sustainable gift-giving, a cultural moment that may require a bit of sensitivity and compromise.
Or perhaps something else is at play.
Could it be that the sustainability movement serves less to save the earth than to promote the superior virtue of its proponents?
The social enterprise movement is primarily a secular phenomenon, at least in its prototypical rhetoric and associative networks. But like so much of modern charity, hybridizing business and public benefit is a practice that has deep religious roots as well as parallel religious tracks.
Example #1: BAM, the Business As Mission movement. This has close parallels with the wing of the social enterprise movement that is trying to infuse profit-seeking business with charitable values, whether through cause-marketing, corporate social responsibility, a socially beneficial purpose or the dedication of profits to a charitable cause. Does any of this sound familiar?
The phenomenon has many labels: "kingdom business," "kingdom companies," "for-profit missions," "marketplace missions," and "Great Commission companies," to name a few. But observers agree the movement is already huge and growing quickly. BAM "is the big trend now, and everyone wants to say they're doing it," says Steve Rundle, associate professor of economics at Biola University. Rundle authored Great Commission Companies (2003) and has an upcoming book, An Overview of Business as Mission, written with fellow BAM scholar Neal Johnson.
The BAM model affirms that business is a Christian calling; that free-market profit is rooted in the cultural mandate; and that rightly done, "kingdom businesses" offer economic, social, and spiritual help to employees, customers, and nations. Big start-ups are often financed by wealthy Christians who expect financial rewards and ministry results. Small start-ups, called microenterprises, use small loans to achieve more modest ministry and profit goals. Some efforts, like Yeager Kenya Group, Inc., fall somewhere in between.
Example #2: Entrepreneurial megachurches
An analysis by The New York Times of the online public records of just over 1,300 of these giant churches shows that their business interests are as varied as basketball schools, aviation subsidiaries, investment partnerships and a limousine service.
Indeed, some huge churches, already politically influential, are becoming catalysts for local economic development, challenging a conventional view that churches drain a town financially by generating lower-paid jobs, taking land off the property-tax rolls and increasing traffic.
But the entrepreneurial activities of churches pose questions for their communities that do not arise with secular development.
These enterprises, whose sponsoring churches benefit from a variety of tax breaks and regulatory exemptions given to religious organizations in this country, sometimes provoke complaints from for-profit businesses with which they compete . . . .
Crunchgear raises an intriguing question about online charity and privacy:
In discussing several things with my brother this Thanksgiving weekend . . . he brought up something Facebook-releated. See, he doesn’t join groups promoting a cause (”FreeRice,” for example) because he doesn’t want to be seen leaving the group later on, privacy settings@ notwithstanding.
What, you don’t support feeding starving people anymore, you jerk?
@It’s a social phenomenon. How do you show your support for a cause on Facebook without later being seen retracting your support? @It’s something I think needs addressing, along with the pocket veto, a term I coined some time ago describing friend/group/whatever rejection without rejection.
Margaret Thatcher?
Anyway, the post below was a lot of words, so I thought a fun pic was in order.
Click through for notes identifying each face.
Are all charitable organizations considered NGO's by definition?
That's an excellent question, not least of all because of its final two words. Precise definition is one of the keys to law--when Bill Clinton said "it depends what the meaning of 'is' is" he may have seemed too clever by half, but he was talking like the lawyer he is.
Whatever that may mean.
Anyway, back to the question. The answer depends on how we define our terms.
In this instance, all charities are NGOS, since 501(c)(3) does not encompass the federal government, states or their political subdivisions. Why doesn't 501(c)(3) apply to governments? In a nutshell, commentators point to three reasons:
- Our constitutional structure does not allow states to be taxed.
- The tax code does not define the scope of taxable entities to include sovereign political entities.
- A government's power to tax, power of eminent domain and police power go beyond the purposes specified in 501(c)(3).
That may seem to be a clear enough answer, but the devil's in the details. Although 501(c)(3) does not encompass governmental units, there are nonetheless a bunch of separately organized governmental organizations that can qualify as tax-exempt under 501(c)(3). A few common examples (assuming they're organized the right way) include public libraries, public hospitals and state universities.
In fact, one of the country's largest charities--the American Red Cross--is chartered by an Act of Congress and also recognized as exempt under 501(c)(3). It is what some would call a GONGO, or government organized nongovernmental organization.
Which leads to another answer to our main question. There are a number of folks who see governmental involvement to be inherently contradictory to being an authentic nongovernmental organization. From their perspective, an organization created by or working for the government is not an NGO, at least not in the sense of being a voluntary organization formed outside the sovereign political structure. That means a charity could be exempt under 501(c)(3)--or, more globally, be a nonprofit serving a public purpose--and yet not fit their definition of what constitutes an NGO.
What's the right answer?
I don't think there is one. Terms such as nonprofit, charity and NGO are inherently contingent--their particular meaning depends on their immediate context.
Case in point: the very fact that American corporate law tends to use the term "nonprofit" or "not-for-profit" while NGO prevails in the context of international associations and public interest work is itself a historical accident. "Nonprofit" form reflects its origins in a reaction against industrial-age commerce and the accumulation of capital, while the term "NGO" reflects a twentieth-century reaction against provincial nationalism and authoritarian political sovereignty.
So here's your takeaway:
Is every charity by definition an NGO?
It depends what the meaning of "is" is!
BONUS RESOURCE: For more information on this topic, hearty souls may want to consider the helpful summary provided by Jody Blazek and David Nelson in the September 2006 Exempt Organization Tax Review: "When Can a Governmental Organization Qualify as a 501(c)(3) Organization and What is the Tax Reporting Consequence?"
A look at how a sense of virtue can blind people to vice. But funnier than the way I say it.
It takes a lot to leave me speechless.
At halftime of the Jets’ home game against the Pittsburgh Steelers on Sunday, several hundred men lined one of Giants Stadium’s two pedestrian ramps at Gate D. Three deep in some areas, they whistled and jumped up and down. Then they began an obscenity-laced chant, demanding that the few women in the gathering expose their breasts.
Youtube has several decidedly NSFW videos of what is apparently a Jets halftime tradition: intimidating women into exposing themselves. The men surround a target, shout at her and throw things if she refuses to oblige.
Security says that stopping this would violate the thugs' free speech rights.
Security is wrong. The First Amendment does not protect assault. If the Jets' management does not shut this down at the next home game, they deserve the lawsuits that are sure to come now that this has hit the Times.
Whenever I tell folks in the social enterprise that I think the time may be turning against their hybrid model of charity, the reaction is typically disbelief.
This year, for instance, the U.S. Treasury will be receiving about $40 billion less than it would if the tax code didn't allow for charitable deductions. (That's about the same amount the government now spends on Temporary Assistance for Needy Families, which is what remains of welfare.) Like all tax deductions, this gap has to be filled by other tax revenues or by spending cuts, or else it just adds to the deficit.
I see why a contribution to, say, the Salvation Army should be eligible for a charitable deduction. It helps the poor. But why, exactly, should a contribution to the already extraordinarily wealthy Guggenheim Museum or to Harvard University (which already has an endowment of more than $30 billion)?
(from Is Theater Really a Charity? by Robert Reich)
Worth noting: Reich's emphasis on wealth and quid-pro-quo exchange versus the traditional understanding of charity as poor relief. Reich's op-ed points to where public policy is likely to shift, particularly if there's a recession.
Or "Dahran," as it's called in the latest issue, which has Thor's alter ego, Dr. Don Blake, working there on a humanitarian mission with Medicins san Frontieres. The story makes a point that any number of us in the do-gooder community would do well to learn: while outside assistance can be useful, for change to be sustainable it must come from within.
In our web design class last Wednesday, we talked, among other things, about customer relationship management and Salesforce. Below: a Salesforce intro from Wallstrip, parodying Glengarry Glen Ross.