Friday, August 16, 2013

Nonprofit Coalition Disagrees with Commission

Yesterday we blogged about the recently-released report from the Commission on Accountability and Policy for Religious Organizations which recommended that clergy should be able to say whatever they believe is appropriate in the context of their religious services or other regular religious activities even when that includes content related to political candidates.  Under the Commission's new world order, such communication would be permissible as long as the organization’s cost would be the same with or without it.   The NonProfitTimes and the Chronicle of Philanthropy are today both reporting that Independent Sector, a leading coalition for nonprofits, has strongly criticized the Commision's recommendations.

“This is a deeply disturbing and troubling option,” said Independent Sector's President & CEO, Diana Aviv. “We think it should not be a possibility,” she said.

According to Aviv, some parts of the report and its recommendations were unclear, while other parts were contradictory and required further reading and study.  She viewed the report and recommendations as having the intent to “drive a truck” through the clear separation of political activity and nonpartisan political activity from other activity.

“While we agree with the commission that there is no clarity in this area, the solution is not to gut everything,” Aviv said. “This actually contaminates our advocacy work.”

The only item in the report that Independent Sector agreed with was that current regulations are vague and require clarity.  According to Aviv, a strong argument exists for reviewing the limits put in place in 1969 and 1976. Current regulations allow charities to interact with public officials on a limited basis, which Aviv said is an appropriate distinction since organizations work to educate officials on issues relevant to their missions and members.

“Speaking out and engaging in advocacy on issues is critical to the ability of nonprofits to achieve their missions. This is an entirely different matter than endorsing candidates or getting involved in political campaigns,” she said.  She sees three necessary solutions to the political speech issue: (1) greater clarify over what is political activity: (2) clearer definition of what “unsubstantial” means for 501(c)(3) organizations; and (3) disclosure of donors to 501(c)(3) organizations if their donations are used for partisan activity.


August 16, 2013 in Church and State, Current Affairs, In the News | Permalink | Comments (0) | TrackBack (0)

Thursday, August 15, 2013

Commission Speaks on Clergy and Free Political Speech

The Commission on Accountability and Policy for Religious Organizations has released its second report in response to a request from Sen. Charles Grassley (R-Iowa) for guidance.  The approximately 60-page report titled  “Government Regulation of Political Speech by Religious and Other 501(c)(3) Organizations: Why the Status Quo Is Untenable and Proposed Solutions” made three primary recommendations: 

  • Clergy should be able to say whatever they believe is appropriate in the context of their religious services or other regular religious activities without fear of reprisal by the Internal Revenue (IRS), even when that communication includes content related to political candidates. The communication would be permissible provided that the organization’s costs would be the same with or without the political communication.
  • Secular nonprofits should have “comparable latitude when engaging in regular, exempt-purpose activities and communications.”
  • Current IRS policy not permitting tax-deductible funds to be disbursed for political purposes should be preserved.

According to Commission Chair Michael Batts, “The law prohibiting political campaign participation and intervention by 501(c)(3) organizations as currently applied and administered lacks clarity, integrity, respect, and consistency.”  He maintains that 501(c)(3) organizations’ leaders “are never quite sure where the lines of demarcation are, and the practical effect of such vagueness is to chill free speech -- often in the context of exercising religion.”  

The report discusses the history of the ban on political campaign participation or intervention, which was included in the Revenue Act of 1954.  It also identifies key cases in which the IRS has examined organizations or their leaders for certain actions, particularly several instances during the 2004 presidential campaign.

The Evangelical Council for Financial Accountability (ECFA) established the commission in response to a January 2011 request by Sen. Grassley to coordinate a national effort to provide input on accountability, tax policy and political expression for nonprofits in general and religious organizations in particular.  The commission is comprised of 14 members and 66 panel members, including legal experts and representatives of religious and nonprofit sector organizations.


August 15, 2013 in Church and State, Current Affairs, In the News, Religion | Permalink | Comments (0) | TrackBack (0)

New National Commander at Salvation Army

The nation's second largest charity, The Salvation Army USA, yesterday announced that Commissioner David Jeffery will serve as the new National Commander of The Salvation Army USA effective November 1.  Jeffrey will succeed William Roberts, who will become the next chief of staff of the International Salvation Army.  Jeffrey's wife, Commissioner Barbara Jeffrey, will become National President of Women’s Ministries, also effective Nov. 1.

The announcements come in the wake of the August 3 election of Andre Cox as the 20th General and world leader of The Salvation Army.  Cox's election set in motion a series of executive turnovers.  Roberts will succeed Cox, who served as chief of staff, the second-highest position within the International Salvation Army, since February. He will begin his new position on October 1.  His wife, Nancy Roberts, will become World Secretary of Women’s Ministries.

The new National Commander is not new to high level service within the Salvation Army.  Since 2011, Commissioner Jeffery served as territorial commander for The Salvation Army Southern territory. Previously, he was National Chief Secretary for the USA National Headquarters in Arlington, Virginia. As National Commander, Jeffery will be chairman of the national board of trustees, responsible for presiding over tri-annual commissioners’ conferences, bringing together executives from the Salvation’s Army’s four U.S. territories.

The 59-year-old Cox shares his ministry with his wife, Commissioner Silvia Cox, who is the World President of Women’s Ministries.  Together, they will lead The Salvation Army’s 1.5 million member churches.

Cox was himself appointed as chief of staff in February. Prior to that, he was a territorial commander in the Southern African Territory, the Finland and Estonia Territory, and the United Kingdom Territory with the Republic of Ireland.  As general, he is the international leader of The Salvation Army, and the only person elected to office within the organization.  He directs operations throughout the world through administrative departments of the international headquarters in London.

All the best to the new team.



August 15, 2013 in Current Affairs, In the News, Religion | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 13, 2013

New Jersey Court: Donor Intent Rules the Day

In a decision handed down last week, the New Jersey Superior Court, Appellate Division, ruled that charities that do not follow donor intent must return the gifts.  In Adler v. Save, ___A.3d___, 2013 WL 4017286, a three-judge panel ruled that a Mercer County animal shelter must return a $50,000 gift originally slated for specialized construction.

In delivering the court's opinion, Judge Jose Fuentes wrote:

We hold that a charity that accepts a gift from a donor, knowing that the donor’s expressed purpose for making the gift was to fund a particular aspect of the charity’s eleemosynary mission, is bound to return the gift when the charity unilaterally decides not to honor the donor’s originally expressed purpose.

The case turned on a gift given by a Princeton couple, Bernard and Jeanne Adler, to animal shelter SAVE (now SAVE, A Friend to Homeless Animals). The gift was to finance the building of an area for larger dogs and older cats, whose adoption prospects are limited, as part of a new facility in Princeton.

Before SAVE began construction, it merged with another animal welfare nonprofit, Friends of Homeless Animals. The new organization developed a new plan to build a shelter in nearby Montgomery Township instead.  The new shelter will be about half the size of what the new Princeton facility would have been.  Although SAVE trustee John Sayer testified that the new shelter would “absolutely” have rooms for large dogs and older cats, the court said that evidence suggested otherwise.  Judge Fuentes wrote:

Based on Mr. Sayer’s testimony and the letter announcing the merger between SAVE and Friends of Homeless Animals, we are satisfied that the 15,000 square foot shelter to be constructed in Montgomery Township does not include two rooms specifically designated for the long-term care of large dogs and older cats.

The Adlers filed suit in Mercer County in 2007, seeking the return of their $50,000 donation to SAVE.  By order dated August 26, 2010, the court held in the Adlers' favor, finding that they were entitled to the full return of their charitable gift.  SAVE appealed, arguing that the judge erred in determining that the Adlers’ gift was restricted.  SAVE also argued that even if the gift was restricted, its purpose would have been fulfilled and, barring that, the lower court should have reformed the gift under the cy pres doctrine so that SAVE could spend it on a project as near as possible to the original intent.

The appellate court disagreed, saying SAVE had courted the Adlers, who had been long-time supporters of animal welfare but who had never made a significant gift prior to the $50,000 donation, with a campaign that specifically included the two rooms and a naming opportunity. “To be clear, the record shows that SAVE: (1) decided to construct a substantially smaller facility; (2) outside the Princeton area; (3) without any specifically designated rooms for large dogs and older cats; and (4) without any mention of plaintiffs’ names,” Judge Fuentes wrote.  He continued: "By opting to disregard plaintiffs’ conditions, SAVE breached its fiduciary duty to plaintiff.  Under these circumstances, requiring SAVE to return the gift appears not only eminently suitable, but a mild sanction.”


August 13, 2013 in Current Affairs, In the News, State – Judicial | Permalink | Comments (0) | TrackBack (0)

Monday, August 12, 2013

Russian Philanthropists Increase in Number and Generosity

Charitable giving is growing by leaps and bounds in Russia!

According to data collected by Bloomberg from 15 of the wealthiest Russians and from corporate annual reports and charitable foundations, a total of $1.64-billion was donated to philanthropic projects from 2010 through 2012. On average, respondents said they gave away 40 percent more in 2012 than in 2010.

Russian billionaire and nickel magnate, Vladimir Potanin, is leading his country’s newfound philanthropic calling.  Mr. Potanin is the first Russian to sign the Giving Pledge, promising to donate at least half of his wealth to charity.


August 12, 2013 in Current Affairs, In the News | Permalink | Comments (0) | TrackBack (0)

University of Iowa Receives $25 Million Commitment for Inherited Retinal Diseases Research

The University of Iowa Foundation last week announced receipt of a five-year, $25 million commitment from Las Vegas businessman, Stephen A. Wynn, in support of the university's Institute for Vision Research.

The funds will be used to accelerate progress toward finding cures for rare, inherited retinal diseases. According to a report in the Iowa Gazette, in recognition of the gift, the institute, which is working to develop gene and stem cell therapies that could restore vision, will be renamed the Stephen A. Wynn Institute for Vision Research.

"As a person who knows firsthand what it is like to lose vision from a rare inherited eye disease, I want to do everything I can to help others who are similarly affected keep the vision they have and eventually get back what they have lost," said Wynn, chairman and CEO of Wynn Resorts, Limited, who has retinitis pigmentosa, a disease that causes night blindness and weakness in peripheral vision. "The army of clinicians and scientists at the University of Iowa's Institute for Vision Research have uncovered many of the secrets of the genome and are now on the cusp of applying them in the clinic. I never dreamed that I would witness such breakthroughs in my lifetime, but the breakthroughs are now at hand."

Edwin Stone, director of the Vision Institute, reports that gene replacement therapies have already begun for certain inherited eye diseases.  For example, he states, earlier this year, University of Iowa scientists began conducting gene replacement therapy for a rare inherited eye disease, restoring a missing gene that makes it possible to restore vision to a child.

"Philanthropic support is very important to all aspects of academic medicine, but it is absolutely essential for developing treatments for 'orphan' disorders that occur in a few hundred people or less in the entire country," said Stone. "Mr. Wynn's generous gift will also help us maintain the very valuable collaborative relationships we have developed with other vision scientists around the world."



August 12, 2013 in Current Affairs, In the News | Permalink | Comments (0) | TrackBack (0)