THE CHARITABLE DEDUCTION

On March 11, Prof Linda Sugin of Fordham University wrote a provocative op-ed in The New York Times, "Your Name on a Building and a Tax Break Too, Re--thinking Taxes and David Geffen's Gift for Avery Fisher Hall."  The thrust of her piece is that a donor’s name on a building should be treated as a major return benefit to that donor and therefore the gift's deductibility should be reduced by the "value" conferred, in this instance $15 million, the amount the Philharmonic paid the Fisher family to surrender the name.

As a career nonprofit fundraiser, I salute Professor Sugin's attempt to encourage even more philanthropy and tax justice, and I reject her well-intended proposal to do that through changes to the charitable tax code. She theorizes that future philanthropists would give more if current ones were incentivized to forego or foreshorten a naming opportunity in appreciation for their gift - or in exchange for it, as Sugin has it. 

For most nonprofits, creative presentation of untaxed "intangible" benefits for bigger gifts--with recognition being the most powerful--represent success or failure. In practice, many institutions are already encouraging short-term naming opportunities, for just the reasons Sugin gives. Would they be helped with new laws? Be careful what you wish for. First, limits on naming terms won't work with some (desperately needed) prospects, and second, why stop there? Once the IRS is allowed to start valuing intangibles, look out. That is my main point. Clear and just as it may seem, there is no little fix and it won't stay put. As federal codes and then each state attempt to place a taxable value on a wide range of ever-creative intangible recognition benefits, all representing different circumstances, the process risks introducing serious confusions and complexities, and, I'd predict, vigorously renewed attempts to eliminate the charitable deduction altogether. Confusion and complexity depress giving in a charitable heartbeat. 

-- Marilyn Bancel

Philanthropy Outlook 2015 and 2016

We are happy to recommend and pass along a new report presented by Giving Institute member firm Marts & Lundy and prepared by the Indiana University Lilly Family School of Philanthropy. In a word, "Total giving is predicted to increase by 4.8% in 2015 and by 4.9% in 2016."

A copy of the report can be obtained from Giving USA Foundation or Marts & Lundy.

 

 

FUNDRAISING TRENDS ... WINTER SURVEY

AS A MEMBER OF GIVING INSTITUTE our firm benefits from the work of the Nonprofit Research Collaborative (NRC), which studies trends in fundraising twice a year. We encourage our clients and other nonprofit organizations to participate in the NRC survey. The deadline  for the NRC Winter 2015 survey is Thursday, Feb. 19. NRC will learn about fundraising results for 2014 and the outlook for 2015. We will of course share the results.The survey can be found at www.surveymonkey.com/s/NRC_CFRE . 

Thanks in advance for being a part of this important research. The NRC could not provide our field with this valuable trend data without input from a wide variety of nonprofit organizations, including yours! 

MARILYN BANCEL REJOINS ORAM

MARILYN BANCEL has rejoined The Oram Group as partner and director of our San Francisco-based West Coast office, following two and a half years as in-house development director at CuriOdyssey Museum, a former Oram client. 

She has long been active with the Association of Fundraising Professionals Golden Gate Chapter, for which she has served as board member and officer and as chair of various programs and events, serving in 2000 and 2009 as co-chair of National Philanthropy Day. Marilyn is a recipient of the chapter’s Hank Rosso Outstanding Fundraising Executive Award (2002). In addition to consulting, Marilyn has been Adjunct Professor at the University of San Francisco where she has taught Capital Campaigns and Major Gifts in the College of Professional Studies, Institute of Nonprofit Management. She is author of the long-popular workbook, Preparing Your Capital Campaign (Jossey Bass/Wiley 2000).

Marilyn’s current client focus includes all facets of the work needed to position an organization to conduct major gift fund-raising and campaigns — feasibility and planning studies, organizational analysis, board development, prospect engagement, and strategic or institutional planning. In addition to CuriOdyssey other clients have included San Francisco Girls Chorus, World Arts West, Boys and Girls Clubs of San Francisco, California Academy of Sciences, Glide Foundation, Headlands Center for the Arts, Human Rights Campaign, Peninsula Interfaith Action, National Foster Youth Action Network, Bar Association of San Francisco, Raphael House, Synergy School, Spirit Rock Meditation Center, University of California Press Foundation, Population Action International, United Religions Initiative, and many others.    

Prior to joining Oram, Marilyn worked for fifteen years as an institutional fund-raiser—as director of development for The Exploratorium, a museum of science, art and technology - and an Oram client served  by Oram partner  Hank Goldstein. She was also director of development for The Oakland Symphony; and as founder and executive director of East Bay Performance, Inc., publisher of the bi-weekly journal Bay Arts Review. Before entering the non-profit field, she lived for three years in Turkey where she operated an 80-person cottage craft and clothing export business.

GIVING TUESDAY

We’ve been through Thanksgiving Thursday, Cyber Friday (which started weeks ago), Cyber Monday (today) and now …

Tomorrow, December 2, is Giving Tuesday, a virtual program in which anyone and everyone is encouraged to support whichever charities they choose; and the charities are free to promote themselves as they will. The best evidence is that GT creates a giving bump.  For more info visit www.givingtuesday.org.

Many gifts are new; others may be gifts that would have been made in any case. But the real value of GT is in creating awareness. The “father” of GT is Henry Timms, CEO of the 92^nd St. Y in New York. A few years ago he pulled together about a dozen people, of whom I was one, to pop this idea – which of course we all liked. The GT web site was created; we worked our nets; the group enlarged – and from then on has grown virally as was the intent. GT is not owned by anyone; there is no central organization; there is no board of directors.  Every charity is free to adapt GT to its own use as it sees fit. There are no copyrights or service marks. GT very much reflects Henry’s concept of ”the new power,” distributed freely and horizontally, rather than top-down – the traditional way.

Between now and year-end, the holiday shopping season, an estimated $616 billion will be spent by consumers; in all of 2013 Giving USA reports $335 in charitable gifts.

NATIONAL PHILANTHROPY DAY

Today is National Philanthropy Day in New York. It will be marked by a big luncheon at the Plaza. Along with the metaphoric rubber chicken and gooey red sauce on the chocolate dessert, outstanding philanthropic leadership in the tri-state area will be recognized by AFP, the Association of Fundraising Professionals. NPD was proclaimed as November 15^th each year by President Reagan to mark the extraordinary role of philanthropy and voluntarism in national life.  It has grown in acceptance over time and is now celebrated all around the country though not always on the 15^th.

I generally try to avoid large events. But for NPD I up the Compazine and attend because in the one warm chamber of my heart I actually appreciate everything everyone does to make the world a better place, no matter how hard, how long, or how messy the process may be. Change is one person at a time and it adds up. The private nonprofit sector, according to a White House report, employs 14 million people, 10% of the work force; and generates some $1.6 trillion in output, 5% of GNP. Over $335 billion of that is philanthropic giving. Though I may question the accuracy of this datum I have read that 60 million Americans volunteer. Whatever the real number may be voluntary action in the US is assuredly mega-class.

Following the day after Thanksgiving is Black Friday and then Cyber Monday, two days a year when US consumerism is at its rabid worst. As you have seen we barely got through Halloween before the holiday hawking began. In the past people have died in the stampede to load up on “stuff.” Next week we will have Giving Tuesday, a one day push for an extra gift to whatever charities anyone might favor. I’ll write about it next week. Meanwhile you might visit www.givingtuesday.org.

For now enjoy Thanksgiving.

... Sayeth the The New York Times today, November 7th.

This meaningless headline tops a two-column story asserting that "charitable giving is back in a big way." But is it? Yes it has improved since the recession. Those years hit the sector hard and there has been a modest recovery. And for that we should be grateful because no profits, especially those in the human services field, need every cent they can generate, particularly operating funds.

I don't  know what "new donor generation" they're talking about. Zuckerberg's $25 million gift to the CDC to "fight" Ebola is certainly significant especially because the US charitable response to Ebola has been dismal; the big relief agencies have been mum. Only Doctors Without Borders has been a consistent voice.

As a percentage of GDP giving remains locked at around plus or minus 2%; that hasn't changed for as  long as records have been kept. And the slowest part of the charitable sector to recover has been individual giving, described  by the Times as "the biggest drag." Many people think that foundations and corporations are hugely account for most of the $335 billion donated last year. But in fact the greatest percentage of giving is from living individuals. Internet giving is marginal; social media's impact on giving has been modest at best.

We are certainly  in a better place than we were a few years ago. Between now and year end charity will generate around 30-40% of its total annual giving revenue. We will know within a few months whether US charitable giving is inching up or really rebounding.