Gratitude and Misgivings . . . editor notes issue #75

Gratitude can be what gets us through a bad day. Or now, as the year comes to an end, gratitude can help us see the good in the past year and look at the coming year with hope. We at Blue Avocado are so grateful to all of you who read Blue Avocado, comment on articles, criticize us and praise us, reprint articles, and send us notes.

Let me take a moment, too, especially to thank our advertisers (see right and at bottom of page),  our founding sponsors -- the Nonprofits' Insurance Alliance Group and CompassPoint Nonprofit Services -- and the 200+ individuals who have donated to Blue Avocado (we're like public TV: free to read but there are pledge breaks).

But this season comes with misgivings as well. The recent flurry of activity over the proposed cap on charitable deductions made many of us feel drowned in urgent calls to action pressing us to write to our Congressional representatives to make sure that the most affluent among us don't pay any more taxes as a result of making donations. (Some of the email and OpEd campaigns implied that all charitable deductions would be reduced, not just those in the very top tax bracket.)

Is there something off when the nonprofit's sector biggest campaign of the year is about defending the top 1% because otherwise they won't donate as much?

In fact, the whole exercise felt something like a Kabuki play about Chicken Little . . . mannered, rehearsed movements predicting doom when just about no one really thought the deduction reduction would ever take place.

We support the charitable deduction at its current level, but we couldn't help but have misgivings about the cry-wolf hyperbole and the characterization of nonprofits as charities that rely on donations from the wealthy rather than as economically robust drivers of social change, innovation, and prosperity. Just saying.

So with a mix of gratitude and misgivings, a very merry Christmas and happy holidays to everyone, and a peaceful and prosperous new year.

* This issue is a fun mix: a harrowing update on the Vanguard Foundation story, a hair-raising story of how one nonprofit got through an IRS audit, a helpful (if slightly boring) article on interviewing candidates for the board, and a hilarious "Nonprofit Salary Calculator" just before you get your W-2 for the year. Plus a wonderful, unique gift you can give one of your co-workers . . . for free.

* See you in 2012 . . . Jan Masaoka

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I Survived an IRS Audit

Uh oh. We are all afraid of getting audited by the IRS, but we don't really know what would happen in one. Here is the True Life story of an environmental organization's audit, how they survived, and their tips for the rest of us.

It's the phone call everyone dreads: "Hello, your organization has been selected for an IRS audit." The call came to Karl Dickson (pictured left), board treasurer of an environmental nonprofit in Milwaukee, and his caller ID showed that the call came from an unidentified cell phone. Karl's instincts were to suspect a scam.

Karl questioned the caller who told him (not very believably) that "most IRS agents don't have an office" and therefore use cell phones. She also told him they had been selected . . .

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Vanguard Foundation Update: With Leader Pleading Guilty, "Truth and Reconciliation"?

The Vanguard Public Foundation was a high-profile, influential, progressive institution in San Francisco: the original "rich kids" foundation making grants to radical grassroots organizations and involving community members in grantmaking. As we chronicled in earlier Blue Avocado articles, Vanguard's ambitions coupled with absence of CEO oversight led to making the Foundation and many of its donors easy targets for a get-rich-quick scheme. Rick Cohen provides this update:

In all likelihood, within the next couple of months the former president and CEO of the Vanguard Public Foundation -- Hari Dillon -- will be sentenced for his self-admitted role in a small-scale version of a Bernie Madoff-like scam.

And around the same time, Mouli Cohen -- the persuasive businessman behind the scam -- will be sentenced as well. Just two weeks ago, he was convicted in U.S. District Court on 15 counts of wire fraud and 11 counts of money laundering (plus three counts of tax evasion). More than $30 million of foundation and donor money have disappeared.

As of now: Cohen is in jail and Dillon is facing jail; the Vanguard Foundation has closed its doors; there's talk of a grantee lawsuit (for awarded but unpaid grants); some activists are calling for a "tribunal" or a "truth and reconciliation process;" and progressive nonprofits are . . .

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The Automatic Nonprofit Salary Calculator

Jon Pratt of the Minnesota Council of Nonprofits uses a tongue-in-cheek version of the familiar Salary Calculator model to comment trenchantly on the indiscriminate -- and not so indiscriminate –differences in how nonprofit staff get paid:

How much should you be paid for your nonprofit job?

What . . .  you want to get PAID? You mean an actual salary, not just a stipend, and for a nonprofit job that is not solely volunteer? Don’t forget to factor in all of the psychic income you get knowing you are making the world a better place! After all, you are doing the Lord’s work, so your reward may not be in this life but in the next. Plus, there is the prestige and halo effect – that has to be worth something!

Even after taking these not inconsiderable intrinsic rewards into account, you might still wonder whether you are getting paid the right amount of actual money (probably not) or whether one of your co-workers is getting paid the right amount (probably too much). The following fourteen data points provide a "scientific" formula (created by someone with two advanced degrees, neither of them in a scientific field) that you can use to check your salary against cruel reality:

1. Start by entering your organization's total budget here: ____________
Then enter the . . .

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Questions to Ask Prospective Board Members

A coffee date isn't a good idea only for beginning, tentative romances. A coffee or lunch date is an easy way to meet with individuals who may be good candidates for your nonprofit board. If you spend a few minutes ahead of time thinking about what to ask, you'll end up having a much better idea of whether it's a good match.

Frequently a first meeting with a prospective board member is set up as a lunch or coffee with a current board member and the executive director. It's a good idea to state clearly at the beginning that this is a "get-to-know-you" meeting and that no decisions need to be made before the meeting ends. Say that you'll follow up with a phone call to see if the individual is still interested and whether the board's nominating committee is still interested. If so, there may be another step or the nomination may go to the full board for a vote.

An alternative process is . . .

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Give Someone a 3-Hour Vacation!

What does everyone need more of? Answer: time! So set up a meeting with your boss or a co-worker, or someone you know in another nonprofit. Make it for December 22 or 23. Say it's really important and will take 2.5 to 3 hours. If they ask what it's about, say (in an urgent tone of voice) that you'll tell them at the meeting but they needn't worry.

Then, at 10 am on December 22 (or whenever you made the appointment), announce that there's no meeting and they now have three hours to go Christmas shopping or get a massage!

Many thanks to my CompassPoint co-workers Mike Allison and Andrew Goldfarb for this gift several years ago . . . which I still appreciate having been given. Jan

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