Nonprofit Newswire | August 4, 2009

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Nonprofit Globe no easy fix:  Such changes costly, legally complicated
Aug 3, 2009; Boston Herald | For all the conversation about converting for-profit newspapers to nonprofits, there hasn’t been much explaining some of the obstacles. In this article, discussing the rapidly sinking Boston Globe, there is a group headed by a former Bain executive (remember, Bain was where Republican presidential candidate—and former Massachusetts governor—Mitt Romney worked and earned his private sector laurels; and Bain was also the incubator for the nonprofit consulting group, Bridgespan) that hints that its acquisition of the Globe would be a “civic approach” with a nonprofit involved in the ownership structure in some way. Some of the obstacles for nonprofits? Here are a few: (1) how low can you make the acquisition price (really requiring a donation of the multi-million dollar-valued newspaper property given the size and scale of many major newspapers like the Globe)? (2) like the problem for the automobile companies, who assumes the pension liability (in the Globe’s case, that’s $51 million)? (3) if a nonprofit owns the newspaper, does that eliminate the newspaper’s ability to do partisan political endorsements, as newspapers traditionally do on their editorial pages during elections? (4) does nonprofit ownership of a print newspaper like the Globe insulate it from what the economy and the competition do to print journalism? —Rick Cohen

Federal judge sides with nonprofit right to free speech
Aug 3, 2009; The New Mexico Independent | Yesterday’s federal court ruling that New Mexico would be infringing upon nonprofit free speech rights settled a year-old case that questioned whether the organizations’ direct mail pieces, critical of state lawmakers, amounted to electioneering.  While the state still has the opportunity to appeal, nonprofits should celebrate this victory today. —James David Morgan

Poor economy forces United Way of the Lakeshore cuts
Jul 27, 2009; The Muskegon Chronicle | In this story, the United Way had to cut almost $400,000 in this year’s distributions to local nonprofits, mostly, according to the reporter, across the board, but cutting 5 groups to zero.  One of the five groups, Volunteer Muskegon, will lose matching funds from the IRS which the United Way funds helped leverage for the organization to provide tax preparation services for poor people—obviously a great service helping people access their Earned Income Tax Credit (EITC) refunds which so many people don’t know about or fail to get. These have to be very tough decisions for United Way volunteers. Unlike foundations that are often physically and socially distant from their grantees, for United Way decision-makers, the charities they cut or zero out are organizations and people they know and live with as neighbors and colleagues. —Rick Cohen

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