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The Nonprofit QuarterlyMore Transparency Needed in Fla. Nonprofits
Dec 13, 2009; The News-Press | An article posted Sunday in the southwestern Florida, The News-Press, reports that nonprofits in the area are not as transparent as they should be. “At this time of year, many people are looking to make donations to nonprofits — and get a tax deduction in return. Yet it can be a challenge to find information about some nonprofits,” writes Amy Bennett of The News-Press. In random visits to 30 Lee County nonprofits, The News-Press was able to see the records of only five. Transparency is commendable and easy access to public records (from tax-exempt and governmental agencies) is essential for our democracy. Government agencies, in particular, have long lagged behind in their obligation to allow citizens open access. Consider the seven-month investigation by Massachusetts-based CommonWealth magazine that revealed public officials at all levels of government frequently game the Massachusetts Public Records Law. The investigation found that “public officials often ignore records requests, claim records don’t exist, disingenuously claim exemptions, redact so much from the records as to render them useless, and charge so much money to produce the documents that they are unaffordable for most citizens.” Nonprofits should lead the way and show their counterparts in government that allowing easy access to public records is the right thing to do.—Aaron Lester

The Nonprofit QuarterlyNeighborhood Stabilization, Part III
Dec 11; CNN Money | Breaking news: The House passed a bill on Friday that would regulate the financial sector (about time, we say!). But for nonprofits, there’s a very important component. Under the direction of House Financial Services committee chair Barney Frank (D-MA), the legislation adds another $1 billion—apparently meant to come from untapped or repaid bailout or TARP funds—for the acquisition and rehabilitation of bank-foreclosed properties. This essentially amounts to the third round of the Neighborhood Stabilization Program (NSP), originally created in quick response to the first big wave of foreclosures and expanded as NSP II in the stimulus legislation (the American Recovery and Reinvestment Act). This NSP III is modeled after NSP II, but there is a learning curve at the federal level. Realizing how difficult it has been to pry foreclosed properties out of the hands of lenders and servicers, the new bill would waive the requirement that half of the funds be spent in 2 years and all of them in 3 years. Why the slowed down pace? Perhaps because it’s clear that these are much harder projects than anyone might have ever guessed, the lenders and others holding the properties generally unwilling to loosen their grips on the properties, and the conditions of the REO properties (the ones the banks couldn’t auction off) terrible in many cases. Nonprofits are major users of NSP funds. A capitalized, smarter NSP program will be welcomed by nonprofit community developers. Now the challenge is to get the lenders and servicers to let go their death-grips on foreclosed properties; and to get the Senate to catch up to the House on financial services regulation.—Rick Cohen

The Nonprofit QuarterlyTuition Tax Showdown in Pittsburgh
Dec 11, 2009; The Pittsburgh Channel
| It’s hardball pitching against hardball pitching. The jejune Pittsburgh mayor, Luke Ravenstahl, laid an ultimatum on the laps of the leaders of the city’s nonprofit universities. Either they ante up $5 million for the City’s coffers every year, or the Mayor and the City Council enact a one percent tax on tuitions. Without flinching, the Pittsburgh Council on Higher Education, functioning as the trade association for the city’s major colleges and universities including the University of Pittsburgh and Carnegie-Mellon, responded with what was tantamount to “no deal.” The universities pointed out that the Mayor’s tuition tax was probably illegal and unenforceable—and unfairly places a burden on students to pay for the City’s having neglected the capitalization of its pension plans for many years. Mayor Ravenstahl got back into the batter’s box and repitched his “Fair Share Tax” on tuitions, calling it the “only legally available option” that will help “the residents of our City, who will ultimately be the ones suffering if our non-profits do not pay their fair share.” Maybe someone might want to remind the mayor that the sate-appointed Intergovernmental Cooperation Authority which oversees Pittsburgh’s finances has already said that the tuition tax was not enforceable and therefore would not approve the Mayor’s budget predicated on a tax that can’t be collected.—Rick Cohen

The Nonprofit QuarterlyAnger at Goldman Lingers on Hill
Dec 11, 2009; Politico
| In recent weeks, the now fabulously profitable Goldman Sachs has blunderbusted its way into the doghouse of many members of Congress. The TARP-subsidized Wall Street behemoth  announced potential 2009 bonuses of $700,000 per employee, hardly a great piece of PR for the households who have lost homes and jobs as a result of the financial sector’s 2008-2009 meltdown.  But the Goldman CEO defended the firm as doing “God’s work,” apparently a federally subsidized deity. Then the CEO observed that Goldman really hadn’t needed the TARP bailout after all, a statement hardly believed by anyone with a lick of common sense given Goldman’s own financial troubles at the outset of the Great Recession. With advice from some of the nation’s better known nonprofit consultants, Goldman announced a plan for charitable giving, including $500 million to help small businesses, with an obvious eye toward generating some positive public relations buzz to counter its ham-handed self-inflicted damage. Sorry, Goldman, but the charitable giving plan didn’t work with Congressional critics the way the press mavens wanted. Senators such as Oregon’s Ron Wyden and Vermont’s Bernie Sanders have not been won over by the Goldman philanthropy and pledged powerful regulatory tools in the new financial sector legislation proceeding in both houses of Congress. Of course, the behemoth will probably end up escaping the sharpest lens of the legislation, given that it takes its strongest aim at retail banks, mortgage lenders, and credit card issues—and Goldman isn’t any of these things. Isn’t that the way it always is? The biggest miscreants get to cover their tracks and the collateral damage hits the smaller players who might have also contributed to the mess, but not in anything like the magnitude of the biggest ones.—Rick Cohen

 

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