Philanthropy This Week

istock

Good morning.

Nonprofits are often stretched thin, but uncertainty about what they will face during the next Trump administration has added another dimension to their worries. Possible loss of government funding, changes to laws and regulations, and an even bigger workload as more people face urgent needs have nonprofit leaders wringing their hands, reports Jim Rendon.

A growing number of groups have already been experiencing financial distress. Surveys in Minnesota and New York found that the number of organizations feeling the strain over the past year has grown by roughly half, with many having to weigh reducing their services.

“We’re absolutely seeing more challenges for the nonprofit sector around financial distress, and the financial sustainability of organizations, along with a rising demand for services,” says Nonoko Sato, executive director of the Minnesota Council of Nonprofits. “We are getting calls from organizations that are about to close their doors very quickly.”

More and more, it’s new, younger leaders who are dealing with these complex challenges because many longtime leaders have stepped down.

The fickleness of foundations isn’t helping — telling longtime grantees they’ve changed their priorities or reverting from grants for operating expenses to grants earmarked to specific efforts.

Collaborations could be one key to getting through this, and more groups are turning to loans. One arts nonprofit that had run a deficit for years came up with an innovative loan idea involving a donor-advised fund that turned things around.

“By creating these very favorable conditions that can move the money quickly to where we needed it, it protected the organization. It was a real lifesaver,” co-director Lauren Miller told Jim. “We could start the next fiscal year fresh without having to make dramatic cuts to our staff or to our programs.”

Here’s what else you need to know:

Architect of the Capitol

Despite opposition from many in philanthropy, the U.S. House has passed a bill that would give the Treasury Department authority to strip tax-exempt status from any nonprofit it claims supports terrorism, reports Alex Daniels.

Missouri Republican Jason Smith, chairman of the House Ways and Means Committee, said the measure was necessary to “stop this abuse of our tax code that is funding terrorism around the world.”

Critics of the bill include the American Civil Liberties Union, the Council on Foundations, and U.S.-based Jewish and Muslim organizations.

“This bill was being pushed by a party whose president happily talks about his enemies list and revenge,” Hadar Susskind of Americans for Peace Now, a Jewish nonprofit that promotes Arab-Israeli peace, told Alex. “It clearly was about empowering the incoming administration to really go after anyone they want in the nonprofit sector to really decimate civil society.”

Read more about the vote and the legislation from our partners at the Associated Press and about nonprofit opposition to the bill in a piece by our Ben Gose.

istock

Between voter dissatisfaction with many liberal causes in the recent election and a future vice president who’s been a strong critic of the nonprofit world, philanthropy should take stock of its approach to problem solving, writes Leslie Lenkowsky in an opinion piece.

“Like the Democratic Party, foundations and their allies will need to reassess how they can gain more public support for the field as a whole and for the issues they care about,” he writes.

Among the causes that will now pose greater challenges: immigration, abortion, criminal justice, and diversity, equity, and inclusion.

And as the 2017 Tax Cuts and Jobs Act comes up for reauthorization, universities and foundations with large endowments may face proposals to place high taxes on their assets.

“If the Trump administration endorses these proposals,” he writes, “universities and foundations will have to make a convincing case that they are spending their endowments effectively, not hoarding them or using them to underwrite partisan causes, as [Vice President-elect JD) Vance has claimed.”

Philanthropy is better prepared for the next administration than many people think, writes Dimple Abichandani, a fellow at the National Center for Family Philanthropy, in another opinion piece. After leaders have reimagined the “purpose and practice of philanthropy,” the sector is in a different place than in November 2016, she writes.

“This new era has grown out of interrelated efforts, including the trust-based philanthropy movement, the expansion of participatory grant making, a growing focus on mission-aligned investing, a reckoning with inequality, and an expanding commitment to reparations and repair,” she writes. “All of this has led to a widespread grappling with how funders hold and reallocate power and wealth.”

Iwan Baan

A Midwestern town is a mecca for anyone interested in mid-century modern American design, thanks to Joseph Irwin Miller, a philanthropist who in the 1950s wanted to attract the “best and the brightest” to his diesel-engine manufacturing company in Columbus, Ind., and to accommodate the growing baby boom population, reports Eden Stiffman.

He established a program at his company’s foundation to hire top architects to build schools, fire stations, public housing, and other structures.

“It wasn’t really an architecture program in its initial conception,” his son, Will Miller, told Eden. “It was a response to a community problem with a creative solution in the moment.”

Among the modernist masters represented in the town: I.M. Pei’s brick public library with a waffled ceiling, a fire station by Robert Venturi, and an Eero Saarinen hexagonal church with a narrow spire.

The architectural effort helped shape the culture of the town. Now nonprofits such as the Landmark Columbus Foundation maintain the historic properties and bring together diverse partners.

Despite Miller’s immense influence from the start of the project, he made a point of seeing that the community was deeply involved in decision making, too.

Interviewed for an oral history, architect Harry Weese, who designed 14 buildings there, said of Miller: “Irwin knew he had so much influence that he always wanted to protect himself from exerting it.”

We will not be sending Philanthropy This Week next Saturday because of the Thanksgiving holiday, but we will be back in your inbox on Saturday, December 7. In the meantime, we will update our website with any breaking news.

— Marilyn Dickey, Senior Editor, Copy

Emboldened by the election results, antiabortion groups are planning aggressive new moves to end the procedure nationwide. Among their priorities is stopping the flow of abortion pills by reviving enforcement of the 19^th-century Comstock Act, outlawing the shipment of any materials used for abortions. They also want to challenge laws in states where the procedure is legal that protect abortion-pill providers from out-of-state prosecutions. In Texas, a lawmaker has proposed allowing private citizens to sue internet-service providers that host abortion-pill websites, and Texas Right to Life is seeking men whose partners have had abortions to act as plaintiffs against the abortion providers in an effort to clarify an existing state law. (Washington Post)

Nonprofits in Aurora, Colo., which Donald Trump has made the focus of his promise of mass deportations, are figuring out how best to help the migrant community there. The director of the Aurora Migrant Response Network said his clients are roughly divided into long-timers, who are just living their lives and trying to weather another election cycle, and newcomers, who are waiting for hearings and fear for their lives if deported. One group in the network is offering open legal briefings and counseling its clients to always carry their papers, lest they be wrongly detained. Ultimately, that group’s leader said he expects to lose federal funding and is not optimistic about foundations being able to fill the gap. (Westword)

New York’s Planned Parenthood chapter is preparing for possible cuts in aid as Republicans take over the federal government in January. The organization’s president and CEO, Wend Stark, said she is hoping that donors and the state government fill in the gaps. Planned Parenthood of Greater New York and other state health-care providers lost $14.2 million in federal aid during Donald Trump’s first administration after refusing to comply with a federal order not to mention abortion as an option to their clients. Stark said Planned Parenthood has seen a spike in demand for abortions but there’s been no wave of “rage giving” as there was after Trump’s first election and the end of Roe v. Wade. (Gothamist)

Long a dream of many of Los Angeles’s working-class residents, tenant ownership is getting a significant boost, thanks to a pot of nearly $440 million raised from the city’s new “mansion tax.” Nonprofits, labor unions, and tenants groups have long worked in the margins, buying and converting small projects into “social housing.” Approaches differ, but all projects are meant to give tenants ownership, whether of their own units or shares in the building, and management responsibilities. Potential profits from any sales are capped, in order to keep the buildings affordable to new tenants. (Los Angeles Times)

Citing attacks and threats by the police, the medical charity Médecins Sans Frontières — Doctors Without Borders — is suspending service in Haiti’s capital. The move will leave only one hospital in Port-au-Prince offering trauma care, as gang violence has made it unsafe to report to work. It comes after a period of harassment and threats from police since MSF went public about a Nov. 11 incident in which police stopped one of its ambulances, shot two of its patients and attacked its staff. “We accept working in conditions of insecurity, but when even law enforcement becomes a direct threat, we have no choice but to suspend admissions of patients in Port-au-Prince until the conditions are met for us to resume,” said Christophe Garnier, the charity’s head of mission in Haiti. (Miami Herald)

The former chief financial officer for the Detroit Riverfront Conservancy has agreed to repay the nonprofit at least $44.3 million as part of a plea agreement involving federal fraud and money-laundering charges. Investigators say that since 2012, William A. Smith has stolen an estimated $40 million to $65 million from the group, which aims to transform Detroit’s post-industrial waterfront to a recreational space. Smith could face up to 20 years in prison for each of the two counts in the plea agreement. His lawyer did not return calls for comment. A conservancy official said it is reviewing its financial operations in the wake of the scandal. (New York Times)

In an episode that “matters in the broader fights over where to build more housing” around New York City, a Manhattan nonprofit weathered “brutal” opposition from neighborhood activists to develop an island of affordable housing on the Upper West Side. In an 11-story building where parking garages once stood, the West Side Federation relies heavily on local and federal subsidies to house older, formerly homeless, and low-income residents. Before it could start construction, though, the nonprofit had to make concessions to neighbors concerned about lost parking, congestion, and the potential effects of the project on a nearby school and park. (New York Times)

Many of San Francisco’s museums are struggling under mounting deficits, brought on by dwindling attendance, a sluggish downtown scene, and changes in philanthropic and government support. Among the more than a half-dozen arts and cultural institutions reviewed by the San Francisco Chronicle that have seen their revenues drop, the city’s Contemporary Jewish Museum announced recently that it would close for a year, coming off a roughly $5 million deficit in its last fiscal year. And while its recent attendance has ticked up, visitor numbers at the San Francisco Museum of Modern Art are still below pre-pandemic levels, as the museum reported a nearly $30 million deficit and eliminated 20 positions last year. (San Francisco Chronicle)

The Oregon Shakespeare Festival continues to reinvent itself as it emerges from one of the most challenging periods in its 90-year history. A year and a half after the departure of an embattled artistic director who sought to dismantle donor hierarchies and end the company’s reliance on “transactional philanthropy,” it is bringing back its perk-filled membership plan. It continues, however, to seek a wider audience, with targeted discounts and a spectrum of programming that includes untraditional approaches to the Bard. Like many theater companies around the country, the OSF is struggling to regain its footing after Covid closures, but it also saw donations drop during the short tenure of Nataki Garrett, a Black woman whose efforts to wean the festival off its dependence on older white donors alienated some longtime supporters. (Ashland News)

Your Chronicle subscription includes free access to GrantStation’s database of grant opportunities.

Advocacy: The Peace Development Fund believes that the change in values needed to establish a more just and peaceful world can come about only if it is strongly rooted in local communities that value the importance of building movements to create systemic social change. The Fund’s Community Organizing Grants support community-based organizations in the U.S., Haiti, and Mexico that are working for social justice. Funding is provided in the following areas: organizing to shift power, working to build a movement, dismantling oppression, and creating new structures. Grants average $5,000; application deadline is January 31, 2025.

Nature: The Community Forest and Open Space Conservation Program supports the acquisition of private forest land that is threatened by conversion and that provides community benefits including economic, environmental, educational, and recreational benefits. The program seeks to protect forestland from conversion to non-forest uses. Public access is required for all projects. Eligible costs include appraisals and appraisal reviews, land surveys, legal and closing costs, development of a community forest plan, and title examination.