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IRS nixes charitable donation substantiation rules

By Feature, Fundraising

By Diane Freda, reporter, Daily Tax Report Bloomberg BNA |

Jan. 7 — The IRS has withdrawn proposed rules that would have allowed charities to directly report donors’ contributions to the agency, saying it won’t implement an exception to the current “contemporaneous written acknowledgement” (CWA) requirement for substantiating contributions of $250 or more.

The Internal Revenue Service had been flooded with comment letters opposing the proposal released in September (180 DTR G-7, 9/17/15).

In withdrawing the rules (REG-138344-13) Jan. 7, the IRS cited the substantial number of public comments it has received questioning the need for donee reporting, and especially, the collection and maintenance of Social Security numbers for use on a new information return.

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Prioritizing services for high-needs adults

By Feature, Programming

By Anna Cielinski, Senior Policy Analyst, Center for Postsecondary and Economic Success |

As the New Year begins, states have an opportunity to set policies that will improve employment and training services for low-income adults through their Workforce Innovation and Opportunity Act (WIOA) State Plans. These plans are due to the Departments of Labor and Education on March 3, 2016.

According to the updated Information Collection Request (ICR) regarding WIOA State Unified and Combined Plans, state plans must describe strategies to prioritize employment and training services for “public assistance recipients, other low-income individuals, or individuals who are basic skills deficient.” CLASP applauds this clear call for robust implementation of the priority of service provision for high-need adults. This strengthened policy, for which CLASP has advocated, will help ensure that states serve low-income people.

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The future of cities depends on innovative financing

By Feature, Finance

By John D. Macomber, senior lecturer Harvard Business School, HBR |

Today’s mega-cities have a footprint problem. They are developing horizontally, not vertically, with vast areas of low sprawl reaching out for miles from Sao Paolo, Lagos, New Delhi, Guangzhou, Jakarta, and many others. A central question our civilization must address is how we can avoid becoming a planet of informal slums.

Every year, hundreds of millions of people across the globe move from rural to urban environments in search of opportunity.  In a perfect world, governments would have the cash and the consensus to fund and coordinate the construction of the infrastructure required to sustainably accommodate a rapidly urbanizing world. But few governments appear to have the money or the political will to foot the up-front costs to prevent or fight fragmentation.

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State of the sector survey

By Feature, Fundraising

By Nonprofit Finance Fund, survey results |

NFF’s 2015 State of the Nonprofit Sector Survey focuses on the underlying causes of these dynamics by exploring the programmatic, financial, and operational issues facing nonprofits across the U.S. It launched the Survey in 2008, when economic crisis threatened the viability of many organizations.

Seven years later, results from 5,451 respondents show some indications of recovery, stabilization, and growth. Nonprofits are adding jobs, engaging in strategic conversations such as leadership succession planning, and looking to retain their workforce. Yet as they raise their sights from the focus on short-term crisis, many are confronting the troubling reality that current practices cannot sustain organizations in the long-term or meet the needs of the communities they serve now. Many organizations have stumbled out of crisis looking to make the necessary investments to secure their long-term future. And it is a hard road ahead. 

Key findings

Under-resourced communities are going without because nonprofits can’t meet demand. Americans — particularly those in low-income communities — are still struggling to secure jobs, affordable housing, and healthcare.

  • 76 percent of nonprofits reported an increase in demand for services — the 7th year that a majority have reported increases.
  • 52 percent couldn’t meet demand — the third year in a row that more than half of nonprofits couldn’t meet demand.
  • Of those who reported that they could not meet demand, 71 percent said that client needs go unmet when they can’t provide services.  

The 2015 NFF Survey Analyzer at survey.nff.org allows you to investigate questions that cut across sub-sectors, budget size, geography and other dimensions.

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Six trends that will set the pace for 2016’s philanthropy

By Feature, Fundraising

By Bruce DeBoskey, The DeBoskey Group, for The Denver Post |

With record levels of giving, new approaches to marshaling philanthropic assets for impact, and better approaches to philanthropic strategy, 2015 was a great year for philanthropy. This trend will continue in 2016.

Increasingly, leaders in businesses, foundations and families understand that philanthropy is more than the merely transactional act of writing checks to favorite nonprofits. Today, philanthropy is seen as a strategic investment that is transformational for both society and the donor.

In the coming year, expect to see: The increasing impact of women

Women continue to demonstrate innovation and leadership in the field of philanthropy — and with big impact. Women now control more than half of the private wealth in the United States.

Looking forward, women are expected to inherit 70 percent of the $41 trillion in inter-generational wealth transfer that will take place over the next 40 years. By 2025, women will comprise 60 percent of U.S. billionaires.

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Five things learned from a year of INNovation Fund grants

By Feature, Programming

By Kevin Davis, CEO, Investigative News Network |

Last winter was the third round of the INNovation Fund, a micro-grant program managed by the Investigative News Network to help with business experimentation in nonprofit and public-media newsrooms across the country.

Unlike for-profit organizations, nonprofit news organizations do not have equity to leverage when seeking capital for business investment. Furthermore, most grantmaking puts limitations on the amount of overhead allowed on any given grant.

Yet nonprofit newsrooms are expected to iterate and innovate to increase the amount of engagement with their target audiences, reduce their dependence on existing funders and diversify their revenue streams to become sustainable.

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Food nonprofits making a difference

By Feature, Programming

By Tove K. Danovich, founding editor, Food Politic |

As the Good Food Movement has grown over the last decade so too have the number of organizations dedicated to helping more sustainable food find its way to as many people as possible. Though many individuals have worked to raise awareness, numerous victories have been made from collections of people volunteering their time and donations to fund food projects they hope will make a difference.

Though I wish this could be a thoroughly scientific best-of list, there are simply too many great nonprofits around – national and local. (This is a great problem to have!) The purpose of this list is to share some great organizations that you might not have heard of. They appear in alphabetical order within categories.

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Indy Hunger Network: Fighting hunger together

By Feature

By Lynn Sygiel, editor, Charitable Advisors |

In 2009, food activists planted the seed of change for hunger relief programs across the country. They said the national system, developed largely in the 1960s and consisted largely of soup kitchens and food pantries, needed to change its delivery systems and get food to people where they live and work.

That same year, Indianapolis-area hunger relief programs banded together as a volunteer coalition and formed the Indy Hunger Network (IHN). Its goal was to find ways to make the system more efficient and effective, while dramatically reducing hunger. One of its efforts was to connect the more than 200 small food pantries in the city run primarily by churches. Through IHN’s work, the number of meals provided in Marion County grew by 40 million.

Today, IHN is still volunteer-led and works to ensure that anyone who is hungry can access nutritious food. It has continued its work with representatives from leading anti-hunger organizations, both public and private, as well as community volunteers.

Its partners include: Connect2Help, CICOA, Department of Education, Elders at the Table (EAT), Elanco, FSSA (SNAP), Gleaners Food Bank, Interfaith Hunger Initiative, the Indianapolis mayor’s office, Meals on Wheels, Midwest Food Bank, Second Helpings, St. Vincent de Paul and WIC.

In 2014, the Indy Hunger Network did a study to better understand the city and its food distribution systems. The group knew that there were many meals being served, but focused its efforts on sustaining the system and improving access to nutrition. They also recognized that this collective effort was key to fighting food insecurity in Indianapolis, but together they could make systemic change.

According to Betsy Whitmore, communications manager from Second Helpings, this collective effort and multiple approaches are helping tackle the community’s hunger.

The network works together in other ways to ensure better use and learning from each other. For example, when a provider gets too much of a type of food, and it is able to redirect or share.

“We work with Gleaners and trade all the time. They’re like, ‘We got a whole bunch of this, can you use it?’ There are things that are canned goods, nonperishables, things that they need. When they show up with their truck, we switch. Some of our re-directed food goes to St. Vincent de Paul,” said Whitmore.

“What I find interesting is that the Indy Hunger Network is people who come at hunger from so many different directions,” said Whitmore. “If there were a silver bullet one way to feed people who were hungry, I think we’d as a society have found it by now. But it takes all of these people to make sure that food banks and food pantries are getting to people.”

And its work hasn’t gone unnoticed. In December, Jim Morris, an Indianapolis civic and business leader, was awarded the 2015 Daniels Prize for his lifetime efforts to push against the status quo to improve the lives of Hoosiers.  Morris served as executive director of the United Nations World Food Programme from 2002 to 2007. As the recipient, Morris was able to select a $100,000 grant recipient.

Morris’ choice was the Indy Hunger Network to address the hunger issues involved in infant health.

To learn more about IHN, visit: http://www.indyhunger.org/who-we-are/community-partners

 

Second Helpings’ approach to food insecurity

By Feature, Programming

By Lynn Sygiel, editor, Charitable Advisors |

The problem was an old one: hunger in America. Or more specifically, hunger in Indianapolis. What was needed was a new solution, and with that forward thinking, Second Helpings was born.

In 1998, three area chefs – Kristen Cordoza, Bob Koch and Jean Paison — saw tremendous waste in the food service industry. At the same time, they could see that local nonprofit food service programs were struggling to provide nutritional meals. Surely, there had to be a way to channel the excess in one area to fill a need in another.

The trio took their chef’s hats off for a moment and put their business minds to work. Their creation — Second Helpings – was launched as a food rescue and hunger relief organization. And in doing so, Second Helpings had yet another mission: to train young chefs.

Second Helpings spokeswoman Betsy Whitmore wasn’t involved with Second Helpings when it began, but she has seen it grow to the successful organization it is today.

The Second Helpings formula works like this: the community kitchen accepts donated perishable and overstocked food and in turn daily prepares nutritious meals, and distributes them free of charge through local social service agencies. Second Helpings also trains unemployed and underemployed adults for meaningful careers in the culinary industry. The food comes from wholesalers, retailers and restaurants.

“The first 60 meals went to Holy Cross Family Shelter, and it was salad and a stew. The model — taking rescue food and making sure it’s prepared for nutrition and balance – hasn’t changed. The chefs were very smart about knowing, ‘Here’s this overage, here’s this need, how do we connect this?’” said Whitmore, the communications manager, who keeps the organization’s first meal ticket on her desk as a reminder.

Whitmore said Second Helpings was just something the chefs knew they had to do. One chef said it was not a project she found, it was a project that found her. Because they worked in the food industry, hunger was a problem they couldn’t understand.

What Whitmore believes has changed in 17 years is the face of hunger.

“What people don’t understand is what hunger really looks. Most of them are working families. They’re people who may have had major life changes, change in jobs, things like that. She said most of the people who receive food from Second Helpings, food pantries or feeding programs are from working families.

On a daily basis, Second Helpings volunteers prepare and deliver 4,000 meals. Last year, the nonprofit prepared and delivered 955,869 meals to 80 social service agencies. Forty-seven percent went to children, 31 percent to adults, 17 percent to families and 6 percent to seniors.

From a food standpoint, it adds up to about 2.3 million pounds of food. Kroger, Trader Joe’s, US Foods, Dr. Pepper Snapple group, Fresh Thyme Farmers Market and Sysco, are the top retail contributors, each contributing more than 100,000 pounds.

People who run food drives, for the nonprofit are typically asked to collect pasta and rice because those are not perishables. Weekly the organization goes through 70 pounds of rice and 350 pounds of pasta, which they incorporate into the meals. And while technology has been used by some operations, Second Helpings uses people to gauge what’s coming in and what’s going out, typically taking inventory by sight.

“We do everything by weight. Everything’s by weight because from a tax standpoint, whether it’s a can of beans or a rack of lamb, it’s pound for pound,” she said.

Whitmore also mentions the savings to the local nonprofits on the receiving end of the food. “Those agencies don’t have to spend that money on food, so they can use their dollars and resources to help people better,” she said. Whenever Second Helpings on boards a new agency, it makes sure the organization and nonprofit are ready.

Whitmore mentions, another food source in the community, St. Vincent DePaul at 30th and Rural. One unique element is its grocery store set-up.

“There is a lot of dignity that is put into it,” she said. “I think that awareness and education has changed. I think that people are starting to get a better understanding of what hunger really looks like in a community. There will always be some who don’t understand. But I think the more we educate people, so that people realize that it’s not just soup kitchens. Hungry people are your neighbors.”

There are also sites that serve meals provided by Second Helpings, which have food pantries. Families get a meal and have food for tomorrow. Some of the stigma, too, is reduced at the community-feeding sites.

“Nobody wants to show up and say, ‘I’m here because I’m hungry.’ I think it’s nice to know that it’s not just one way that we’re feeding people. One model that may work for one family may not work for the other.”

At these sites, besides getting a hot, nutritious meal, people get introduced to foods. Vegetables are often added to mac and cheese or a curry dish will be distributed.

“In a lot of ways, hunger is something people deal with very privately. It’s a dignity thing. But if it’s a community meal where my neighbors can just sit down and eat, it’s OK. I like to think of it as the extended family table because you don’t sit next to someone at a communal table and not eventually talk to them,” she said.

Whitmore said she sees the need increasing, and Second Helpings has seen a 12 percent growth in meal production annually.

“The model that we have here is always poised for growth, and we’re always reassessing what does our future look like, and what is our plan for the future if growth happens. It’s something you have to do, because especially when you’re dealing with hunger relief, it is tied to so many other problems in the community,” she said.

Nonprofits assail IRS rule

By Feature, Fundraising

By Tim Devaney, staff writer, The Hill |

Nonprofit groups are assailing a proposed rule from the Internal Revenue Service, warning the regulations could dry up donations and leave them vulnerable to hacking.

The IRS is proposing new requirements for nonprofits to collect the Social Security numbers of their donors.

Currently, nonprofits send donors a form verifying their contributions, which they use for tax purposes. However, the IRS is proposing changes that would require these nonprofits to collect their donors’ SSNs to provide directly to the agency.

But this could put a bull’s-eye on nonprofits, critics say.

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