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nonprofit governance

May 19

Legislative session: few changes for nonprofits

By Feature, Legislation

Compiled by Lynn Sygiel, editor, Charitable Advisors |

This year’s Indiana legislative session was not without controversy. Of the over 1200 bills that were originally filed for the session, several hundred made it through the entire process and were eligible for action by the governor. In addition, lawmakers approved a two-year $31 billion budget, which includes a $464 million increase in K-12 education spending.

While there were no surprises for nonprofits, here are bills that may have an effect on the way nonprofits do business.

If you want to learn more about any bill, click here.


HB 1009: Innovation Network Schools. (Behning)

Provides for innovation network school programs in school corporations. Establishes the career pathways pilot program. Establishes the innovation network school pilot grant. Repeals the article relating to the establishment of innovation network schools by the Indianapolis Public Schools.

Status: SIGNED BY GOVERNOR 5/7/2015

HB 1015: Benefit corporations (Cox)

Allows a business entity to incorporate as a benefit corporation under Indiana law.

Status: SIGNED BY GOVERNOR   4/30/2015

HB 1042: Education loan information. (Cox)

Requires a postsecondary educational institution that enrolls students who receive state financial aid to annually provide each student with certain information concerning the student’s education loans. Provides that an eligible institution does not incur liability for any information provided to students.

Status: SIGNED BY GOVERNOR 4/15/2015

HB 1435: Beer, wine, liquor prizes/charity auction sales (Olthoff)

Allows a nonprofit corporation that is a qualified organization under the charity gaming law (qualified organization) to give sealed bottles or cases of alcoholic beverages as prizes in a charity gaming event without obtaining an alcoholic beverage permit. Allows a qualified organization to auction purchased or donated alcoholic beverages in sealed bottles or cases, without obtaining an alcoholic beverage permit. Prohibits alcoholic beverages that are auctioned or given as prizes from being consumed on the premises. Repeals and replaces the current statute regarding payments to the commission. Requires the commission to accept payments by certain financial instruments. Allows the commission to charge certain fees.

Status: SIGNED BY THE GOVERNOR 5/4/2015

HB: 1635: Various education matters. (Behning)

Allows grants from the safe schools fund to provide school wide programs to improve school climate and professional development and training in alternatives to suspension and expulsion and evidence based practices thatcontribute to a positive school environment. Provides that a consolidated school corporation shall offer to transfer property to the township from which the consolidated school corporation received the property for any purpose if the property is no longer needed by the school corporation. (Current law requires the transferred property to be used for park and recreation purposes.) Allows the township to sell or lease the property to an Indiana nonprofit corporation that is exempt from federal taxation.

Status: SIGNED BY THE GOVERNOR 5/7/2015

HB 1636: Charter schools. (Behning)

Provides that a governing body of a school corporation, a state educational institution, and a nonprofit college or university must register with the state board of education (state board) if it has not previously issued a charter for any charter school prior to July 1, 2015. Makes changes to the definition of an “organizer.” Requires the state board to provide a formal evaluation of the overall state of charter school outcomes in Indiana every five years. Provides that a charter school may give enrollment preference to children of the charter school’s founders, governing body members, and charter school employees, as long as preference is not given to more that 10% of the charter school’s total population. Provides that if a proposal to establish a charter school concerns an existing charter school overseen by a different authorizer than the authorizer to which the organizer is submitting the proposal, the proposal must include written acknowledgement of the proposal from the current authorizer. Provides that a charter school may limit admissions to allow preschool students who attend a Level 3 or Level 4 Paths to QUALITY program preschool to attend kindergarten at a charter school if the charter school and the preschool provider have entered into an agreement to share services or facilities. Provides that a governing body is not bound by a collective bargaining agreement for employees of a conversion charter school. Provides that employees of a conversion charter school may collectively bargain.

Status: SIGNED BY GOVERNOR 5/7/2015

SB 267: Dual language immersion; biliteracy. (Kruse, Lanane)

Establishes the dual language immersion pilot program to provide grants to school corporations and charter schools that establish dual language immersion programs in certain foreign languages. Creates the state certificate of biliteracy. Requires that the appropriate designation appear on the student’s transcript. Requires the state board of education to adopt rules and to direct the department of education to administer the state biliteracy program. Provides that a school corporation, a charter school, or a nonpublic high school is not required to participate in the biliteracy program.

Status: SIGNED BY GOVERNOR 5/7/2015

SB 317: Community foundations. (Head)

Defines an “eligible community foundation” for state income tax purposes as an organization that: (1) is a tax exempt charitable organization; (2) satisfies the public support test for public charities; (3) is an autonomous, nonsectarian philanthropic institution with component funds established by many separate donors; (4) is accredited under national standards for United States Community Foundations; and (5) supports a broad range of charitable activities in a specific area of the state.

Status:  SIGNED BY GOVERNOR 4/23/2015

SB 327: Charity gaming. (Leising)

Provides that the prize for a progressive bingo game may not exceed $2,000. Provides that the total prizes for one pull tab, punchboard, or tip board game may not exceed $10,000. (Current law provides that the total prizes may not exceed $5,000.) Provides that the prize limit for a game using a seal card is $1,000 and a progressive or carryover pull tab game is $5,000. Requires that a qualified organization may pay for licensed supplies only with a check drawn on or by an electronic funds transfer from the qualified organization’s gaming account. Provides that a licensed distributor may obtain licensed supplies to be used in charity gaming only from an entity licensed by the gaming commission as a manufacturer or distributor or from certain qualified organizations. Reduces from three years to one year the amount of time that an Indiana affiliate of a qualified

organization holding an annual comprehensive charity gaming license must be in existence in Indiana before it may conduct a raffle or door prize event. Adds “bona fide state foundations” and “bona fide state organizations” to the list of qualified organizations that may receive an annual comprehensive charity gaming license. Requires a licensed distributor to notify the gaming commission of the sale of any licensed supply that has a certain prize level.

Status:   SIGNED BY GOVERNOR 5/8/2015

May 05

Cooper Union inquiry puts nonprofits on notice

By Feature, Fundraising, Governance

By James B. Stewart, New York Times |

In what should be a ringing alarm for nonprofit boards across the country long accustomed to minimal scrutiny or accountability, Attorney General Eric T. Schneiderman of New York has signaled that the laissez-faire approach to nonprofit governance is over.

Mr. Schneiderman’s office has sent letters to the board members of Cooper Union for the Advancement of Science and Art, the prestigious college founded in Manhattan in 1859 by the philanthropist Peter Cooper on the premise that it be “open and free to all.” Last year, after the school said it faced financial ruin otherwise, it began charging tuition.

The investigation, reported earlier by The Wall Street Journal, is focusing on the board’s management of its endowment; its handling of its major asset, the Chrysler Building; its dealings with Tishman Speyer Properties, which manages the skyscraper; and how it obtained a $175 million loan from MetLife using the building as collateral, according to people involved.

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May 05

From projects to people

By Feature, Fundraising, Governance

By Ken Banks, Ashoka fellow, Stanford Social Innovation Review |

Bill Siemering was about to jump in his cab to make an airport pickup when his home phone rang. It was the vice president of the MacArthur Foundation. “I was shocked,” said Bill, “when he told me I was being awarded a MacArthur Fellowship.” That phone call proved to be the turning point of his life.

He never did make that airport pickup.

Years before, Bill had been the director of programming of National Public Radio (NPR), where he had created the first signature program in public radio, All Things Considered. He had also crafted NPR’s first mission statement, and while vice president at WHYY-FM in Philadelphia, he was instrumental in bringing Terry Gross and Fresh Air from a local to a national audience. Not bad, you might think.

Despite blazing a trail, though, Bill had eventually found himself out of work; at that time, there just weren’t many opportunities in his sector. As he put it: “I’d spent over 30 years practicing the art and craft of my profession and had no way to use it. I felt like a pianist who lost the use of his hands.” Out of frustration and the need for a job—any job—he started training to be a driver for a car service at Philadelphia airport. He was about to go on his first driving assignment when he got the MacArthur call.

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May 05

Eight common innovation traps

By Feature, Fundraising, Governance

By Gabriel Kasper & Justin Marcoux, Stanford Social Innovation Review |

Innovation, it seems, is easier said than done.

Despite growing interest in applying innovation methodologies to social sector challenges over the past decade, more often than not, philanthropic efforts to support innovation fall short.

That’s because the processes, strategies, and structures that funders need to deliberately seek out and support innovation are often quite different from the ones they use for traditional grantmaking—a lesson many funders learn the hard way.

In our SSIR article “The Re-Emerging Art of Funding Innovation” last year, we highlighted many specific approaches that innovation funders are now using. But we find that many grantmakers still end up falling into one or more “innovation traps”—common mistakes that can prevent them from succeeding as they try to find and fund breakthrough social change.

Some of these traps are challenges related to execution and implementation; others are more conceptual, rooted in the way organizations think about what innovation is and what it can achieve. As you read through the eight common innovation traps below, ask yourself whether your organization has faced one or more of these problems, and consider sharing your experience in the comments.

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