On this day in history…

Andy Warhol, American artist and leader of the pop art movement, died on February 23, 1987. Known for his silkscreen paintings Campbell’s Soup Cans (1962) and Marilyn Diptych (1962), Warhol’s image has been commercialized and reproduced all around the world since he first exhibited his work in the 1950s. In 1968, Valerie Solanas, a radical feminist writer, shot Warhol at his New York studio. Earlier in the day of the attack, Solanas had been turned away from Warhol’s studio after she asked him to return her script. The script was supposedly misplaced. Warhol was seriously wounded and hospitalized where surgeons opened up his chest to massage his heart and stimulate movement. Warhol continued to suffer physical effects for the rest of his life before dying in his sleep from a sudden post-operative irregular heartbeat in 1987.

1.              Accountability Demanded for HBCUs to Thrive

New legislation is being introduced regarding equitable funding and capacity building for the future of Historically Black Colleges and Universities (HBCUs). HBCUs often struggle to maintain their institutions due to typically smaller endowments, higher rates of students receiving federal aid, and less access to federal funding programs. In 2017, President Trump signed an Executive Order directing federal agencies to work more closely with the delivery of federal grants and contracts to HBCUs. However, many HBCU groups claim this Executive Order lacks appropriate enforcement mechanisms, which is a concern that led to the HBCU Propelling Agency Relationships Toward a New Era of Results for Students (HBCU PARTNERS Act). The HBCU PARTNERS Act calls for agencies to be held accountable to the Executive Order and respective funds intended for HBCUs by requiring such agencies to annually submit to Congress their plans to strengthen HBCUs’ capacity to participate in federal grants, contacts, or cooperative agreements. Agencies will be responsible for identifying federal programs in their jurisdiction in which HBCUs are under-represented and will further develop plans to improve HBCU engagement in such programs. According to David Sheppard, senior vice president of General Counsel for the Thurgood Marshall College Fund, “public universities receive 43 percent of their revenues from grants, federal contracts, or appropriations on average, while HBCUs only receive approximately one percent.” Many HBCU Presidents are advocating for more financial support and claim inequitable funding to their institutions. Within weeks the HBCU PARTNERS Act is expected to pass the House of Representatives. Although HBCUs represent just three percent of American higher-education institutions, they serve more than a fifth of Black college students and providing equitable funding access to these institutions is critical for Black communities across the country.

2.              Board Disputes as Nursery Management Changes Direction

Thirty-seven years ago, Sister Ann founded the Bay Area Crisis Nursery, which offers space for parents in crisis to drop off their children for a limited time of respite. During a recent board meeting, Board President Lynne Vuskovic, a banker, decided the board would transition to managing the nursery in a more business-like manner. The announcement of Sister Ann’s departure from the nursery came in the third quarter newsletter of 2018 and included no specific reason for her departure. Sister Ann was offered retirement which she declined, and was then placed on paid administrative leave. A dive into the recent history of the nursery provides appropriate context for Sister Ann’s removal. Evidenced in the nursery’s IRS 990 forms from the past two years, the nursery has been losing money every year including a loss of $183,000 in 2016. In the 2016 annual report Sister Ann noted the financial situation of the nursery was grim due to substantial financial loss and the parting of many employees from the nursery staff.  Research into the nursery’s financials shows a reliance of almost ninety percent on individual donations since the nursery does not receive any government grants, contracts, or any other type of sponsorship. However, Sister Ann’s departure still came as a surprise despite these factors that led to the unfortunate financial situation of the nursery. Sister Ann and her order are now calling for the entire board of directors to be replaced and for her return to her former position at the nursery. This dispute will continue as both parties proceed with legal counsel. Vuskovic vocalized her hopes for Sister Ann’s legacy to be celebrated and for Sister Ann to remain visible and connected with donors, while Vuskovic carries on her plans to run the nursery “as a business.”

3.              Mega-Donors Shift Power Dynamics within the Nonprofit Sector

A new wave of mega-donors is emerging and raising concerns surrounding the power dynamic between donors and recipient organizations. Mega-donors are tied to large-scale philanthropy since they have more resources than the average donor, thus allowing them to deal with complex and transformational philanthropy. For example, small donors may donate to a food bank while ultra-wealthy donors may be involved with tackling the broader issue of food insecurity. The value of large donors goes beyond the size of their gifts; mega-donors’ social and political capital comes along with their donations, as evidenced by a new form of strategic philanthropy combining research and advocacy to intentionally utilize donations to change public policy. However, there is a power shift when donors combine their wealth and influence with an investment mentality. With their money, large donors can set societal priorities primarily reflective of their personal interests. The rise of large-scale donors carries risks, as expected, so it will be crucial for organizations to weigh power dynamics to ensure the nonprofit sector remains a key component of democracy. If mega-donors grow to be considered threatening to these organizations, then the time is past when individual organizations, both big and small, are able to direct their own course and stability. Policy changes in the nonprofit sector may become necessary to ensure both small and big organizations maintain their agency and as to not alienate wealthy mega-donors from the sector, either.

4.                       Organizations Adopt New Model to Solve Human Resources Issues

Many small nonprofits and foundations are facings challenges related to human resources, and the arrival of the Professional Employer Organization (PEO) model has relieved these organizations of the time-consuming and costly human resources model from the past. Organizations that have struggled to ensure compliance with ever-changing regulations and to compete for top talent are now turning to PEO as an attractive solution to their HR problems. PEO allows employers to outsource HR risks, lower HR-related costs, and free up staff time for mission-related activities. HR duties have traditionally diverted time and funds from an organization’s mission to fix errors related to noncompliance or issues concerning employee benefits, thus further distracting the organization’s leaders from urgent matters related to the organization’s activities. PEOs use a “co-employment” model in which the employees of a nonprofit technically become employees of the PEOs too. With a much higher aggregate number of employees, PEOs use their greater buying power to offer a variety of options and to negotiate discounts on a variety of benefits from gym memberships to healthcare insurance. PEOs handle payroll, employee benefits, and completes official filings and compliance. PEOs consolidate benefits information and provide access through a single portal in which an employee can easily gain access to items ranging from external benefits to internal records. Current PEO models that are used by many nonprofits include ADP Total Source, Namely, Zenefits, and numerous others. There are pros and cons to the PEO model, depending on the size, type and needs of organization using PEOs. One size does not fit all in this case, and organizations should definitely assess their profile and needs before adopting the PEO model. However, current employers using PEOs appreciate the ease of the human resources burden, assured compliance with the law and the capacity to compete for qualified employees.