Losing Your Status

There have been two chilling stories in the news recently about organizations losing their non-profit status.

The first involves a Tennessee-based "religious charity" that lost its status basically because it spent such a small percentage of its budget on program. (Here's a story from the San Francisco Sentinel about it, another story from the Chronicle of Philanthropy.) It spent preposterously little on program, really, (less than1%!!) so it's hard to get worked up on their behalf. It sounds like a suspicious operation. But still, the principle that the IRS can pull your tax exempt status because of your program/administration/fundraising percentages is getting a lot of attention. The IRS has put non-profits on notice that it is keeping an eye on the efficiency and governance of non-profits. I've linked to recent talks given by Stephen T. Miller, one of the IRS commissioners in charge of nonprofits, about this issue and what he calls the "commensurate test."

The second case may hit closer to home--Monday's New York Times had a front page story about a Minnesota day-care center that had its nonprofit status revoked because, bascially, it didn't give anything away. The battleground for this organization is in the state courts, and the plaintiffs are local governments who want to collect property taxes. the courts could not find a meaningful distinction between the work of the non-profit day care (which didn't offer any discounts to low-income families or other discounted services) and for-profit day cares, which do pay corporate and real-estate taxes (if they own real estate). Every few years one hears similar murmurings about colleges and universities, especially Harvard, where the contrast between it's $35 billion endowment and its $0 property tax bill to the City of Cambridge is frequently invoked. (I believe Harvard does make a contribution to Cambridge in lieu of taxes, but still...).

Nerdy Productivity Books for Arts People

Getting Things Done by David Allen is exactly the kind of book I hate to get caught reading. It is a productivity book. Having it on your desk is an admission that you don't consider yourself to be productive enough. It also suggests to your coworkers that you think reading books about productivity is a good way to become productive... as opposed to just doing your work already.*

It's also one of the most helpful books about organizing your workday and yes, productivity, that I've ever read. It's description of the average modern workday is exceedingly familiar, and it's argument that we have never been trained to work in our present environments just seems right. And if you google the title, or even just GTD, you'll see that the book has what is often described as a "cult following," particularly among tech workers.

If you are feeling overwhelmed by your to-do list, you should get it, and read it. It will help. End of commercial.

The Worst Word in Marketing

...or so Stanford says. Here's an article from the Stanford Social Innovation web site about the word you should never use when evaluating marketing materials.

You'll Never Do This

I can't imagine a non-profit ever doing this in a million years. That's just not how we can use cash. But it's a compelling testament to the importance of having & keeping highly motivated employees. If I had more time this morning, I'd bloviate a little bit about how nonprofit employees are paid, in part, in mission (instead of dollars), and how this is mostly a good thing (the lifeblood of organziations), but can also be a bad thing (people who are dedicated to mission, willing to be paid too little, and sometimes aren't the best at their jobs).

A little fascinating, a little appalling...

I'm always interested, despite myself, in business articles about generational dynamics in the workforce. Here's one from the Harvard Business Journal online. It's not the first article I've seen about the connection between the Boomers & Gen Y. I present it to you with the Gen Xers salute--a shrug and a weary sigh. Of course, the Boomers literally gave birth to Gen Y, so there's really not big news here, but it is perhaps another example of the Boomer trait of making everything that happens into a Trend. When your demo's that big, everything is a trend, so why not.

This morning's discoveries

...after coming across the third reference to tech business magazine Fast Company in as many days, I finally went to check it out. It's fascinating--Fortune Magazine for the Web 2.0 era. I feel like I just got in on an old secret, but that's no reason not to share.

Reading Fast Company introduced me to Ning -- critics of the Fast Company article say that it's shameless advertising posing as journalism, and they have a point. But Ning is a pretty cool company I had never heard of before, perhaps best described as "make your own Facebook." You can build your own social network.

You'll also find that Chip and Dan Heath have a regular column in Fast Company. We're bringing Dan to Philly on June 10 to talk about Made to Stick & its relevance for nonprofits. Register here!

The New 990

We've been hearing about the new Form 990 for several years now. It's been so long, in fact, that it's been fairly easy (until now) to tune out the discussion. Well, the new form has been out for a little while now, and the draft instructions have recently been published. Bring on the seminars!

If you've been skeptical about whether the form would really be all that different, let me introduce you with a little taste of Section VI -- Governance .

Do you have a written conflict of interest policy? Do you have a written whistleblower policy? Do you have a document retention and destruction policy? Can you document the process for determining compensation for your Executive Director? Are you still breathing? Are you OK?

First, remind yourself that everything's going to be fine. It's all going to be OK. But if you don't have one of these policies, it's time to start thinking about it.

Stay tuned for more from PCMI on the new 990. We're putting together a program that'll happen soon. In the meantime, I'll link you to some comments from a recent lectures by Steven T. Miller, the Internal Revenue Service Commissioner for Tax Exempt and Government Entities, who has been one of the driving forces behind these changes. The first talk is about the IRS and its interest in nonprofit governance. The second is about efficiency and effectiveness (but it talks about governance too).

NPO Crush of the Day, part 2

...I suppose this is really more a crush of the week feature, but came across this profile from New York magazine of Alanna Heiss and P.S. 1 today. It's fascinating for a whole bunch of reasons, mostly Heiss herself, but also how it reflects so many issues of the day, from founder's syndrome to the strange pivoting of the contemporary art scene in NYC to brand management to mergers. The article skirts around, but fortunately does not commit to, a straight creativity vs. business binary... but it's an excellent case study.