Today the role of philanthropy is expanding and so are its responsibilities. Philanthropy Link is published by San Diego Grantmakers to help you meet the challenge. Our mission is to connect, inform, develop, and inspire a diverse group of foundations and corporations to stimulate effective philanthropy in the San Diego region. For more information visit www.SDGrantmakers.org.

Great Grants

The Alliance Healthcare Foundation

The San Diego HIV Funding Collaborative (SDHFC), a program of the Alliance Healthcare Foundation, recently announced the 2005 recipients of nearly $400,000 in grant awards for HIV/AIDS services in the San Diego region. The funds, raised through AIDS Walk San Diego and a number of local and national donors who contribute to SDHFC, will be distributed to 28 agencies that provide direct support and services to those affected by the disease. The additional funds raised have been reserved for critical funding shortages for the calendar year 2005.

The 2005 recipients, selected through a granting process spearheading by SDHFC, represent a wide-ranging group of 28 direct HIV/AIDS service organizations in the San Diego region. Some of the services that will be provided with these donated funds to the 5,400+ individuals and families struggling to survive with AIDS and the estimated 15,000 people infected with HIV in San Diego County are:

• Care and treatment;
• Prevention and education services for homeless and runaway youth;
• Medical services for HIV positive individuals in San Diego County and Northern Baja California;
• Educational support groups for multi-ethnic English and monolingual Spanish-speaking clients;
• Residential and hospice care; and
• Harm reduction services and materials.

FYI
The September 11th Fund, the largest charity created to help victims of the 2001 terrorist attacks, closed its doors on December 8. Established by the New York Community Trust and the United Way of New York City just hours after the destruction of the World Trade Center, the fund raised $534 million from more than two million donors. The money helped more than 100,000 people in 41 states and 16 countries, through direct cash assistance, training programs, mental health services and other recovery efforts, according to The September 11th Fund Final Report. To read more or download the report, click here.

Send us your "Great Grants"
Funders throughout San Diego want to hear about your great grants. Send your Great Grants to info@sdgrantmakers.org.

San Diego Grantmakers Hosts
California Attorney General Bill Lockyer

How is the spirit of accountability translated into the law that governs day-to-day grantmaking operations? How can standards be set without stifling the efficiency of foundations and nonprofit agencies that do everything from feeding the homeless to educating low-income kids, when money and staffing is short? How will pending legislation reforms help or harm charities and the people you serve?

By now you've heard the news: California's Nonprofit Integrity Act, SB 1262, takes effect on January 1, 2005. Perhaps you're wondering how it affects the nonprofit you lead, or one you support through charitable donations. Maybe you're worried that the new regulations will be difficult to follow and your organization's mission will suffer as a result.

The first step in adjusting to the new legislation is education: learn as much as you can about the finer points of SB 1262 and how they apply to your organization. While concerns about implementation and effects of the act remain, there are resources to assist nonprofit organizations during the transition to the new rules and regulations required by SB 1262.

As part of an effort to understand and learn about the Nonprofit Integrity Act, San Diego Grantmakers hosted Distinguished Speaker California Attorney General Bill Lockyer, in a series of discussions this fall at the University of San Diego. The Attorney General is the legal overseer of charities that do business in California. The Office of the Attorney General has jurisdiction to conduct investigations and bring legal actions to protect the assets of California charities and insure the assets are used for their intended charitable purposes.

To read more about Bill Lockyer's visit with SDG members and the implications of the Nonprofit Integrity Act, click here.

SB 1262 The Nonprofit Integrity Act

Thanks to Mary Lewis of Alliance Healthcare Foundation, below are some key points collected throughout Bill Lockyer's discussion.

SB 1262 General Points

• Religious organizations are exempt from the regulations.
• Audit committee requirements do not apply to trusts.
• Not only does the audit committee review and approve the CEO's compensation and benefits, this review now must include the CFO's compensation. If they receive the same increase or benefit change as the rest of the staff, the review is not necessary.
• SB 1262 covers two broad terms: revenue (vs. income) and gross (vs. net). According to a recent legal discussion " the intent of the law is to sweep in the broadest amount".
  Determining revenue will follow FASB, according to the discussion "you may need to have an audit to determine if you need an audit".
• GAAP requires accrual accounting, therefore organizations with $2 million must use accrual accounting, no general fluctuations from GAAP.
• The regulations could cause some confusion for grantors outside of CA, like Ford or Annie E. Casey, who fund in the state. It's been suggested that such organizations may need to modify their grant award agreements to exclude their foundations from compliance.
  

SB 1262 Audit Points

• If auditors do tax returns it does not affect "independent", although the audit committee must review non-audit work.
• For any nonprofit conducting an audit, the audit must be available for public disclosure 9 months after close of fiscal year. The public disclosure requirement for the audit is linked to the 990 disclosure requirements; that is, audit reports 3 years prior, need to be available in the office for walk-ins requesting a review. You need to allow anyone to review the reports on the spot or receive a copy according to the 990 guidelines. Posting on the internet may be another way to comply with disclosure; specific regulations may be written in this area.
• The issue about non-trustee members of the audit committee is an important one. According to the attorney, the standard of care in the California corporate code makes it questionable for non-trustees to serve on the audit committee. Membership should be 2-3 trustees at minimum and less than 50% of the members are from the finance committee (an undefined term in this law). The practical challenge is -- who is left to serve on the audit committee? You need someone with financial literacy & who is independent. The presenter stated that a trustee can serve on audit if he/she is an unpaid board member of another charity that receives a grant from the foundation, but recommended that no trustee should be on the audit committee who is a paid staff member of a grantee.
• SB 1262 states that while the Audit Committee recommends the selection of the auditor, the final decision to hire an audit firm must be made by the full board.
  
  

Furthermore, the California Association of Nonprofits comprehensively outlines the key provisions of this new law. To learn more about The Nonprofit Integrity Act, click here.

To read the Guide to the Nonprofit Integrity Act of 2004 from the Office of the Attorney General, State of California, Charities page, click here.

The Legislative Counsel of the State of California provides a search engine in reference to the text of the bill. To access this search engine, click here.

Upcoming Programs

Post Election Policy Update with John Edie
December 6th & 14th, 12:00pm-1:30pm
Telephone Conference

With the many implications for grantmakers that come about as a result of the presidential election, you are invited to join a timely OVERVIEW of possible legislative or regulatory actions related to philanthropy. This program is specifically for the country’s formal regional associations of grantmakers and their member foundation leaders.

This national teleconference will be led by John A. Edie, former long-time General Counsel for the Council of Foundations, and current director in the Washington National Tax Services division of PricewaterhouseCoopers. John will provide his analysis on the key issues that could affect grantmaking institutions, both in Congress and at the IRS or other regulatory agencies. He will also field select questions from participants. The program will be offered two times, at a program fee of $15.

Child Welfare Services: Our Future at Stake
December 8th, 11:30am-2:00pm
Casey Family Programs

Two years ago the three California regional associations, the Foundation Consortium, and San Diego County's HHSA presented Bold Changes, a statewide effort to improve the welfare for our most vulnerable children. Significant work, locally and throughout California, have occurred since with a redesign of the state's child welfare system.

Join us to learn about policy and practice changes being implemented in the public sector, how these changes impact the organizations you support, and how they may affect your work. A variety of experts including Bonnie Armstrong, Foundation Consortium, Laura Spiegel, First Five Commission, Jorge Cabrera, Casey Family Programs, and Roseann Myers, Commission for Children & Youth, will answer the following questions:

• What are the priorities of the plan? How will the work look differently at an agency, City, and County level?
• Where are the gaps? What are the elements of the plan critical for success which the public funders cannot or are not funding?
  

Committment to Systemic Change: Homeless Working Group
January 10th, 10:00am-11:30am
United Way of San Diego

We continue to discuss the issue of homelessness in San Diego and SDG's leadership role. A year ago a survey of member foundations demonstrated an interest in working collaboratively towards solving homelessness in our community. We all recognize that the time is now to move forward with a proactive initiative. Join this funder collaborative as we address a community-wide solution.

Regulatory Reform: Where will it take us?
January 12th, 3:00pm-6:30pm
USD Joan Kroc Center for Peace and Justice

Rick Cohen, named to the Nonprofit Times Power and Influence Top 50 List in 2002 and 2003, Cohen is one of the most provocative speakers in our field. A credible researcher and prolific writer in the field of philanthropy, Cohen heads the National Committee for Responsive Philanthropy (NCRP), a nonprofit advocating for increased philanthropic giving and access for disadvantaged disenfranchised constituencies. While you may or may not agree with all Cohen offers, he will certainly inspire a rich and intelligent discussion.

In September 2004, Paul Light of the Brookings Institution released a report documenting a widespread lack of public confidence in the ability of nonprofit organizations to spend their money wisely and to deliver services. According to Light, public confidence in the ability of nonprofits to carry out their work declined considerably as a result of the scandals that followed the Sept. 11th attack and has not recovered.

Why is the public skeptical and calling for more regulations? What can a nonprofit do to react to these regulations in a constructive manner? While a nonprofit’s first instinct may be to resist increased scrutiny, Cohen offers insight to a different approach. In this program Cohen will address his perspective on how increased regulation will help the nonprofit sector. We invite you to come hear this stimulating speaker and participate in the ensuing dialogue and reception with Rick Cohen.

Co-sponsored by the University of San Diego Nonprofit Leadership & Management Program.

From the Badlands to... The Path to a High Performing Nonprofit Sector
January 24th, 8:00am-3:00pm

Expanding on last year's popular presentation, Mary O'Hara-Devereaux, Ph.D., provides insights as to how to navigate the Badlands terrain with an updated context for operation. Dr. O'Hara-Devereaux will provide guidance for small group discussions which will lead to mini-presentations (by attendees) of creative ideas and innovative solutions.

Co-sponsored by LEAD San Diego, The San Diego Foundation, and Sempra Energy

Corporate Series: Measuring Investment
January 25th, 8:30am-10:30am
Sempra

How do corporations measure investments in their community? What’s the incentive for giving?

If it has value, you can measure it. If you measure it, you can prove it has value. For corporate grantmakers this can be accomplished by:

• Determining the bottom-line value of your company's community involvement efforts
• Determining which programs contribute the most value
• Evaluating incoming requests for dollars, in-kind contributions and employee volunteers
• Relating community involvement outcomes to marketing and sponsorship impacts
  
  Do you have measurable evidence that your company's community involvement programs contribute to your company's competitive edge, strategic goals or bottom-line? Can you justify their value-added benefit to senior management?
  
  Join us as Molly Cartmill, Sempra Energy, moderates a panel discussion of business colleagues at our third session of San Diego Grantmakers Corporate Series programming. Explore the tangible benefits of corporate giving and learn how giving programs are structured to support your business strategy.
  

Mark You Calendars:

Stewards of the Future: An Institute in Strategic Nonprofit Board Governance
February 5th, 9:00am-3:30pm
USD Joan B. Kroc Institute for Peace & Justice

The Center for Corporate Citizenship at Boston College presents... Evaluating Community Investment Programs
May 3rd
11:00am-2:00pm

 

Upcoming Funder Events

COF 2004 Winter Institutes
December 6th-8th
Washington DC

International Human Rights Funders Group Meeting
Building Human Rights Constituencies
January 10-11, 2005
San Francisco, California

Human rights and social justice leaders will discuss tools and
strategies for reaching and mobilizing new communities to claim their
human rights. On the second day, a panel of funders will share their
insights into best practices for funding work to build broader
constituencies for social justice and human rights at home and abroad.
For more information, contact Catherine Townsend, ctownsend@mertzgilmore.org.

COF Family Foundation Conference
January 23rd-25th
Miami, FL

COF 56th Annual Conference
Building Strong and Ethical Foundations
April 10th-12th, 2005
San Diego, CA

For questions or comments about SDGrantmakers or our Philanthropy Link visit www.SDGrantmakers.org or contact Julie Holdaway, 619/744.2180
Julie@SDGrantmakers.org.

Feel free to comment, suggest article ideas, or submit news items. Link@SDGrantmakers.org -- We're always happy to hear from you. Philanthropy Link is a service to San Diego Grantmakers members. Copies of past editions are archived at News You Can Use.

If you do not wish to receive the monthly Philanthropy Link, send an email to Link@SDGrantmakers.org requesting to unsubscribe in the body of the email.