Nonprofits may see longer downturn

Tom Parsons, writing for the Associated Press features Ruth McCambridge of Nonprofit Quarterly magazine. She believes that nonprofits are in for a longer than usual downturn if they are reliant on foundations for funding.

Once again, we recommend that nonprofits embrace revenue diversification. That is, not reliant on any one funding source, but embracing a spectrum of support besides grants, that includes discretionary donors, sponsorships, endowments and event fundraising.

Nonprofit expert sees longer-than-usual downturn

Charities tightening their belts because of the recession should gird themselves for a longer-than-usual downturn, the editor of Nonprofit Quarterly magazine said Friday.

Ruth McCambridge said the asset bases of foundations that provide much of the charitable giving in the country have fallen drastically, and grants from those groups have declined accordingly.

"And many foundations are planning to give less next year than this year," said McCambridge, who spent 35 years working at nonprofits before taking the helm of the quarterly in 1999.

Still, there are many creative ways "to help us get through this period," she told an audience at the Clinton School for Public Service that included many staff for nonprofit Arkansas agencies.

She recalled working at a women's shelter in Lawrence, Kan., as federal grants began to dry up in the early 1980s during the Reagan administration. The shelter got a notice that a grant providing 90 percent of the organization's budget would be discontinued in six months, she said.

The shelter staff and board - many of them volunteers - worked hard to expand the number of people involved with the organization and do more fundraising, McCambridge said.

"In the end, we had our budget covered locally, and we had been given a new shelter house," she said.

According to McCambridge, in nonprofits' drive toward professionalism, "we have forgotten that these people who are at our door every day are big assets."

Asked if organizations should consider dipping into reserves they have built up over the years, she said a lot depends on a group's particular situation. But if an agency's board decides that the rainy day has come, it shouldn't be done without an eye to the future, McCambridge said.

"You have to have a plan of what it's going to take to get through a period when you're using your reserves," and how to rebuild them, she said.

Philanthropy 101: students learn the science of giving

Tracy Jan of the Boston Globe writes about college courses enabling students to understand the mechanics of philanthropy through group research and giving.

For philanthropy courses, students become the givers

College students, many of whom spend the little extra cash they have on pizza and laundry, don’t fit the typical profile of a wealthy benefactor. But in a growing national movement, students enrolled in newly created philanthropy courses are steering thousands of dollars to local charities.

At Tufts University, students decided this spring to give $1,500 to expand English courses to immigrant parents in Medford. Northeastern University students donated about $2,500 to a Boston after-school program promoting cross-cultural tolerance through cooking. And students at Boston University distributed $7,500 to help local at-risk teens land jobs in the financial sector.

At least 10 New England colleges, including Brandeis, Holy Cross, Boston College, Wheelock, and Lesley, will offer similar courses next school year, using seed money donated by corporate and family foundations. In the classes, students draw up mission statements for makeshift foundations, research nonprofits in their communities, and decide how to allocate the pot of money.

The goal, say professors and donors, is to build upon surging interest in social responsibility among college students and make philanthropy part of the mainstream curriculum. A potential side benefit: helping colleges improve town-gown relations and, some professors said, cultivate future alumni donors.

“Some of these kids will become very wealthy in the future,’’ said Paul Schervish, a sociology professor and director of the Center on Wealth and Philanthropy at Boston College, who will soon begin teaching experiential philanthropy classes. “The professors see that this is a way to teach financial morality in the realm of philanthropy.’’

But teaching students how to give away money responsibly is more complicated than one would think, said academic leaders who gathered recently at Brandeis’s Sillerman Center for the Advancement of Philanthropy for the first national conference on teaching philanthropy. The Waltham college started a “practicing philanthropy’’ course this spring for graduate students and plans to create a similar course for undergraduates next spring.

Students spent about two months debating their priorities, ultimately narrowing their focus to organizations committed to economic development, and early childhood education. Their task: find worthy recipients of a $40,000 donation from the Sillerman family.

“At first everyone thought, ‘Oh boy, this is going to be easy. We have money to give away,’ ’’ said Charley Francis, a 26-year-old master’s student in public policy. “But the fact that we’re giving away real money adds a real seriousness to it. It’s not just an academic exercise.’’

Francis and his classmates drew up criteria on which they would evaluate the nonprofits, conducted interviews and site visits, and combed through financial statements, ultimately awarding four local charities each $10,000.

Two national foundations interested in promoting the teaching of philanthropy on college campuses began donating money for the courses across the country in recent years. The Sunshine Lady Foundation, established by Doris Buffett, sister of famed investor Warren Buffett, has given colleges $10,000 a year to disburse since 2003. The foundation’s Learning By Giving program will double next year to include 15 colleges across the country, including Tufts and Holy Cross.

The foundation has ramped up its efforts this year because there are greater unmet needs of all types because of state budget cuts, said Alex Buffett Rozek, director of Learning By Giving, and grandson of Doris Buffett. Undergraduate business students, who may wind up working for large corporations with charitable trusts, should learn to look critically at the needs and to assess how money is to be spent in the most effective way, he said.

“There needs to be better awareness of how to distribute these scarce resources more effectively, and do due diligence on how the money is actually used,’’ Rozek said. “It’s not just writing a check and saying, ‘Put my name on this building.’ ’’

The recent efforts on college campuses also build upon donations by Fidelity Investments, which in 2007 teamed with Campus Compact - a coalition of more than 1,100 colleges working to build civic engagement into academic life - to give schools one-time grants of $15,000. Fifteen colleges, including BU and Northeastern, participate.

In addition to just giving money away, the classes have inspired some students to choose careers in the nonprofit sector. At Tufts, where classes have disbursed $30,000 in the past three years, students learn to be grant writers and discerning grant makers. Those skills helped Laura McNulty land a job at the Somerville office of National Student Partnerships.

McNulty, who graduated in 2008 with degrees in community health and Spanish, had written a grant for the organization during a philanthropy class her senior year. Her class awarded $2,500 to the national nonprofit, which organizes student volunteers in antipoverty work.

“The hands-on experience of writing a grant, evaluating a grant, and then giving real money away made the whole class feel like it had a tangible purpose,’’ said McNulty, 22. “It made students feel more accountable for the work they were doing.’’

Her grant-writing experience and knowledge of what foundations look for when making funding decisions was invaluable in helping her secure a $10,000 grant to start her own nonprofit, Health Horizons International, McNulty said. She will move to the Dominican Republic this fall to help connect volunteer doctors on medical missions with community health initiatives in the Caribbean nation.

Students at other schools have taken what they’ve learned in the classes and spread the philanthropy movement campuswide. Northeastern students started an extracurricular club last fall that operates as a de facto board of directors charged with overseeing, and growing, the pot of money students disburse through the philanthropy classes.

Missy Elumba, a health sciences major and ice hockey player who founded the club, also started a spinoff for NU student athletes. The group granted about $8,000 to local youth sports organizations, including helping bring tennis to impoverished Boston elementary schools.

“The class inspired me to make a difference and build something that could go on year after year,’’ said Elumba, who graduated last month.

“In the future, these student athletes could go on to be professional athletes and make money with philanthropy instilled in them.’’

Nonprofit Brands Ranked

Interesting article about national nonprofit branding. As highlighted by Stephanie Strom of the New York Times, the top ten came out as follows:

YMCA

Salvation Army

United Way of America

American Red Cross

Goodwill Industries

Catholic Charities

Habitat for Humanity

American Cancer Society

ARC of the United States

Boys and Girls Clubs

According to the study, few nonprofits question the benefits a strong brand can have for their organizations, yet some are not leveraging their hard-earned halo by translating it into bottom-line benefits.

The American Lung Association, Special Olympics, The Humane Society of the United States and the Make-A-Wish Foundation of America all earned image scores in the top fifth of the list; however, their brand value fell sharply because revenue did not perform at the same level. The result is some of America’s most beloved nonprofit brands may be leaving millions of dollars in unrealized income on the table.

We wonder what the most recognized nonprofit brands are in Northeast Florida?

An Analysis Ranks Brands of Nonprofits

The Y.M.C.A. has the most valuable brand in the nonprofit field, according to an analysis by two marketing companies.

The second-most-valuable brand belongs to the Salvation Army, followed by the United Way of America.

The analysis, by the marketing firm Cone LLC and Intangible Business, a British brand-valuation company, used financial data, projected growth in revenues and a survey of 1,000 Americans to determine the top 100 most valuable nonprofit brand names among organizations providing social, environmental and animal-related services.

“We hope to show what a powerful asset a brand can be to a nonprofit, if it is leveraged properly,” said Alison DaSilva, executive vice president of Cone.

Nonprofits like the United Way and the American Red Cross, whose name was the fourth most valuable on Cone’s list, have made efforts to value their brand names in the past, but the new analysis appears to be the first that applies the same method of measuring that value across many different nonprofits.

The list is likely to interest companies as well as nonprofits and donors, Ms. DaSilva said. Businesses support nonprofits as a way of enhancing their own brands, and nonprofits with the best brand names will have a greater halo effect.

The analysis spotted some interesting things. Environmental groups are the darlings of donors right now and their revenues are among the fastest growing in the sector — but their brand names scored lower values in the Cone research.

“They have spent a lot of time raising awareness of the issues through things like calls to action — put a brick in your toilet, turn out the lights — but not for their brands,” Ms. DaSilva said.

Conversely, she said, the Make-A-Wish Foundation enjoys widespread recognition, but its revenues do not reflect that. “They can capitalize on the brand recognition to increase revenues,” Ms. DaSilva said.

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Are Charities Really Public Money?

John Tyler, secretary and general counsel of the Kauffman Foundation, and Evelyn Brody of the Chicago-Kent College of Law, have collaborated on a monograph titled "How Public Is Private Philanthropy?" Contrary to the popular assumption that governments should exercise tighter control over philanthropy because philanthropic assets are "public money," the authors argue that legal precedents treat charities as private entities with private assets.

Nonprofits Seeking Wealth Management Help More Often

Shelly Banjo writes in this Wall Street Journal article about a new trend where more nonprofits are seeking professional investing advice to preserve their reserves. One might think this is adding kerosene to a fire, but as stewards of their mission, nonprofits must do what is seen as proactive in preserving precious program dollars. Nonprofits should follow guidelines in selecting a wealth manager.

PRACTICE MANAGEMENT:

Charities Turn To Wealth Managers

Wealth managers are seeing increased interest from charities and private foundations that, hit by endowment declines and shaken by prominent fraud cases, are seeking more professional help with investment decisions and due diligence.

Large financial companies including JPMorgan Chase & Co. (JPM), Bank of America Corp. (BAC) and Bank of New York Mellon Corp. (BK) have long served these clients, but say more organizations are turning to them for help.

JPMorgan recently launched the JP Morgan Foundation Research and Investing Center, a group of investment, client, family wealth, philanthropic and tax professionals who meet at least monthly to manage foundation clients' assets and coordinate grant-making execution and tax and administrative services. JPMorgan manages more than $18.3 billion in assets for charitable organizations and works with 60 client foundations.

Based on research and historical analysis of foundation performance and the markets, the center launched a new investment strategy. "Our new approach focuses on a more complete diversification of a portfolio," said Tony Werley, managing director and global head of portfolio construction at JPMorgan. He said it depends less on equities and includes alternative investments and fixed income.

In 2008, foundation assets nationwide dropped about 22%, or almost $150 billion, from a year earlier, according to the Foundation Center, a nonprofit research firm in New York. Squeezed for cash, many foundations were forced to sell assets into a falling market to fund grants and operations. Nearly 150 foundations including the Picower Foundation of Palm Beach, Fla., and the Chais Family Foundation in Encino, Calif., lost millions of dollars due to the Bernard Madoff scandal.

As a direct result, investment-manager turnover could reach historic highs over the course of the next 12 months, according to a survey out Monday by Greenwich Associates, a Stamford, Conn., institutional financial-services research firm.

Two-thirds of U.S. institutions plan to hire a new investment manager in the next year and almost 30% of endowments and foundations plan to fire a manager, the report said.

This is an opportunity for investment managers who can answer to "increased demands for greater transparency, due-diligence practices and demonstrate that appropriate risk controls [are] in place," said Chris McNickle, a managing director at Greenwich Associates.

New Legal Structures Facilitate Social Impact

John Tozzi, who writes for BusinessWeek points out an emerging trend where some nonprofits are turning into for profits to grow through investment, while many for profits are beginning to look like nonprofits when they place mission over money. The once black and white realm of business entities is turning grey.

Turning Nonprofits into For-Profits

New hybrid corporate structures allow nonprofits to accept private investment without diluting their missions

The nonprofit Bikestation reached a crossroads in late 2007. Founded in Long Beach, Calif., in 1996 to design, build, and manage bike transit centers, the 10-employee organization couldn't handle all the calls coming in on its $300,000 budget, funded mostly through earned income. With little grant funding available, the board determined that the best way to meet demand was to raise money from private investors­—which meant turning Bikestation into a for-profit social venture. "We just didn't have the resources to expand the mission and the vision further," says Andréa White-Kjoss, who joined the nonprofit as CEO in 2004.

Social enterprises like Bikestation often don't fit neatly into existing ownership structures. Those that register as nonprofits have trouble tapping private capital to expand, while for-profit companies risk compromising their missions because they must put shareholders' returns first. But growing interest in hybrid business models has spurred recent efforts at the state level to create new corporate structures that allow entrepreneurs to integrate nonfinancial goals into for-profit businesses. "The intentions of entrepreneurs and investors have evolved over time to include a desire to create social value as well as shareholder value," says Jay Coen Gilbert, co-founder of B-Lab, a Berwyn (Pa.) nonprofit that certifies mission-driven companies. "Corporate law has not evolved to serve these new needs."

One new form, known as the Low-profit Limited Liability Company (or L3C), is intended for companies that put their missions before profits. The structure lets them qualify for "program-related investments" from foundations—loans or investments that further a foundation's goals and also may yield financial returns. First adopted in Vermont in April 2008, the L3C is now also on the books in Michigan, Utah, and Wyoming. There are 53 L3Cs in Vermont and a handful in other states so far.

In California a separate effort is under way to take "a holistic approach to the real friction points of trying to meld a social mission and a true capitalistic model of a corporation," says R. Todd Johnson, a partner at Jones Day in Palo Alto. Johnson, along with attorneys Susan Mac Cormac and Derrick Britt, is leading a working group to draft language for the new form and present it to California lawmakers later this year. The rules would address tensions like how to report social impact to shareholders and what happens if the company is acquired or goes public.

"corporate constituency statutes"

For now, however, social ventures must find creative ways to straddle the line between nonprofit and for-profit. At Bikestation, the board decided to form a new for-profit company called Mobis Transportation Alternatives. They incorporated Mobis in mid-2008 and raised $500,000 from angel investors, including the Tech Coast Angels, late last year. Staff members switched to work for the new business, and Mobis licensed the intellectual property from the nonprofit, including the Bikestation name and other proprietary information for creating transit centers. The nonprofit remains essentially a holding company for the intellectual property, though Bikestation plans to use the licensing revenue to make grants. As part of the agreement, the nonprofit got a small ownership stake in the new Bikestation and controls a seat on the board.

Crafting such ad hoc solutions can be unwieldy—and expensive. "We had lawyers for the nonprofit, we had lawyers for the for-profit, we had lawyers for the investment group, says White-Kjoss." Bikestation's officers were careful to get an independent valuation for the intellectual property they licensed to avoid any appearance of self-dealing. In addition, they incorporated the new company in New York rather than California, because New York is one of 31 states with a "corporate constituency statute." Such laws let company leaders consider the interests of other stakeholders—such as employees or the community—in addition to the narrow financial interest of shareholders.

Of course, approaches to business structure vary. Some nonprofits control 100% of the for-profit enterprise. For example, the Mozilla Foundation formed a corporate subsidiary in 2005 to handle the development, marketing, and distribution of the group's open-source software, like Firefox, with revenue flowing to the foundation to support Mozilla's open-source mission. Other models split financial returns with outside investors but retain control of the mission through special classes of stock or other agreements written into the company's governing documents. Lee Zimmerman and Brian Anderluh bought Evergreen Lodge, an historic tourist lodge on the edge of Yosemite, in 2001 with a plan to start a summer jobs program for young adults from the Bay Area. They formed an LLC and raised $15 million in debt and equity from socially minded investors like Pacific Community Ventures and Juma Ventures, both nonprofits.

Zimmerman cautioned investors that returns could be diluted because of the company's social mission to hire disadvantaged youths, but he's not certain they will be. "I think that long term we will be able to fund this program and provide near-identical returns as an entity that didn't have this social program," he says. To reassure investors, however, Evergreen Lodge offered to return the initial capital invested once the company could afford to replace it with debt—which Zimmerman expects to happen in two years. Investors will retain ownership and still receive dividends, but they'll be able to get their original money out without selling the company. Since buying the lodge, Zimmerman and Anderluh have expanded it from 18 cabins to 90 and increased revenue from $500,000 in 2001 to $5 million in 2008.

For Bikestation, the for-profit model is paying off as well. The new company has increased staff from 10 to 14 and is helping to open four new transit hubs this year, bringing the total to 16. Bikestation won't disclose revenue, but White-Kjoss says it has raised projections for 2009. The company is expanding beyond its traditional customers—cities and transit agencies—to market to universities, corporate campuses, and other developments. "We're able to do what we've been wanting to do for a long time," says White-Kjoss.

The Nonprofit Good Practice Guide: Invaluable Nonprofit Asset

The Nonprofit Good Practice Guide is one of our favorite nonprofit Internet resources, and we use it all the time at the Small Business Development Center at the University of North Florida. It is a helpful tool in our work with nonprofits.

The site itself was created in 2002 with the goal of capturing, organizing, disseminating and promoting the use of knowledge in the nonprofit sector. It is founded by the Johnson Center at Grand Valley State University in Michigan. It serves as a clearinghouse for articles about a wide array of nonprofit topics such as:

• Advocacy and Lobbying
• Evaluation
• Financial Management
• Fundraising
• Governance
• Human Resources
• Information Management
• Legal and Regulatory
• Marketing and Public Relations
• Nonprofit Basics
• Nonprofit Data and Statistics
• Organizational Planning and Management
• Volunteerism

The article resources run deep. For example, the fundraising category has over 300 articles to peruse on the topic.

In addition to the library, there is an excellent searchable nonprofit glossary of common terms used in the nonprofit sector. A search under "IRS 501", yielded 69 results. Related terms and resources are listed with the definitions whenever appropriate.

While taking graduate classes in nonprofit management, we used The Nonprofit Best Practices Guide to find a logic model for writing a grant. The site provided a complete guide to the concept as well as outstanding examples for our use.

The Nonprofit Good Practice Guide should be bookmarked as a web favorite by every nonprofit manager in the country.

You can find their facebook fan page here.

Charitable Giving in 2008 Better Than Expected

Shelly Banjo writes in the Wall Street Journal that perhaps charitable giving did not fall off to the extent predicted in 2008.

GETTING PERSONAL:Charity Declines In 08 Less Dire Than Feared

Were doomsday scenarios predicting a 10% to 30% plunge in charitable giving a bit too extreme?

New totals for 2008 suggest those dire predictions were exaggerated, although the recession's full impact on philanthropy may yet to be felt.

Charitable giving dropped about 2% from a year earlier, or 5.7% in inflation-adjusted dollars in 2008, according to the annual Giving USA study released Wednesday. As a measure of gross domestic product, giving is still historically strong: The roughly $308 billion in charitable gifts was 2.2% of GDP, down slightly from 2.3% in 2007.

Still, it was the first decline since 1987 and the second since the group began tracking charitable donations in 1956. Gifts to private foundations fell by 19.2% and at many charities, donations weren't enough to replace funds lost by deep endowment declines and financial scandals.

The study doesn't break out quarterly results but anecdotal evidence suggests three quarters of strong growth in early 2008 may have propped up a dismal fourth quarter, said Nancy Raybin, chair of the Giving Institute. Deeper cuts of the recession, including job losses, auto company bankruptcies and the Bernie Madoff scandal, haven't been factored in.

"This is a snapshot in time, clearly the full impact of the economic downturn won't be reflected until 2010 and 2011," said Claire Costello, national practice executive for philanthropic management at Bank of America Corp. (BAC).

Giving was down across most sectors apart from religious organizations (up 5.5%), public and society benefit organizations, which include donor-advised funds and voter-registration groups (up 5.4%), and international affairs nonprofits (up .6%).

"Wealth drives giving - if people feel pessimistic about the future or lose jobs they aren't going to maintain the same level. People still give, they just give less," Raybin said.

Financial advisers say they're having more conversations with philanthropic families around how to continue to make an impact on a tighter budget. Donors are focusing on specific charities, doing more due diligence on charities, extending grant terms to existing pledges, and are setting expiration dates on foundations to allow for more immediate spending.

Families are realizing these are no longer "flush times where they can haphazardly give a little here and there" if they're going to make an impact - they're seeing it's time to get focused and do some planning, said Lisa Philp, head of philanthropic services at JP Morgan Private Bank.

"Financial advisers can help families shore up what core issues and organizations they care about most and focus on helping them make it through challenging times," Philp said.

What Kind of Nonprofit are You?

Scott Russell of MinnPost.com wrote this article that got our attention. Jon Pratt and Jodi Sanfort really nailed these nonprofit characterizations!

The 3 types of nonprofits: velociraptors, tickbirds, viruses

The nonprofit world divides up into three organizational types: the velociraptor, the tickbird and the virus. (Hey, I'm not making this up. This is according to Jon Pratt, executive director of the Minnesota Council of Nonprofits (MCN) and Jodi Sandfort, associate professor at the Humphrey Institute of Public Affairs.)

The velociraptor (the small, meat-eating dinosaur made famous in "Jurassic Park") is the entrepreneur. It's nimble, competitive, sees potential and acts quickly.

The tickbird (a bug-eating bird that has a symbiotic relationship with rhinos) could also be called a subcontractor. It's symbiotic with government: It gets government grants, follows government rules and implements government policies.

The virus is the networker. It moves easily person to person and finds strength in numbers (and gets money from long-term trusting relationships).

Pratt and Sandfort presented this entertaining model last week at MCN's conference "Practical Leadership: A Balanced Approach." Thursday's daylong conference drew hundreds of participants, and they needed a laugh.

Many face tight budgets and growing service demands and worry about upcoming state government unallotments. The conference offered them workshops on everything from "conflict fluency" to stress reducers such as "leadership balance through yoga."

Pratt and Sandfort said nonprofits tend to blend velociraptor, tickbird and virus approaches. They used the framework to talk about how conflicts arise within and between nonprofit organizations because of different organizational goals. Bottom line, Pratt and Sandfort preferred the virus, or networking, model.

In an interview, Pratt said nonprofits face pressure to choose strategies to get the greatest financial return — which may not be the same thing as addressing the greatest community need.

Nonprofits can use their networks and engage with people locally, "to counterbalance some pressures that may make them look more like Blockbuster Video than a community organization," he said.

Nonprofit Social Media

From the Cleveland Plain Dealer's Trevor Hunnicutt comes this article about nonprofits utilizing social media. In Northeast Florida, this is a hot topic and local nonprofits are using social media to tell their stories and create awareness.

Nonprofits turn to Facebook, MySpace, Twitter to raise money, market themselves

Nonprofit and philanthropic organizations are turning to relatively cheap online social media to raise money and market their organizations as they grapple with recession-battered endowments, fewer grants and, often, less patronage by their customers.

"I see many layers of advantages to using these social networks," said Jim Kopniske of the Cleveland Museum of Art. He is one of four people responsible for updating the museum's Facebook, MySpace and Twitter pages, as well as maintaining a blog.

"It's a small piece, but it's steadily growing," he said. "The only cost of it is our time."

This week, the Cuyahoga Valley National Park Association announced the launch of a Web site that allows patrons to sponsor acres of parkland. For a tax-deductible $75, donors choose an acre to sponsor on ParkShares.org and register it for a year.

The site allows users to create a profile of their acre with pictures, information about the park and a personal blog that can be shared with others. The donation supports the association, a nonprofit organization that develops park-oriented educational and cultural programming.

The park association said the site has been in development for years and is not a response to the recession. Still, the group's grants are down about 50 percent from last year, so it is looking for new money to plug the gap, spokeswoman Jocelyn Buckey said.

Most nonprofits tap into existing social-media networks rather than create new ones, as the park association did. Those include Twitter, the micro-blogging Web site that distributes users' casually short messages, or tweets, to computers and cell phones, and Facebook, with millions of users.

Organizations use both to drum up interest in their organizations, communicate with patrons and promote specific events.

Even as social networks gain popularity, most nonprofit organizations have yet to tap into them as a significant source of money. Only about 1 percent of nonprofits raised more than $10,000 using Facebook, according to a survey released last month by the Nonprofit Technology Network, a group that represents technology employees in nonprofits.

Some of Cleveland's biggest nonprofits do not use social networks at all, and many organizations that embraced the technology are using them for communication, not fund-raising. PlayhouseSquare and the Cleveland Museum of Art are among the organizations using the technology more to promote their broad-based recreational appeal than to raise money.

But many nonprofits say that even if they have not found a direct stream of revenue from their efforts online, there is a strong connection between marketing themselves online and raising money.

"We're researching best practices as far as how to use social media," said Karen Pozna, a spokeswoman for the Cleveland Foodbank, which has a presence on Facebook and Twitter. "When you educate people about your organization, ideally they would turn into donors."

Nonprofits Running Government Services: Fire and Forget?

Steve Patterson offers this Times-Union article discussing the trend of nonprofits taking over city run community centers. This is an approach that is not limited to Jacksonville. Privitizing city services by moving them to the nonprofit sector is quite common. The problem is, some nonprofits are not ready to take on the responsibilities and the government tends to look the other way after the hand off. Successful nonprofit ventures of this sort require continued local government support in the form of training and appropriate funding. 

Ian Greene,  a York University professor, argues that there are five essential conditions for successful nonprofit delivery of city services: the capacity of the nonprofit to host a quality board of directors,staff and executive director, adequate training for the board;fair funding for the nonprofits;open lines of communication through effective liaison committees, and effective oversight by government funding authirities to prevent the malfunction of nonprofit agencies delivering services.

Jacksonville taps nonprofits to run neighborhood centers

Sirretta Williams, a church pastor, went to a community center thinking she might volunteer there. She ended up volunteering to run the place.

Last week,  Jacksonville’s City Council voted to lease the Joseph Lee Community Center to Williams’ Lion of the Tribe of Judah Ministries for 10 years. After renovations to the center on Perry Street, a few blocks from the Gateway Mall, church volunteers plan to tutor kids and teach them music, tae kwon do and financial skills.

With governments short on cash, “this is the time where the religious sector and the community and businesses are going to have to come together and help,” Williams said.

City Hall couldn’t agree more.

By summer, the city wants to finalize deals for three other nonprofits to run community centers in Arlington, the Southside and Northwest Jacksonville.

Others are already up and running.

Those arrangements are part of a city push to remake centers that are under-used — often closed — into sources for youth programs and services the city’s budget doesn’t cover.

“With community centers closed, that’s not a good sign for the youth,” said Pam Wilson, marketing and community relations manager for the city’s parks.

Money from the Jacksonville Journey anti-crime effort is helping make deals happen.

Nonprofits invited to bid on running six centers were offered up to $100,000 apiece for repairs and improvements to the buildings, which are often a few decades old. A similar deal was made with Williams’ church, which was already asking about operating the Lee Center.

During a 2007 venture into private management, a loose agreement between the city and a group that wanted to run a center on Moncrief Road prompted questions about how much the deal would really benefit the surrounding neighborhood.

That deal, with a foundation launched by former Jaguar Tony Boselli, was eventually retooled and the same foundation later set up programs at a second center, on East 23rd Street. The second center opened last summer.

The city’s approach to management deals has become more formal. The three agreements pending now are with nonprofits who answered a public notice inviting bids to operate closed centers.

Besides showing insurance and tax-status records, their applications outlined the five-day-a-week children’s programs they would offer, staffing ratios, public-access rules and optional adult programming.

Children could only be required to pay for services if the city collects similar payments at other parks — for example, for summer camps.

Bidders had to find their own ways to finance day-to-day operations.

Seven centers were targeted for private partnerships as part of the Jacksonville Journey’s push to keep young people busy and out of trouble.

The first of those, at Normandy Park on the Westside, reopened in April under the management of Community Connections, a social service nonprofit with a long track record locally.

The organization wanted a new Westside location where it could move a youth program formerly based at an apartment complex, and Councilman Daniel Davis steered them to the parks department, said Pat Hannan, the nonprofit’s executive director. The Normandy center, which had been vandalized by spray paint, was undersized and needed updating.

Builders Care, a charity operated by the Northeast Florida Builders Association, lined up contractors who more than doubled the size of the community center, Hannan said.

About 120 children now use the upgraded center, which will start offering summer camp next month, she said. Money the group already received under a separate deal from the Jacksonville Children’s Commission pays part of the operating cost, with the rest coming from private sources, Hammond said.

One of the sites targeted for partnerships, in Arlington’s Fort Caroline area, was scratched from the list because of neighborhood opposition.

A series of neighborhood meetings and a public bid process brought responses from groups wanting to operate three of the five other closed centers — in St. Nicholas, the College Park area in Northwest Jacksonville, and off Merrill Road in Arlington.

All of those offers involve nonprofits that already work with people in surrounding neighborhoods, Wilson said.