Nonprofit news roundup – Week of 10.08.07

‘Orphan’ trusts veer from mission; government forgives student loans for public service; U.S. food aid faces crisis; and more.

* “Orphan” trusts and foundations, left by a donor’s death to the discretion of local banks or law firms, often end up veering considerably from their founders’ wishes, the New York Times reported Sept. 29. In such trusts, giving often decreases even as assets increase, resulting in larger bank fees, and grants frequently serve the interests and alma maters of corporate trustees, whose firms get credit for the gifts from trusts they manage.

* A new law signed by President Bush forgives students loans for public-service employees who have made 10 years of payments on their education debt, the Washington Post reported Sept. 28. The benefit applies to employees working in government, public education and libraries, public-interest law, and certain areas of social work, as well as some nonprofit groups and full-time faculty at tribal universities or colleges.

* The purchasing power of the U.S. food-aid budget has been cut roughly in half by escalating purchase and shipping costs from 5.3 million metric tons in 2000 to only 2.4 million this year, leaving food-aid groups debating how best to use diminishing food stocks, the New York Times reported Oct. 3. Recent Department of Agriculture data show costs have risen 35 percent in 2006-07 and the agency predicts a further 35 percent increase in the next two years.

* Freedom’s Watch, a new Washington D.C. advocacy group, aims to be a conservative powerhouse in supporting such causes as troop proliferation in Iraq and a more aggressive policy towards Iran, the New York Times reported Sept. 30. Calling itself an answer to liberal grassroots movement, the organization is fronted by a smattering of extremely wealthy and influential donors, including casino mogul Sheldon D. Adelson, and former White House officials Ari Fleischer and Bradley Blakeman, who now serves as Freedom’s Watch president.

* After a 10-month delay, the Smithsonian Institution will launch its new TV channel as part of a joint venture with Showtime Networks and DirecTV, the Associated Press reported Sept. 24. The 30-year contract with Showtime, an agreement causing some scholars to worry about restricted access to Smithsonian archives, was pursued in part to offset a $2.5 billion backlog in maintenance needs at the Institution’s museums.

* The U.S. Department of Homeland Security has given out more than $24 million in funds for security training and screening equipment to 308 nonprofits it considers at high risk of terrorist attack, most of them Jewish, the Associated Press reported Sept. 28. The program awarded its first round of grants in 2005.

* Tania Head, who says she is a 9/11 survivor, has refused interviews with the New York Times and hired a lawyer, leading to speculation that her story, which would have made her one of only 19 survivors to have escaped from the World Trade Center at or above the point of impact, may not be true, the Times reported Sept. 27. Head served as president of the World Trade Center Survivors’ Network, a nonprofit support group, and was a frequent tour guide at ground zero’s Tribute W.T.C. Visitor Center; both organizations have since ended their association with Head.

* California real estate developer Richard Lundquist and wife Melanie are donating $50 million to Los Angeles Mayor Antonio Villaraigosa’s Partnership for Los Angeles Schools, the Los Angeles Times reported Sept. 27. Villaraigosa says this is the beginning of a broad fundraising campaign to finance the program, open by vote to all California schools, which drew controversy when Villaraigosa tried to gain direct influence over the school system through the state legislature.

* Michigan charities are rethinking the way they raise money as struggles in the auto industry produce a statewide downturn in corporate giving, the Detroit Free Press reported Sept. 23.  Corporate philanthropy throughout the U.S. hit a record low last year, at 0.7 percent of pre-tax profits, forcing charities such as the United Way to narrow their focus both in fundraising and program implementation in an effort to appear more accountable to potential donors.

* Commonwealth Research Institute, a Johnstown, Penna., nonprofit that does intelligence and surveillance work for the federal government, has drawn scrutiny over a contract awarded to Charles D. Riechers last year while he awaited confirmation to a top civilian post in the Air Force, the Washington Post reported Oct. 1. The arrangement, in which Riechers received a paycheck from Commonwealth but never did any work for the group, may have violated Air Force regulations and has caused some to question its tax-exempt status.

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