[Editor’s note: A longer version of this column was published in The Chronicle of Philanthropy]
Before the Nov. 4 elections, nonprofit leaders were discussing ways to tighten the relationship between government and charities.
Those conversations focused on the need for additional federal money for nonprofits and a substantial expansion of national-service opportunities.
And some nonprofit officials are pressing President-elect Barack Obama to seek to steer money to innovative programs that want to spread their approaches nationwide, and to finance programs that train charities to do a better job of managing their operations.
In times of financial hardship, nonprofit groups are desperately looking for new sources of financing, so it is to be expected that their attention and focus should be on more dollars.
But nonprofit groups also need to put other issues on Obama’s agenda, including assuring the accountability of the nonprofit world, tightening federal rules for foundations, and determining how much federal support should be given to religious charities.
What’s more, any effort to help nonprofit groups should be shaped by the pressures facing groups that focus on key issues such as housing the poor, feeding the hungry, training low-income people to gain useful job skills, and spurring community development.
Many of the government programs that support such efforts have been seriously underfinanced in recent years, while others simply do not work well.
The challenge for the Obama administration will be to determine which programs deserve more money, then decide whether that support should come either directly from the federal government or by passing tax incentives and undertaking other efforts to press private sources to supply the dollars.
While organizations pushing entrepreneurial approaches for charities seemed to catch the most attention from the candidates, especially Obama, he will have to devote his attention to helping charities carry out essential services and advocacy work – especially as the economy’s challenges take a bigger and bigger share of the money in government coffers.
He also will need to decide what non-monetary roles government should play to support nonprofit groups.
The federal government’s relations with charities and foundations will not always be a “love-in”; nonprofit groups have the obligation to monitor, criticize and, at times, oppose government efforts that are considered inappropriate or inadequate.
The following are some key priorities that will enable charities, foundations and government to make a real difference in the Obama administration:
* Create a White House office for nonprofit organizations. The office could be the major liaison between the administration, charities and foundations, and would promote national service and volunteering, help coordinate government programs that benefit nonprofit groups, and assist the IRS in guaranteeing nonprofit groups are accountable.
* Overhaul the operations of the Corporation for National and Community Service, which will administer the expanded national-service programs Obama proposed during the campaign. The corporation’s governance system needs to be restructured immediately. The great majority of its board should be independent, non-political appointments, people with experience and expertise in stimulating public service, civic engagement and volunteerism. And the current policy that prohibits volunteers in AmeriCorps, Vista and other federal programs from engaging in advocacy efforts or activism should be revoked so they can participate in the full range of activities citizens are afforded in our democracy.
* Spend money to spur nonprofit innovation and expand charity operations. Little, if any, federal money is available for new or innovative efforts by nonprofit groups. A relatively small amount – up to $250-million a year – could be reserved for this purpose in the budget of the Corporation for National and Community Service.
* Force foundations to give more. While the federal government needs to increase its support of nonprofit groups, foundations also have an obligation to do much more than they have in recent years. The Obama administration should serve as a bully pulpit to persuade foundations and corporations to increase their support of nonprofit groups and provide a greater share of their grants to innovative and more risk-taking programs. It should demand with the help of Congress to increase the minimum payout rate to 6 percent in grants.
* Promote accountability at nonprofit organizations. The continuing scandals at charities and foundations can no longer be tolerated; they are undermining the integrity and good works of the nonprofit world.
Tougher regulations are needed to eliminate excessive compensation and end the cozy sweetheart deals for people affiliated with foundations. Greater oversight and enforcement by the IRS and state attorneys general are the key to better accountability.
* Maintain a strong advocacy role. Nonprofits themselves also have responsibilities as a new administration takes office. It is all too easy for nonprofits, especially those sympathetic to Obama, to forget that one of the important missions of nonprofits is to hold any administration and the federal government accountable and to fight against programs they deem harmful to their constituents.
President-elect Obama’s transition team should be meeting with representatives of nonprofit groups. Those meetings must not be limited to the usual organizations and coalition groups that have had access to the White House in the past, or who now have an inside track to whoever wins the election.
Many of these groups do not speak for the nonprofit world as a whole. The outreach by the White House to nonprofits should be much broader and more extensive than it has been in the past.
Only in this way will the Obama administration get a real feel for what is needed by nonprofit groups and for what they could do to improve their performance.
Pablo Eisenberg is senior fellow at the Georgetown University Public Policy Institute.