Nonprofit news roundup for April 8, 2009

Tensions grow between NPR, member stations

Friction is rising between National Public Radio and some member stations because of cutbacks and budget worries at the Washington, D.C.-based network, The Wall Street Journal reported April 8 (see public radio story). Some stations fear erosion in the quality of well-known NPR programming could make it harder for them to raise funds during those NPR shows, and that NPR will grab most online listeners, leaving fewer for local stations’ Web sites. Fueling the fire was a suggestion by NPR correspondent Susan Stamberg and “All Things Considered” co-host Melissa Block that member stations hold fund drives directly for NPR.

Madoff fraud underscores need for boards to do better job

Nonprofits were particularly susceptible to the sort of fraud committed by Bernard Madoff, New York Attorney General Andrew Cuomo said in a fraud charge he filed Monday against J. Ezra Merkin, former GMAC Financial Services Chairman, who Cuomo alleges was a middleman for the convicted Madoff, The Wall Street Journal reported April 6. The charge underscores the risk to charities if they ignore governance practices and conflicts of interest, like investing with businesses run by board members, the Journal says. Big losses to charities that invested through Merkin show how boards fell down on the job, the Journal says.

Princeton endowment losing value; budget cuts planned

The student newspaper at Princeton University reports the school’s president says the value of Princeton’s endowment will fall 30 percent by the end of this fiscal year, resulting in $88 million in cuts to next year’s budget, the Star-Ledger in Newark, N.J., reported April 7 (see college endowment story). Shirley Tilghman, Princeton’s president, told the campus community in an e-mail that the value of the endowment would drop to roughly $11.5 billion by June 30 from $16.4 billion a year earlier, and that the university will cut 6.8 percent from its $1.3 billion operating budget for the fiscal year that starts July 1.

Shutdown sought of nonprofit former state senator founded

Pennsylvania’s attorney general filed legal papers seeking to close a nonprofit founded by a former state senator convicted of using the organization’s money for personal benefit, the Associated Press reported April 7. The civil suit filed by Attorney General Tom Corbett seeks a complete accounting of the assets of Citizens’ Alliance for Better Neighborhoods, a Philadelphia nonprofit founded by former Sen. Vincent Fumo, as well as repayment of assets found to have been wasted, mismanaged or misappropriated.

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