By Kris Hermanns
Executive Director
Pride Foundation

Each year Philanthropy Northwest and a group of our member grantmakers travel to Washington, D.C., to share our views on the latest charitable legislation. Attendees have the opportunity to develop and grow relationships with Members of Congress, who are most influenced when constituents from their states or districts advance a cause on behalf of themselves and their national organizations. This year, a number of funders that are based in or support causes in Montana attended, including representatives from Dennis & Phyllis Washington Foundation, M.J. Murdock Charitable Trust, Northwest Area Foundation, and Pride Foundation.

Kris Hermanns

I was fortunate to be invited to Foundations on the Hill last March, an event coordinated by the Council on Foundations and the Forum of Regional Associations of Grantmakers, which includes our own Philanthropy Northwest. The two-day program came as the U.S. Senate was debating and voting on the FY2013 Continuing Resolution to prevent the government from shutting down one week later. It was also a timely opportunity to be in our nation’s capital because of the growing chorus calling for serious tax reform. Senator Max Baucus (D-Montana), Chair of the Senate Committee on Finance, is heading this effort.

Changes in the tax code could include eliminating or restricting charitable tax deductions. While different scenarios are being hashed out, one thing we do know is if we create disincentives for people to donate to charity, it will seriously affect the lives of economically vulnerable people who count on nonprofit groups to provide a safety net for themselves and their families.

The nonprofit sector is a critical component of the U.S. economy that deserves to be protected. The Urban Institute projects that nonprofits generate more than $1 trillion every year through jobs and services, including employing 10 percent of the workforce. And according to Giving USA, individuals donated nearly $300 billion to charitable causes in 2011. It is also important to state the obvious—since the onset of the Great Recession, many nonprofits have been asked to do more with less. If the charitable deduction is reduced and the government simultaneously continues to cut back the services it provides, all of us worry about the deep and long-term consequences that will impact our communities.

It was in this context that I, along with other colleagues from the sector, met with many members of our congressional delegation and their staff, sharing stories of how the charitable deduction positively impacts nonprofits. Since Pride Foundation works across five Northwest states, I was able to meet with the Chiefs of Staff for Sen. Baucus and Sen. John Tester (D-Montana) as well as Sen. Tester himself, along with his Senior Economic Advisor. I also met with Sen. Patty Murray (D-Washington) and her staff, Sen. Maria Cantwell (D-Washington), and a legislative assistant for Sen. Mike Crapo (R-Idaho). Many of us also had the chance to meet with the Chief Tax Counsel to the U.S. Senate Committee on Finance, who is gathering input and feedback from various constituencies who will likely be impacted by tax reform.

During these meetings, we emphasized how community groups are continuing to find innovative solutions to long-standing challenges, filling voids created by government cutbacks, and providing critical and essential services in our communities. We discussed how the charitable tax deduction is unique among all other deductions because it does not solely benefit the individual taxpayer – it provides essential financial support to every nonprofit in this country; we should be creating more incentives for people to give, not fewer.

One of the highlights of the trip for me was when Sen. Tester stopped by on his way to the Senate Floor to vote on the Continuing Resolution. A few of us were meeting with his Senior Economic Advisor, Alison O’Donnell. When I introduced myself, he immediately recognized Pride Foundation’s name, and said that he knew of our good work and appreciated all that we were doing.

I am grateful for the time the Senators and their staff gave to us as well as their willingness to listen to our hopes for further strengthening the philanthropic and nonprofit sectors in our region. I walked away with a strong sense that the Northwest is blessed to have such a respected and powerful congressional delegation.

This post is part of Northwest Area Foundation’s (NWAF) Giving Voice series. The content originally appeared on the NWAF website and has been re-posted here with their permission.

By Kevin Walker
President and CEO
Northwest Area Foundation

I spent the first day of spring 2013 fast-walking Capitol Hill with foundation colleagues from all across the country. Hundreds of us were there for Foundations on the Hill, philanthropy’s annual push to remind lawmakers why giving matters.

In brief encounters with our elected officials and their staff, we tried to connect the dots between their priorities and ours. We reminded them of the essential work our grantees are doing every day to make communities better, to make our nation stronger and more just.

The best Foundations on the Hill moments come when you find yourself sitting across a small table from a United States senator as she nods and says, “Exactly. I know. I’m with you. Tell me what I can do to help.”

The funniest moments come when you realize the junior staffer who’s been tapped to meet with you doesn’t actually know what a foundation is. He blinks and asks, “So, foundations – is that the construction industry then?“ I am a great believer in the value of humbling experiences. Foundations on the Hill is good that way.

Most of the years I’ve done this, we’ve put forward a number of talking points on policies to protect and enhance philanthropy. This year, though, as deficit reduction and tax reform dominate the national discourse, the Council on Foundations and its Foundations on the Hill co-sponsors urged us to focus on one single point: preservation of the charitable deduction in the tax code.

The charitable deduction works roughly like this. If you give $100 to a charitable organization and itemize that gift on your tax return, your taxable income is reduced by that $100. If you pay federal income tax at the 25 percent rate, you pay $25 less in tax that year. If you pay at the highest rate, which is now 39.6 percent, you pay $39.60 less. So the deduction provides a larger savings to wealthier taxpayers. That fact has led to repeated proposals by the current administration to cap the deduction at 28 percent, as a way to make sure more revenue remains subject to taxation at the highest level. In other words, a $100 gift from a taxpayer in the 39.6 percent tax bracket would reduce the giver’s taxable income not by $39.60, but by $28. The notion is that such a cap will bring desperately needed funds into the treasury in a way that wealthier donors can easily afford.

This sounds good – but credible research suggests the change would drive down charitable giving. The negative impact on the nonprofit sector could be massive – on the order of $5.6 billion in yearly donations that would dry up. The Charitable Giving Coalition points out that this is more than the annual budgets of the American Red Cross, Goodwill Industries International, YMCA of the USA, Habitat for Humanity, Boys & Girls Clubs of America, Catholic Charities USA, and the American Cancer Society combined.[i]

This loss of resources, which would be felt by nonprofits already hit hard by the Great Recession, is unacceptable. Our charitable institutions and the communities they serve simply cannot afford a deficit solution that drives down charitable giving.

I also came away from Foundations on the Hill with a sharpened sense of why this idea is not just alarming in practice, but flawed in theory, too. Ever since its creation a century ago, the charitable deduction has enshrined in the tax code a quintessentially American idea: that charitable giving – neighbor helping neighbor, citizens organizing their own institutions and supporting them ourselves – comes before our obligation to fund Uncle Sam. That’s why the deduction operates by reducing taxable income. The money my family chooses to give to the local food shelf, or our public radio station, or the Red Cross – we have invested that money in the common good rather than saving or spending it ourselves. It should not be subject to government intervention, including the government’s taxing authority.[ii]

We in the social sector should embrace the challenge of meeting our nation’s fiscal challenges. We should offer our help and our best thinking. But if we accept the idea that a charitable deduction capped at 28 percent is good enough, then we accept that the government comes first. In this country, the people come first, not our government. We, the people, give generously to the community organizations we care about. The tax deduction for those gifts has endured through many crises, including two world wars and the Great Depression. Lawmakers who assert that today’s challenges are graver than those, and that therefore we must weaken this provision, should look elsewhere for the revenue we need.

By Mindie Reule
Program Manager, Public Policy
Philanthropy Northwest

Last week a delegation of 17 staff and members of Philanthropy Northwest traveled to Washington, D.C. for Foundations on the Hill. Joined in Washington by 300 fellow foundations and regional associations from across the country, our delegation met with 25 members of Congress from the Northwest over three days, plus staff from the Senate Finance Committee, House Ways and Means Committee, and five federal agencies for a total of 32 meetings.

My blog post from last week highlights the talking points our delegation planned to cover, which included the importance of giving to communities in the Northwest and the critical role of nonprofits in our society.

It’s difficult to summarize what was shared in 32 separate meetings. However, we heard general support for our sector from both Republicans and Democrats, and recognition of the importance of philanthropy and nonprofits to our communities and civil society. We also know that members of Congress and their staff on both the House and Senate are working on tax reform this year—and tax policy that affects foundations and nonprofits has and will be part of those conversations.

As mentioned in earlier blog posts here and here, the House Ways and Means Committee held a hearing on tax reform and the charitable deduction and has created 11 working groups on different aspects of reform. Representative Dave Reichert from Washington State is leading the working group on exempt and charitable organizations and The Chronicle of Philanthropy recently ran an article about Congressman Reichert where he shared his goals for the workgroup and his own views on the charitable sector.

“Charitable organizations are vital to the success of many in our society. They provide opportunities for training, education, counseling, housing, jobs, health care, and the list goes on. They also encourage our communities to get involved, to recognize the needs of the neighbors, and then take action. They bring our neighborhood families closer.”

If you would like to make public comments to the work group on charitable and exempt organizations, you can find instructions here.

We also met with staff from the Senate Finance Committee and learned the committee will be reviewing eight or nine option papers related to different aspects of the tax code. The first paper has already been posted here. The paper related to nonprofits and foundations will be available in April. We hear the Senate Finance Committee will be examining giving incentives (asking themselves if there is a better option than the current charitable deduction) and strategies to simplify the tax code. The committee will also be looking at non-cash contributions and valuation, the unrelated business income tax, and commercial activity of nonprofits.

If you have any thoughts about giving incentives or ways to simplify the tax code for foundations and nonprofits, now is the time to contact your elected officials. All Philanthropy Northwest states, with the exception of Alaska, have a Senator on the Finance Committee. Email me if you would like Philanthropy Northwest’s assistance in creating a statement to your members of Congress.

Philanthropy Northwest has a great deal of follow-up to do and will continue to meet with elected officials and their staff members back in their districts as well.

Philanthropy Northwest Deputy Director David Landers had the opportunity to inform Alaska members of Congress that our Annual Conference will be coming to Juneau this fall. They all seemed excited to show off Alaska to foundations from across the Northwest!

Thanks again to the amazing group of members that went with us to D.C.:

• Don Andre and Donald Chamberlain, Campion Foundation
• Mike Halligan, Dennis & Phyllis Washington Foundation (Public Policy Committee Chair)
• Kris Hermanns, Pride Foundation
• Jeff Jessee, Alaska Mental Health Trust Authority
• Diane Kaplan, Jordan Marshall, and Aleesha Townes-Bain, Ramuson Foundation
• Lawson Knight, Blue Mountain Community Foundation
• Steve Moore and Jill Tatum, M.J. Murdock Charitable Trust
• Adrienne Quinn and Piper Henry Keller, Medina Foundation
• Kevin Walker, Northwest Area Foundation
• Candace Winkler, Alaska Community Foundation
• David Landers and Mindie Reule, Philanthropy Northwest

This post is the first in Northwest Area Foundation’s (NWAF) Giving Voice series. The content originally appeared on the NWAF website and has been re-posted here with their permission.

By Kevin Walker
President and CEO
Northwest Area Foundation

“Call us Invisible Americans.”

That’s what Darrell Robes Kipp, a Northwest Area Foundation board member, says when people ask him for help with terminology. Is the right term for his people “American Indians,” “Native Americans,” “First Nations,” or what? “Call us Invisible Americans,” he likes to reply, because Native people are so often absent from official statistics and from the national discourse.

The Obama White House has hosted annual Tribal Nations Conferences at which he meets on a government-to-government basis with the leaders of the 566 federally recognized Tribes. He has expressed hope that his presidency will be a “turning point…when we began to build a strong middle class in Indian Country,” and his first-term accomplishments were historic. Among the highlights were two landmark legal settlements. The $3.4 billion settlement in Cobell vs. Salazar brought resolution to a 14-year legal battle based on decades of U.S. government mismanagement of Native trust funds. The $760 million settlement in the case of Keepseagle vs. Vilsack brought a degree of closure to generations of discrimination against Native farmers and ranchers by the U.S. Department of Agriculture.

It is also noteworthy that the Boys and Girls Club of the Northern Cheyenne Nation in Montana received a Promise Neighborhoods planning grant through the Department of Education, and several reservation communities have been funded through the U.S. Department of Housing and Urban Development’s Sustainable Communities program. In a speech in December, the President specifically singled out our colleague Nick Tilsen of Thunder Valley Community Development Corporation on the Pine Ridge Indian reservation in South Dakota as an example of the dynamism of Indian Country. These are exciting developments.

So – Invisible no more? Let’s not claim victory just yet. There are negatives as well. As crime rates on reservations have surged, federal spending on law enforcement in Indian Country has declined. And of course, crime is not the only scourge afflicting reservation communities. Deep poverty is often a fact of life. Of the 20 poorest counties in the United States, 10 – and four of the poorest five – include Indian reservations.  In urban areas, the Native population is often the poorest and most challenged demographic group. Every on-ramp to prosperity in this country – public safety, quality education, decent housing, job opportunities, and mainstream financial services – remains unjustly difficult for Native people to access.

The President knows these things, and his first term indicates he’s interested in fostering real change. In fact, the record suggests the Obama administration shares the Northwest Area Foundation’s view that the future of Indian Country is not a problem to be solved, but an opportunity to be nurtured. When we look to Indian Country, we see:

• Thousands of Native professionals who are now teachers, bankers, construction workers, and lawyers, as well as doctors and nurses in urban and rural communities.
• Native Americans serving in our armed forces at the highest per capita rate of any population group in the country.
• A generation of young people whose talent waiting to be unleashed.
• Natural resources that could be developed in sustainable ways to strengthen reservation communities.
• Underdeveloped economies that can blossom if new opportunity structures can be created.

These profound assets are also part of the story of Indian Country. Those of us dedicated to advancing prosperity in Native America have an obligation to leverage this administration’s good intentions and make the next four years count. In that spirit, I’ve spent some time in the run-up to Inauguration Day asking Native friends and colleagues what they would like to see from the second Obama administration. Here’s some of what I heard:

Kevin Killer is a young leader from the Pine Ridge reservation in South Dakota. He runs the Native Youth Leadership Alliance (NYLA) and serves in the South Dakota legislature.  Kevin writes, “I am hopeful President Obama’s administration will increase funding tribal colleges, specifically towards workforce and eco-energy programs. Tribal colleges are already leading in eco-innovation such as clean energy in the Dakotas and natural resource management in the Northwest.  A great example of this is 24-year old Salish Kootenai College student and NYLA Fellow Burdette Birdinground, who helped create a portable kiln to utilize wood waste (slash piles) by converting it into biochar which is also a great soil fertilizer. These new and emerging fields have the potential to revitalize as well as build rural and reservation economies into world-class research areas. Native communities in the U.S. have the longest histories with the natural resources in our country. Investing in young leaders at tribal colleges will ensure this cultural capital is preserved and carried forward in this new economy.”

Cheryl Crazy Bull, president and CEO of the American Indian College Fund, also stresses the vital importance of tribal colleges, but she places support for these institutions within a broader context of lifelong educational opportunity. Dr. Crazy Bull lists three priorities: “1.) Adequate programming support for innovative and sustained approaches to early childhood and primary school-age children’s health, literacy, and education – I am deeply alarmed at the extent to which our youngest citizens are not receiving the type of loving care and support that is so much a part of the traditional family life that our people had.  We knew that to prepare our youngest children to thrive and prosper meant caring for their physical, emotional and spiritual health. 2.) Adolescent programming that focuses on transitioning young people from childhood into young adulthood – the Lakota had four stages of life – infancy, youth, young adulthood and old age.  We had deliberate approaches to teaching our youth how to be good adults and much of that has been lost. 3.) Education funding that ensures access to secondary and post-secondary education for all – we still don’t have adequate resources to fully fund students to pursue their educations.  Plus for the tribal colleges inadequate operational support threatens our continued operations.”

Nichole Maher is president and CEO of the Northwest Health Foundation. She became a good friend and trusted partner of the Northwest Area Foundation during her years as executive director of NAYA, the Native Youth and Family Center in Portland, Oregon. Nichole points out, “We have not seen any significant gains for Indian Country around poverty or educational indicators for several decades.  This administration has the unique chance to reframe Native issues as an opportunity to create better outcomes for the United States and to view our children and communities as an opportunity.” She also notes with enthusiasm that at the most recent White House Tribal Nations Conference, the President acknowledged that the Federal government must pay attention to Native people on and off the reservation.  “This is significant,” Nichole says “because it recognizes the changing demographics of Indian Country and the reality that if we want to improve overall outcomes for Native people, then we must have comprehensive strategies that support on and off reservation Native communities.  With more than half of Native Americans now living in urban communities, this is exciting and timely.”

I would add one more thought to this list. Like many Americans, I hope and expect that comprehensive immigration reform will be enacted on President Obama’s watch. As he uses the power of his office to advance that urgent priority, I would like to hear messaging from the White House that goes beyond the cliché that “we are a nation of immigrants.” In truth, we are a nation where immigrants have, from the beginning, interacted with indigenous Tribal nations. There were millions of people here when the first European settlers arrived – and there remain millions of Native people in urban, rural and reservation communities all over the continent. Their ongoing struggle for self-determination and prosperity is central to the American experience, as are the aspirations and contributions of immigrants. The President should pursue a better policy framework for the newest Americans while also – deliberately and explicitly – expanding opportunities for Native Americans as well.

Those are big ideas – and they should be. After all, as Lyndon Johnson famously said, “What the hell is the Presidency for?” The question before us is whether a leader to whom Native people are not invisible can work with them to make real progress. Barack Obama has the opportunity to be remembered as the man who resoundingly affirmed, “Yes we can!” – and then expanded access to opportunities for all Americans, including those who should be invisible no more.

By Mandi Moshay
Communications Manager
Philanthropy Northwest

The Northwest Area Foundation (NWAF) of St. Paul, MN, awards grants across eight states to reduce poverty and achieve sustainable prosperity. NWAF has made grants to nonprofit organizations in the Northwest that support the African American Leadership Forum (AALF), a unified group that is creating a common agenda for launching bold policy initiatives to create social and economic well-being within the minority community. The AALF movement has shaped access to employment, community development, and transportation. We’re pleased to be able to share some of the successful outcomes of NWAF’s works with the AALF in Portland, OR, Seattle, WA, and Tacoma, WA, – these initiatives account for over $340,000 in grants from NWAF since 2009.

Portland, OR: Closing the Employment Gap
Struck by the inequities in white and black employment levels revealed in The State of Black Oregon report, the Portland AALF mobilized to close the employment gap.

“The report revealed chronic disparities in African-American unemployment levels at a time when the mainstream workforce was doing well,” said Portland AALF director Cyreena Boston Ashby. “We found elected officials were approving policies that were standing in the way of improvements, and in some cases, were making it worse.”

Armed with powerful numbers showing bias in hiring and promoting, Portland African-American leaders advocated for an equity officer to provide transparency and accountability. Their persistence influenced Portland to create a new bureau, the Office of Equity & Human Rights. Since then, PAALF members have been invited into meetings with municipal leaders where they’ve been given greater access to employment data.

Portland has adopted a new racial equity strategy and is working with Portland AALF members to increase African-American hiring rates and improve policies such as housing discrimination and police accountability. AALF leaders are expanding the discussions to include equity officers in public schools, regional government, and the Oregon Department of Health and Human Services.

Seattle, WA: Gaining a Voice in Development
Few things have as large an impact on housing, jobs, and economic development as transportation. Seattle is on tap for light-rail expansion over the next decade that will send trains through the heart of minority and immigrant communities and members of the Seattle AALF are participating in the planning and advocating for transit-oriented development so people of color can equally benefit from opportunities.

“When the current rail line was planned years ago, the construction displaced homes and businesses, and has now raised property values to the point that affordable housing is no longer available to many of those previously displaced,” said Liz Word, coordinator of the Seattle AALF. “We are working upstream, being proactive instead of waiting downstream to see what comes our way.”

Through broad networking, AALF members secured representation on the Equity Network Steering Committee of the Growing Transit Communities Partnership. Their goal is to increase involvement of African-Americans in transit-oriented development planning and policies by sharing information they’ve rarely had before. AALF members are working with the Puget Sound Regional Council to apply a social equity framework to development of transit stations and nearby neighborhoods.

Tacoma, WA: Raising Black Leadership to a New Level
The civil rights conflicts of the 1960s mobilized black leaders in Tacoma to action. The Tacoma Urban League and the Black Collective are two of the many organizations spawned from that movement. Over the years they’ve successfully advocated for better policies and representation on the local level. However, there’s never been a platform to break down the silos and increase their synergy – until now. The two are partnering to become the Tacoma African American Leadership Forum.

“The African American Leadership Forum will act as the convener to bring all the groups together under one umbrella,” said Victoria Woodards, president of the Tacoma Urban League. “We will be better equipped to make systemic change by increasing collaboration and harnessing all of our energies.”

The Black Collective, which has been meeting weekly for 43 years, is a volunteer leadership organization engaged in addressing equity issues affecting the Black community. The Tacoma Urban League, formed in 1968, is devoted to empowering African-Americans and other disenfranchised groups to enter the economic and social mainstream.  Backed by increased resources, the Tacoma AALF will work to build a unified policy agenda to address challenges within the community.

Philanthropy Northwest commends NWAF and the African American Leadership Forums they support for their remarkable achievements. To learn more about NWAF and the impact the organization is making in the region, visit www.nwaf.org.

By Kevin Walker
President & CEO
Northwest Area Foundation

If I could add an eighth “Lesson for Funders” to the seven that Philanthropy Northwest’s Journey Into Indian Country captures so beautifully, I would build on Lesson #4, Learn From Mistakes.

My eighth lesson? Learn From Successes.

Since philanthropy has a long and distinguished history of sharing what works, this may sound like one lesson we’ve already learned. We regularly produce case studies, fund replication efforts, try to scale up effective programs, and so on. These practices flow from three concepts that are articles of faith in our field:

•    “best practices,”  “promising practices” and “evidence-based programs” exist;
•    such knowledge is  precious and must be shared; and
•    what works really can be successfully expanded.

We still struggle with the challenge of learning from our failures – but successes? Our sector knows how to learn from those.

On this point, though, as in so many other ways, our response to achievement in Indian Country is disturbingly inadequate.
I would argue that since its nadir around 1950, the overarching story about Indian Country – the headline, if you will – is incredibly positive change.

•    I say incredibly because the odds against today’s Tribal resurgence have been so daunting.
•    I say positive because Native Nations have reasserted their sovereignty and begun the arduous process of nation-rebuilding, often with remarkable results.
•    I say change because the desolate realities of 1950 in Indian Country have begun to give way to a future in which the opportunity to thrive is more broadly available.

So that’s the headline: incredibly positive change. But have you seen a network television news segment recently that explored that story? Or spotted that bold headline at the top of a column in the New York Times or the Seattle Times? Or noticed funders nationwide rallying to support innovations and pursue opportunities in Indian Country?

No – because in mainstream culture and in much of mainstream philanthropy, this headline is more or less a secret. When it comes to working in Indian Country, we have not mastered the common-sense process of learning from successes, trumpeting them, and scaling them up. Part of the problem may lie in the temptation of philanthropy to define success for others. At the Northwest Area Foundation, we are determined to do what we can to change that dynamic – to learn to see communities from a tribal perspective based on the communities’ own values and culture. And we are seeking opportunities to share examples of success and progress in Indian Country.

If exploring these issues is interesting to the Philanthropy Northwest  community, I will gladly follow this post with others that go into detail on successes we see, lessons we’re learning from those successes, and thoughts about how we can work together to change the headline, to tell the real stories.

By Kevin Walker
President & CEO
Northwest Area Foundation

As always, the latest official poverty and unemployment reports, compelling as they are, provide an incomplete view of both the challenges and possibilities we face. The Northwest Area Foundation recently sponsored a national poll that reveals how the hardships of the recession are playing out in American households. Here are a few highlights:

· 61% say they’ve cut back on spending.

· 24% have had a friend or family member stay with them due to lack of funds.

· Nearly half say they don’t know where to turn in their community for help.

· 32% have had trouble affording medical care.

· 51% say the government is doing too little to help.

· Most say elected officials have responsibility for: attracting and keeping businesses that offer good-paying jobs, increasing access to affordable health care; affordable post-secondary education; and housing security.

· A majority said they are willing to volunteer, and over half said they would be willing to pay $50 more in taxes, to help reduce the number of people struggling to make ends meet within their communities.

These national findings are complemented by state-level data for each of the eight states served by the Northwest Area Foundation:  Minnesota, Iowa, North Dakota, South Dakota, Montana, Idaho, Washington and Oregon. The poll, designed and administered by Lake Research Partners, provides advocates and nonprofit organizations with data they can use in their work within communities, as they approach policymakers, and as they work with the media. We’ve also assembled communications tools to make it easier for organizations to incorporate this information into their work.

I invite you to take a look and to share this information freely with peers and the organizations you support. You can find all the material here.