Renewal and Realignment

 by Liz Moore, Executive Director  

Last week the MNA staff and board of directors spent a day in conversation realigning ourselves with MNA’s five year business and strategic plan.  Foundational to the plan – which was crafted in 2010 – were the hopes, needs and wishes for the nonprofit sector as expressed by MNA members and partners. Shortly after the business plan was rolled out, we all watched the recession alter the external environment and then, more recently, MNA’s executive transition brought internal change.  While these events have certainly impacted MNA, our board/staff dialogue gave us the chance to reconnect with our strategic trajectory – which has held remarkably strong even in the midst of change.  The retreat was a chance to once again articulate the MNA bedrock:

• We continue to be about the members – Montana’s 501 (c) 3 organizations. You are the driver for everything we do.
• We direct our resources and activities toward a single high aim: to strengthen Montana’s charitable nonprofit sector.
• We believe more than ever in the power and necessity of our collective voice; whether we are heightening public awareness, providing sector research and education, or engaging in advocacy,  we are fully invested in developing and supporting the nonprofit seat at the table – particularly in the public policy arena.
• We are grounded in partnership; we believe the nonprofit sector is only as strong as our connections with one another as well as with our public and private partners.  

There’s nothing new or earth shattering here – and that’s what was so reassuring. Yes, the timeline we laid out some time ago has altered somewhat, but the MNA fundamentals are absolutely solid. Even in the context of significant change, our strategic direction is spot on. The board/staff conversation was rich, thoughtful, and punctuated by laughter - a great setting for renewal and realignment.

Shout Out for Volunteers!

 by Jono McKinney, Board Chair, MNA  

Montanans are remarkable for their generosity in time and talent. Over a third of our citizens participate in our community life as volunteers sharing over 33 million hours in service every year to strengthen our communities. The Volunteering in America report values this at $714 million in services contributed. What an asset to our state economy.  More importantly, what a measure of our character as Montanans.

April 15-21 marks National Volunteer Week.  This celebration reminds us to thank all those volunteers who help our organizations in so many ways by guiding our boards of directors, serving as mentors, showing up to help with special events, or quietly stuffing envelopes.  Also across our state, over 9,000 AmeriCorps and Senior Corps participants are making a difference through more than 900 project sites. These folks add immeasurably to the strength of our organizations and the vitality of our communities.

The 2012 theme for National Volunteer Week is “Celebrating People in Action.” This begins with us, taking action to lead by example with our own service, and encouraging others to join with us in sharing their talent and time toward positive solutions to our communities needs.   Albert Schweitzer, the 1953 Nobel Peace Prize recipient, reminds us of the transformative power of serving: “I don’t know what your destiny will be, but one thing I know: the only ones among you who will be really happy are those who will have sought out and found how to serve.”  Service can be so simple, starting with a greeting to our neighbor and affirmation that we are neighbors working together for better communities.

Thank you for serving, and thanks to all of you in our Montana nonprofit sector who leverage your passion, talents, wisdom, hearts, and muscles to make Montana healthier, safer, and smarter.

Jono McKinney is MNA Board Chair and Executive Director of the Montana Conservation Corps

Nonprofit Impact: So what's your "so what?"

 by Liz Moore, Executive Director, MNA  

I am extremely pleased to announce MNA’s 2012 Conference this September 19-21 focusing on Nonprofit Impact. As nonprofits today, we must focus on more than how many people we serve, how many events we sponsor, or how many "friends" we have.  Increasingly, donors, policymakers, volunteers, and other stakeholders are asking: “So what? How does your work impact our community, our lives, our future?”  No doubt your work is making an impact, but do you know how to identify it, plan for it, measure it, and demonstrate it to stakeholders?
 
For nonprofit organizations, impact is a word that elicits rich, lively conversation – going right to the heart of organizational purpose. The concept of impact has increasingly taken hold in the nonprofit lexicon as we are asked to become more and more adept at articulating and measuring effectiveness. In short, making an impact has always been important. Today identifying, evaluating and communicating that impact are essential components of nonprofit sustainability.
 
The optimistic desire to make a difference is part of our nonprofit DNA. We are mission-oriented; we come to our work with a particular idea of the unique contribution we want to make. At MNA we literally have front row seats that allow us to see so much good unfolding in Montana because of the work of nonprofits. We also recognize the increasing emphasis being placed on strengthening nonprofit impact. At September’s conference, these two vantage points will come together as we present opportunities to learn how to imagine, achieve, and share our impact.

I hope you will join us as we bring this topic to life – using a generous brush to color every aspect of the conference with vibrant, dynamic conversation on nonprofit impact. So what’s your “so what?”

Investigating Employee Complaints: 10 Common (and dangerous) Mistakes

 by Teresa Geremia-Chart, MNA Organizational Development Director 

Thanks to Len Stanton of Associated Employers in Billings who presented our Fall, 3-part Employee Management:  Most Asked Employer Questions Webinar Series.   All of the webinars provided nonprofit managers with compliance information and strategies for practicing excellent employee management.  

 

During this week’s webinar, Investigating Employee Complaints, we learned how often supervisors fail to take immediate and corrective action in response to employee complaints.  Most issues in the office are not witnessed first-hand by supervisors, so supervisors must investigate, which can be tricky to ensure that whatever decision is made is supported by the evidence collected and documented, and by the process used for the investigation.  And, no, not investigating is not an option.  As with the current issue at Penn State, ignoring a complaint will eventually come back to hurt you and possibly others.

I found the 10 Most Common Mistakes Made When Conducting Employee Investigations (and correct action) most informative.  Are any of the following mistakes familiar to your experience?

1.  Failure to get input from the person the complaint is about
    It’s not sufficient to gather information only from the accusers; you must also interview the accused.

2. Failure to get input from the complaining employee
    Whereas a passing comment from an accuser may be sufficient to launch an investigation, a formal interview of
    the accuser must also be conducted.

3. Shortcutting the investigation
    Take the time to interview ALL witnesses to the incident.

4. Dragging out the investigation
    Resolve the issue as quickly as possible.

5. Terminate now, investigate later
    If enough initial evidence is present, suspend the accused employee without pay until the investigation is complete if you
    must

6. Failure to close the loop
    Instead, be decisive one way or the other and report the outcome (not the details) back to the accuser.

7. No "second set of eyes"
    Be sure to have another person join you when interviewing all parties; one person records (takes notes), the other asks
    questions

8. Inadequate or flawed documentation
    Maintain clear and concise written documentation of each conversation and decision.

9. Failure to protect privacy
    Only share details of the issue with HR, your executive leadership, and/or your legal counsel.

10. Requiring "face-to-face" confrontation
    It is not a good idea to bring the accuser/accused together to try and “work it out” or for interviews.

 

Don’t Overlook Oversight:  Board Governance – Why It Matters

Guest Blog by Kim McKelvey, Executive Director, ALPS Foundation Services    

To be a results and growth-oriented nonprofit board of directors, it just isn’t enough to congregate and show support for the mission of the organization. An effective board should guide the organization at a strategic level. Before a board can do this, it must have its own clearly-defined model of governance, set roles and responsibilities for its board members, and guiding principles that lead toward ultimate organizational goals. Governance allows a board to move beyond maintenance mode to a place of setting and reaching strategic initiatives and growing the organization in a positive, mission-driven way.  It begins with very basic and clear fundamentals.

• Unifying the board on the mission, vision, and values of the nonprofit
• Knowing the impact the nonprofit is trying to make
  
• Developing clear-cut roles for governing board members
  
• Ensuring the board understands and effectively undertakes its governance responsibilities 
  
• Creating and monitoring a strategic plan 

Board governance (or lack thereof) can influence the entire organization – positively or negatively. Governance has many arms and thus many touch points throughout the organization. These appendages can be working together efficiently and effectively or they can be duplicating efforts. Worse yet, they can be sedentary. These arms need a strong, centralized brain to help them maximize impact.

In my session, “Getting It Right: Excellence in Governance,” I will discuss how these fundamentals can be implemented and how the well-governed board can go on to truly influence the success of the entire organization.

I would encourage those interested in this topic to also consider attending a pre-conference workshop on Wednesday, September 28.  Peggy Owens and Terry Profata from Sage Solutions Nonprofit Consulting and Bonnie Sachatello Sawyer, the Executive Director of Hopa Mountain, will present “Governance: Creating Boards that Lead.”  This workshop explores how to form and maintain a governing body that promotes a healthy and successful nonprofit organization.  For more information about the pre-conference workshop, click here .

Also on Wednesday, the State Bar of Montana’s Nonprofit Law Section will present a workshop sponsored by ALPS:  “Legal Issues Related to Representing and Managing Tax-Exempt Organizations.”  The workshop will discuss board oversight, including the legal implications of board service and board governance and management.  An incredible line-up of speakers, including Montana’s Attorney General Steve Bullock, will speak on a variety of topics including the legal liability of board members and how to properly manage and invest endowment funds.  The event is approved for 6.5 general continuing legal education credits, including 1.25 ethics credits.  For more information on the Nonprofit Law Section workshop, click here .

What Nonprofits Need to Know About Social Media:  do you have A-PIE?

Guest Blog by Chris Syme, Principal, CKSyme.org     

There is no better vehicle for bringing outsiders in than social media. Social media can enhance your ability to tell your story, raise friends, sustain campaign engagement, recruit  volunteers, and deepen just about every process that involves human interaction, including fundraising. No, social media isn’t a magic pill, nor is it the answer to all your problems. But, it can be a powerful partner in your effort to connect with people. The latest data collected by Pew Internet Research shows that people who use social networking sites (SNS):

• have more close relationships,
• get more social support than other people,
• are more politically engaged than most people, and
• are more likely to revive dormant relationships.

Also, people on social networks are more likely to keep up with close social ties. There’s a world of data and people out there to connect to in real-time. Are you taking advantage of the best channels to reach your stakeholders and build new ones?

Where do you start? Do you jump in, or should you check the depth and temperature of the water first? I recommend you start by building a solid strategy that is based on the goals and mission of your organization. You need A-PIE:

• Assess: Listen and monitor your audience. Who are they? What are they doing online? Are they creating, monitoring, commenting, posting reviews, recommending to friends? Where are they online? Facebook? Twitter? Blogs? Do they watch videos? Post pictures? Do an internal assessment as well. How much time, resources (people) and money do you have to dedicate to being social? What are your organizational goals? How could social media help you reach them?
• Plan: Take what you learn above and start to formulate a plan. Who will be in charge? Who can post on your behalf? What are your content guardrails? Who will monitor the channels? What metrics are you going to use to judge your progress? Who will do the training?  Who will write the social media policy and how will it be enforced? How often and where will you post? What channels will you implement first? Second?
• Implement: Now that you’ve planned the work, work the plan.
• Evaluate: Always, always, always have a plan to regularly evaluate your progress. Do we need to cut away anything? Tweak? Show me the data.

To find out more about how you can implement an effective social media strategy for your organization, come to the Montana Nonprofit Association Conference in Billings September 28-30. You can find out more about the conference here . I’ll be doing an introductory social media boot camp on Thursday for social media newbies and then a deeper session on Friday on social media strategy that includes managing and building your reputation online, content marketing, and social media optimization. Bring your laptops.  I hope to see you there!

Chris Syme is the Principal of CKSyme.org.  Follow her ongoing blog at www.cksyme.org .

Do Nonprofits Really Need Risk Management?

Guest Blog by Tom McGree, Director of Enterprise Risk Manager, Anderson ZurMuehlen    

Nonprofits exist for lots of different reasons.  In fulfilling their missions, they encounter many of the same risks for-profit enterprises face, including human resource challenges, safety concerns, data protection issues, premises security threats, training issues, and regulatory hurdles.  The difference is that many nonprofits must deal with these issues with access to only a fraction of the resources available to their for-profit counterparts. So what can a non-profit do?  The answer is really very simple: make the most of available resources.  That’s certainly not a new concept for non-profits.

Responding effectively to risk is not about having the newest software or best resources.  It’s about carefully identifying and managing your risks in a consistent, ongoing manner.  Here’s how to start:

1.    Determine what assets (information, materials, people, etc.) you absolutely must have to be able to operate.
 
2.    Take a comprehensive look at what could harm your nonprofit the most.  Don’t overwhelm yourself.  Look at your organization in bite-sized pieces, one at a time, and pay attention to how each piece affects the others.
 
3.    Identify the resources you have at your disposal (including time, experience, relationships, reputation, etc.) to use in solving the problems.  You may not have unlimited cash in the bank, but you do have the resources listed above, plus many others.  Recognize what you do have and take full advantage of it.   
 
4.    Prioritize your risks.
 
5.    Tackle the most important, pressing risk first.  Then move on to the next.

As Brian Tracy has said, “Eat that frog.”  Get the most urgent and important item checked off your “To Do” list, even though you really don’t want to do it.  Then gradually work your way through the rest of your list, beginning with the second, third, and so on biggest challenges.  Monitor your progress so you can celebrate success and make needed course corrections.

You’ll have hiccups along the way.  You’ll also have to deal with unexpected challenges.  Over time, however, you’ll have lower costs, fewer headaches and increased success because you’re staying ahead of the “reaction curve.”  You’ll be moving from disaster recovery to risk management.

For more guidance in managing your risks please join us at the Montana Nonprofit Association’s 2011 annual conference on September 28-20 in Billings, MT.  See www.mtnonprofit.org/conference  for details.  

Tom McGree is the Director of Enterprise Risk Management (ERM) with Anderson ZurMuehlen and Co .  The ERM department works with organizations to identify, evaluate and control risk using an array of resources and methods.  Clients see increased long-term success, lower costs of risk, enhanced information from which to make strategic decisions and increased control over the future of their organizations.  

 

 

Continuous Self Improvement: Plugging in to the Power of Quickbooks

by Irene Bushnell, Shareholder, Anderson ZurMuehlen   

One of the easiest ways to facilitate continuous self improvement is with formal instruction.  Whether it is attending a conference or a seminar, enrolling in a registered class at an accredited school, listening in on a webinar, or watching a self training video, you’ll always walk away with new insights, good information and ways to improve both personally and professionally. Many organizations use QuickBooks for their accounting software.  It is a wonderful program that can be customized to work with almost any small to mid-sized organization.  But all too often we learn the basics and then never take our software to the next level.

Anderson ZurMuehlen is proud to offer a conference that helps you Plug In to the Power of QuickBooks! This conference is about teaching organizations how to fully employ the capabilities of this under-utilized software to more efficiently manage accounting processes. It’s about saving you time and frustration, using less paper, and eliminating costly, inefficient, and often manual work-arounds. It’s about exchanging great old habits and ways of doing things for great new ones.  

But this conference is more than that, because we know your job involves more than that. We know you want to improve your accounting skills and learn best practices.  We understand that advanced report writing and exporting and importing data between systems are high priorities for many QuickBooks users in Montana. Our conference presenters will address all of these issues and more.

Benjamin Franklin said “An investment in knowledge always pays the best interest.” We certainly aren’t earning much interest with today’s economy by putting money in the bank so why not invest in training?

I hope you’ll join us for our Fourth Annual Montana QuickBooks Users Conference to be held in May at four different Montana locations.  Visit our website at:  www.azworld.com/pages/seminars.htm  to read about the sessions to be presented at this year’s conference.  MNA nonprofit members receive a discount – type MNA in the registration or write it next to your registration if you are faxing in your registration.  I look forward to seeing you there!

 

The Role of Nonprofits in Public Policy Advocacy

by Matt Leow, Consultant, M+R Strategic Services, www.mrss.com   

The beginning of Montana’s biennial legislative session is a great time to reflect on the role of nonprofits in public policy advocacy. On January 27, MNA will hold a Nonprofit Day at the Capitol with that very subject in mind. Those who work in the nonprofit world are often too busy serving clients and carrying out their important missions to pay much attention to the policy realm. But decisions made in Congress, state legislatures and city halls can have a profound impact on our local nonprofits and the people they serve. While some organizations make advocacy and lobbying central to their missions, others shy away from it or even believe that their organizations cannot engage in lobbying.

 Right off the bat, let’s clear up that last part. Nonprofits, whether they are a 501 (c)(3) or a 501 (c)(4) organization, are allowed to engage in lobbying and advocacy – the rules just happen to be a bit tighter for 501 (c)(3) organizations. There is no limit on the amount 501 (c)(4) organizations can spend on lobbying. However, federal law prohibits 501 (c)(3), or charitable organizations, from spending a “substantial part” of their time and money on lobbying activities. That said, charitable organizations are permitted to engage in lobbying as long as they do not exceed the limit. For more information on lobbying limits for 501 (c)(3) organizations, go to http://www.irs.gov/pub/irs-tege/eotopicp97.pdf. Since there a few different avenues for 501 (c)(3) organizations to take in regards to the limit on lobbying expenditures, please contact your organization’s attorney before moving forward.

But being engaged in public policy is not strictly about lobbying, a term that refers to asking a decision-maker to vote for or against a specific piece of legislation. Educating decision-makers about an issue is not considered lobbying. Organizations can hold public meetings or distribute reports and other materials to raise awareness about an issue or legislation without crossing the line and having to worry about lobbying expenditures. The IRS website has another helpful article on this area http://www.irs.gov/charities/article/0,,id=163392,00.html

Every nonprofit has a stake in public policy, whether it’s funding for social services, policies directly related to nonprofit administration or specific policies that fall under an organization’s mission. Much like individual citizens have a civic duty to be informed of our government and participate in our democracy, nonprofits have a similar duty to be engaged. Nonprofit organizations have a unique opportunity to advocate for the people they represent – their clients, members or constituency. In fact, a nonprofit often provides the only voice in the public policy arena for a specific constituency.

Spend some time in the halls of the Capitol in Helena and you will see that certain interests are well-represented (energy companies, insurance companies and the banking industry) while other interests (low-income people, the disabled, or consumers) are often represented by just one or two lobbyists. Chances are your organization has something to contribute to the public policy discussion, and may be the only voice speaking on behalf of your constituency.

But if you can’t be in Helena for the 90-day legislative session every other year, don’t consider yourself out of the game. A lot can be done in our local communities or through correspondence with decision-makers if we take the time to build those relationships. So, think about having coffee with a city council member or a local legislator, host a public forum and invite the mayor or a U.S. senator, or use the media to educate the public and decision-makers about your perspective on the issues and the important work of your organization.

And if all of this sounds exciting to you, please consider attending the MNA Nonprofit Day in Helena on Jan. 27. The day will include an afternoon workshop on this topic: Advocacy Beyond the Capitol Building. For more information, go to http://www.mtnonprofit.org/NonprofitDay/. I hope to see you there.

Strengthening the Nonprofit-Government Partnership 

by Brian Magee, MNA Executive Director

 

This month saw an interesting convergence of several issues that illustrate why we must work on our relationship with government – by work on, I mean first deepening the understanding amongst policymakers and government officials about what nonprofits do and the role that nonprofits play in delivering essential services, and then actively pursuing policies and practices that strengthen, not weaken, nonprofits and our communities.  In short, nonprofits and government need to work towards turning the relationship we have into a strong partnership for the future.  Anything less is a disservice to our communities in Montana and across this country.

 

I know that some will bristle at the use of the term “partnership” in reference to our relationship with government.   Fair enough.  Yet, consider the following straightforward facts.  First, nearly 30% of all nonprofit revenues come from local, state and federal government sources.  In comparison, less than 1% of nonprofit revenues come from institutional foundations.  Government is a major funder of essential services that are delivered through nonprofits.  Secondly, we are regulated by government everyday in so many ways.  This goes for small “main street” nonprofits all the way up to large nonprofits with multi-million dollar government contracts.  We all know the demands of reporting and compliance at all levels of government because we feel them every day.  Finally, government has the ability, through policies and practices, to spur (or not) charitable giving and private philanthropy through tax incentives and other means.  My sense is that we can do much better on this front and that we’re not getting the bang for the buck that we should expect.  Given these facts, doesn’t it make sense that we work toward a stronger partnership with government?  Aren’t the implications for our communities too great not to do so?

The following developments from the last month suggest that there is much work to do.  Consider:

Government contracting practices – Just this month, the Urban Institute and the National Council of Nonprofits released the findings of the first comprehensive research survey of government contracting practices across the country.  The picture, to put it mildly, isn’t pretty and points to a fundamentally broken system that hurts everyone.  Even Montana, which grades out better than most states on many indicators, is being described as the “least worst” in ongoing discussions about the research results.  There is plenty of data that supports the notion that the system is broken.  And, in this case, everybody loses – those in need of services, nonprofits with contracts, nonprofits without contracts, policymakers, government agencies, taxpayers, and our communities.  Everyone.

Tax exemption issues – If you subscribe to the Nonprofit Quarterly’s daily Nonprofit Newswire, then you know that a day doesn’t go by without a new story of governments proposing and seriously considering new taxes and fees on nonprofits.  All of this despite a sound argument that doing so would likely be counterproductive to the delivery of essential services in our communities.  We in the nonprofit community haven’t done a good job at all of communicating why tax exemption in the first place.  Now, as government budgets are stretched thin and revenues continue to decline, our own inactivity is coming home to roost.  Just in the past few months, the City of Missoula debated a new tax district that would have included nonprofits in the community.  Fortunately, nonprofit leaders in Missoula were able to convince Missoula officials of the problems with this approach.

Basic data and information – For all the reporting and compliance that we’re required to do, our governments know very little about us, but public policy is still implemented that dramatically impacts our work and our communities.  Tim Delaney, CEO of the National Council of Nonprofits, is often quoted as saying the federal government can easily tell us how many heads of lettuce were exported in any given year, but the federal government can’t tell us even basic information about how many citizens work for charitable nonprofits.  How can we possibly make good public policy decisions that strengthen nonprofits if this is the case?  The short answer is that we simply can’t.  Just this last week, hundreds of nonprofits lost their tax exempt status in Montana because they had not filed a Form 990 with the IRS in the past three years.   We know that many of these nonprofits were previously exempt from filing and our suspicion is that IRS efforts to reach them fell flat because the IRS itself had old – sometimes decades old – contact information for these nonprofits.  That is a travesty.

In summary - government contracting challenges, new tax and fee proposals, and nonprofits that have lost their tax exempt status.  All in the last month.  All in our own backyard.  All under the Big Sky.

I want to conclude by saying this is not an attack on government.  Nor is it a call for more or less government funding.  This is not a call for this policy or that policy related to charitable giving incentives.  It’s not even a call for more or less government regulation.  This is a call at long last for a conversation amongst partners and a seat at the table with our government.  We simply must improve our relationship with government and we must forge a better partnership for the benefit of the work we do and the communities we serve.  In future columns, I’ll be digging deeper into the issues outlined above - as always, feedback is welcome.

 

How to Raise a Lot More Money Now

by Stacie Mann, Network for Good

Hello Montana! Network for Good is thrilled to be part of this year’s conference and I personally look forward to meeting as many of you as I can during my sessions on Tuesday at 1:30pm, The Procrastinator's Guide to Year End Fundraising, and on Wednesday at 9:15am, Flipping the Funnel: How Social Media Is Transforming Philanthropy. I promise to bring some energy! To give you some quick background on Network for Good, we are nonprofit organization that was founded in 2001 by AOL, Yahoo! and Cisco and we are committed to helping donors support their favorite charities online and to enabling charities to attract resources online. At Network for Good, we don't just give you a donate button – we help you make sure people click on it. That's why I am traveling from Washington, DC to Helena, Montana to share some of what we’ve learned to help your organization succeed online during the upcoming fundraising season.

• In advance of my session on fundraising, I wanted to share my favorite new eBook. Some of the best minds in the business came up with 50 creative ideas that you can start using today to raise more money for your cause. In a new eBook, How to Raise A Lot More Money Now, you'll find great ideas from Jeff Brooks, Jocelyn Harmon, Mark Rovner, Kivi Leroux Miller, Beth Kanter, Allison Fine, Nancy Schwartz, Sarah Durham, Chris Forbes, Alia McKee Scott, and Katya Andresen (Network for Good’s CEO and resident marketing maven). More than 14,000 nonprofit professionals have already downloaded their copies.  So what are you waiting for? Get your free copy today! 
  
• For those of you interested in social media, I want to share some Viral Fundraising Tips for your nonprofit from our website SixDegrees.org, a site we launched in partnership with Kevin Bacon where everyday 'celebrities' are making a difference. The headline is that you need to surrender control of the message(s) you are used to formulating about your organization and let your supporters spread the word for you. While this may seem scary at first, the outcome can be surprisingly powerful as I plan to demonstrate during my session on Wednesday.
  

See you soon!

See Stacie at the MNA Conference - Register today.

 

 

Getting It Right: Human Resources

by Ruth French, Human Resource Consultant, Associated Employers

I look forward to being back at the MNA Conference again this year.  The conference is always a great opportunity to connect and reconnect with the many organizations across the state that provide such value to the communities they serve.

The session "Getting It Right: Human Resources" will be a quick-paced overview of how human resources affects your organization.  We will look at the primary functions of HR and the applicable laws and statutes.  This session will provide a basic overview, giving participants a chance to examine where they may need to focus attention in bringing their organization into compliance and possibly pursue further education.  Although human resources can be a complex area, "Getting It Right" can save your organization a lot of time and potentially money in the long run.
 
This session is for anyone interested in learning how to make their organization an "employer of choice" and improving the management of their most valuable resources -- their employees.

 

Pre-Conference Session - Strategic Learning:  Getting the Most Out of Evaluation

by Peter York, Senior VP & Dir. of Research, TCC Group

 

Peter York and Jared Raynor will be presenting Strategic Learning: Getting the Most Out of Evaluation at one of MNA's Pre-Conference workshops.
Many evaluations focus heavily on methods, data and recommendations, but results are far-to-infrequently used. This session focuses on how evaluation can serve an ongoing strategic learning process that supports and strengthens a true learning culture toward increasing impact and taking programs/services to scale. Participants will begin to develop learning plans that can satisfy funder demands, internal decision-making, and stakeholder communication and outreach efforts.

 

Increase your impact through advocacy, organizing & civic engagement

by Gita Gulati-Partee and Lisa Ranghelli, National Committee for Responsive Philanthropy

Greetings, Montana nonprofits!  We are excited to see you in a few weeks.  In our session, Making the Case: Increasing Your Impact through Advocacy and Organizing, we’ll discuss strategies that every nonprofit can and should use to benefit your communities and achieve your mission.  Nonprofits are the lifeblood of our democracy – but we can only fulfill that promise if we make full use of our advocacy voice and our ability to organize and mobilize our constituents.

The session will share findings from the recent report Strengthening Democracy, Increasing Opportunities: Impacts of Advocacy, Organizing and Civic Engagement in the Northwest Region from the National Committee for Responsive Philanthropy (NCRP).  In Montana, organizations supporting voting reforms, living wages, women’s and children’s health, culturally appropriate education, immigrant rights, environmental protection and clean energy achieved impressive impacts including:

• Convincing the state to adopt water standards to protect rivers from pollution associated with coal bed methane development.
• Expanding eligibility for Medicaid and Children’s Health Access Program (CHIP) from 175 percent to 250 percent of the Federal Poverty Level, thereby covering up to 30,000 more children.
• Winning same-day voter registration and ‘no-fault’ absentee ballots. Increased use of absentee ballots (29 percent in 2006 and 43 percent in 2008) has contributed to higher voter turnout rates in Montana in recent elections (64 percent in 2006 and 74 percent in 2008).

Leaders from Montana Human Rights Network and Montana Women Vote, which were featured in the study, will share transferable lessons for how to accomplish your organization’s mission and increase your impact through advocacy, organizing, and civic engagement. We’ll also discuss how to make the case to funders. As you’ve probably experienced, many grantmakers can be reluctant to engage in policy matters despite the tremendous impact such activity can have. Informed and empowered nonprofits can educate and move funders – thus influencing the flow of philanthropic investments and increasing resources needed to achieve the social change impacts you seek. 

Throughout Montana and the nation, nonprofits are activating their advocacy voice and achieving impressive impacts that transform people’s lives.  We hope you will join us for this session – and join in the movement to increase nonprofit and philanthropic impact.  See you in Helena!

Lisa Ranghelli is director of the Grantmaking for Community Impact Project of the National Committee for Responsive Philanthropy (NCRP). Gita Gulati-Partee is founder and president of Open Source Leadership Strategies. Lisa and Gita have authored/co-authored reports from the series Strengthening Democracy, Increasing Opportunities: Impacts of Advocacy, Organizing and Civic Engagement. Visit NCRP’s blog Keeping A Close Eye … for more analyses and commentaries on nonprofit advocacy and community organizing.

A special note to Montana Nonpnrofits

by Ruth McCambridge, Editor in Chief, The Nonprofit Quarterly

Soon I will be traveling to Montana to talk with all of you about what’s happening in and around the organizations you run. I will be coming straight from Humboldt County in California, a remote and largely rural area so I hope I won’t be in the weird east coast mode that sometimes earns me the “edgy” (and not in a good way) descriptor in Memphis when I’m there hanging around with this child care organization or that health center. The point is, though, that when I come to Montana, I will be bringing with me stories about what is happening in the rest of the country and I will be coming prepared to listen carefully to the stories you have to tell me, the analyses you have to offer about what is happening right now among nonprofits.

That is my stock in trade. As the editor of the Nonprofit Quarterly, I follow the stories of nonprofits wherever they are happening. We trace changes in policy, developments in the relationship between nonprofits and government at all levels and watch what philanthropy is doing. It is true that every part of the country is different. In New Jersey, arts organizations were precipitously cut in last year’s budget and now Legal aid services are being threatened by a decline in trust fund accounts. In Texas, the budget for mental health services has been slashed right at the moment when that infrastructure is more badly needed than ever because of
health care reform and the Mental Health parity Act. In the Gulf, community centers for the thousands of Southeast Asians that work in the fishing industry are working overtime to provide services to people who are unemployed and uncovered with few prospects because they were paid in cash.

The nonprofits of this country have made themselves indispensable over the last two years. They have mobilized quickly to work on many aspects of the nation’s present state and they are perfectly poised to take a more powerful position in crafting the future of this country. This is what I want to talk about when I come to Montana. That and everything that matters to you. Please feel free to suggest topics that you’d like me to touch on in response to this post and I’ll see you all soon!

More Than PowerPoint Slides, Nametags, and Carbo Snacks

a few good reasons to attend the MNA 2010 Conference 
by Teresa Geremia-Chart, Organizational Development Director

The 2010 MNA Nonprofit Conference, our 9th, is just around the corner and online registration is now open.  You might be wondering if you should attend this year’s conference, spend the money, take the time away from the office, sleep in a hotel, and well, let’s face it… you don’t always get what you want to eat….all valid considerations.    But, the benefits of attending the MNA conference absolutely outweigh the sacrifices.

First, the content:  The conference curriculum includes thought-provoking, leading edge information and discussions about the future of our sector to help you to learn how to be agile, informed, financially sustainable, and collaborative in today’s constantly evolving, ever-competitive, increasingly scrutinized and more exciting-than-ever nonprofit environment!  Topics include Montana’s revenue challenges and the 2011 legislative session, the impacts of advocacy and civic engagement on social change, and the 5-year future of MNA and you - not to mention, skill-building sessions about the “new” donor, strategic learning for real impact (not your grandma’s evaluation process), creating a culture of fundraising in your nonprofit, developing leadership skills, recruiting today’s volunteers, social media, green computing, federal grant management, nonprofit investing, and more, more, more.

Second, the talent:   Ruth McCambridge of The Nonprofit Quarterly, one of our nation’s most respected nonprofit journals, who is a dynamo with her finger on the pulse of sector-wide issues will set the stage with her keynote address (and give away subscriptions to her publication).  Tim Delaney, National Council of Nonprofits’ (NCN) CEO who, with a sharp mind, extensive experience, and political savvy is transforming NCN into a leading force for change, and striving to get nonprofits a seat at the political table.  TechSoup, Network for Good, the TCC group (evaluation leaders extraordinaire), along with the Minnesota Council of Nonprofits, our sister association, will be in the house, not to mention Kit Gillem of M.J. Murdock who will reprise his advanced grantwriting workshop for our pre-conference.

Content and talent:  Our member nonprofits inspire us every day.  But the story of the Indian Law Resource Center and Tim Coulter’s humbling yet powerful work on behalf of indigenous peoples moved me to want to share it.  Their work has progressed steadily and successfully a few blocks from my own house and I didn’t even know about it until recently - one of many hidden gems among our members! 

Networking and sharing:  As a result of reading evaluations from past conferences and our seminars throughout the year, I’ve learned that participants appreciate hearing about the strategies, challenges, successes, and work of other organizations in their community or in their subsector group.  The conference, especially the reception, is a great way to connect with your peers to exchange ideas and share tips for managing your board, your staff, or for getting insight into that funder you’ve been pursuing.  Join us for beverages and a slice of brick baked pizza at the MNA Reception hosted by the Archie Bray Foundation for the Ceramic Arts – talk about a gem – this Montana treasure has international sparkle, too.

Special features:  Behind Google, the most used online server is YouTube.  If so many people are looking at YouTube, they should be looking at your nonprofit.  Learn how to share your work by creating a video (it’s easy with our new Flip Camera) and qualify for a drawing to win a free Flip Camera of your own.  We’ll show you how to make your own 30-90 second video. We’ll even edit it and send it to you for your use in telling your visual story.

Got a burning management question?  Meet one-on-one with a consultant or professional about your specific question or issue through Consultant’s Corner (25-minute sessions during break times).  Experts will be on hand to discuss areas of nonprofit management from governance, to fundraising, to human resources, to financial management, and more.

Become your nonprofit’s financial hero.  New this year, learn how you can save money for your organization through MNA’s insurance programs: Unemployment Insurance Alternative, Nonprofit Business Insurance, Major Medical Health Insurance, and our new Property and Casualty Insurance.  Sign up at the conference for informal, break time “mininars” with representatives from our insurance partners and MNA staff. 

Don’t forget about the exhibitor fair.  Learn about services and products available to your nonprofit and talk directly with professional service providers from banks, to printers, accountants, to web developers, and more.   Some of our national vendor partners will be available this year, too!

Finally, you can pick up staff and presenter book favorites from Fieldstone Alliance, BoardSource, and others at the MNA Book Fair.  I use many of these books in my office to learn about strategies and techniques; some include CDs of templates, checklists, and sample policies.

The most important reason to attend the conference is to take pause from extinguishing the daily brushfires in your organization, to reenergize, be inspired, and celebrate the impact you’re making in the lives of Montanan’s everyday.
 

by Teresa Geremia-Chart, Organizational Development Director

This spring over 430 nonprofits participated in one or more of our 13 Principles and Practices implementation webinars and seminars covering topics ranging from Governance & Leadership, Human Resources, Fundraising, and Communications/Technology, and finishing with a couple of outstanding Financial Management workshops earlier this month.   Webinars took us into the offices of our members throughout the state from Miles City to Whitefish; seminars took us from Hamilton to Helena, and Great Falls to Missoula with a great trip to Butte in the middle. 

First, thank you to our nonprofit members for taking the time from your busy schedule to explore ways to improve your efficiency, effectiveness, and sustainability by improving your organizational development.  Second, I want to thank our training partners, from Barb Harrington of the Sponsorship Network in New York and Andy Robinson in Vermont, to Terry Profota of Sage Solutions in Bozeman, Ruth French of Associated Employers, Jan Schweitzer of Anderson ZurMuehlen, our friends at NTEN and GrantStation, and Kelly Bruggeman of First Interstate Bank Foundation, Lynda Bourque Moss of the Foundation for Community Vitality, and Carol Lewis of Philanthropy Northwest. 

One observation from this training series is that nonprofits are willing to share their experiences and strategies with other nonprofits.  Collaboration is what distinguishes us from other sectors where competition separates success from failure.   Some of the best time spent at trainings was hearing how nonprofits at various stages of development first wrestled with and then successfully applied management theories to improve their own organizations.  

Another observation is how many hats nonprofit managers must wear.  Unlike large corporations or government, few nonprofits have HR departments, CFOs, attorney's on retainer, or even professional fundraisers.  Most nonprofit managers must become experts (and fast) at governance, raising funds, managing finances, and hiring and supervising personnel and volunteers. Moreover, nonprofit managers must also understand legal requirements in areas of corporate governance, grant management, IRS fund management, and federal and state labor laws.  My hat is off to all of you; and for our part, we'll continue our work to help ease your task by providing as many resources as we can through our Principles and Practices, online materials and links, continued trainings, and of course our annual conference, which is described below.  

Throughout the trainings, I had a great time sharing the experience and content on Twitter.  Below is a selection of some of the best tweets from the series.

• The person who typically commits fraud in a nonprofit is the person least expected to commit fraud
• 2008 grants in Montana totaled 1,151 - median grant size in MT was $9,500 compared to regional Northwest median at $7,500
• From Philanthropy Northwest Trends in Northwest Giving Report 2010 http://bit.ly/93ehWI
• Individuals remains the biggest source of giving to nonprofits over corporation and foundation giving
• Sustainable nonprofits have 4 capacities - leadership, adaptive, management, technical - From TCC group: http://www.tccgrp.com/
• Nonprofit board tasks should be SMART:  specific, measurable, achievable, realistic, and timely
• Nonprofit board responsibilities fall within 5 buckets:  leadership, governance, stewardship, management, and highly engaged volunteer.
• Nonprofit ED evaluations are based on criteria and done annually, get input from full board - check out @NatlCouncilNPs ED compensation information.
• Fed grant requirements OMB Circular A-122; A-110; and A-133 http://www.whitehouse.gov/omb/circulars
• Wage Claims #1 reasons for lawsuits against nonprofit employers, 2nd is harassment
• Unpaid interns must be students and/or learners - in MT must complete an application with DOL - New Fact Sheet
• Churches get the majority of individual gifts because they ask and ask often...and big - 10% of income - and they ask everyone
• All board members should know your funding mixture - how much from gifts, from foundations, earned income, etc.
• Board assignment: Each - sit down with a blank piece of paper, write your organization mission in your own words.
• NTEN/MNA webinar: Baby Boomers are embracing popular consumer technology apps. nearly 20 times faster than younger gens.
• Number one comment heard by GrantStation from international funders is: "Yes, we fund in the U.S., but no one ever applies."
• Barb Harrington says to reinvest 15-20% of sponsorship for advertising, tickets, and giveaways 

 

by Brian Magee, MNA Executive Director

We have been saying for quite some time that MNA is part of a growing movement across the country to strengthen the nonprofit sector through collective action and influence. This is new territory for all of us and we’re learning as we go, but the early returns are very encouraging. In particular, MNA’s healthcare related work over the past year – both on the federal policy side and our homegrown Group Benefits Trust - is a prime example of the power and potential of this movement. This month’s article sheds some light on the results of this important work.

On the policy front, MNA worked closely with our fellow state associations through the National Council of Nonprofits to ensure nonprofits were included in the small employer tax credits that passed in this year’s landmark healthcare legislation. When legislation was first introduced, nonprofits were not afforded the same benefits as small businesses – we were essentially left out of the equation. The good news is that our network’s intense lobbying of Congress changed all of that by moving our country’s leaders to see both businesses and nonprofits as “small employers” requiring assistance. Collective action produced the desired result.

The new health care reform law now allows small nonprofits to claim up to a 25 percent tax credit when they pay for at least half of the health insurance premiums for their employees. To claim the credit, the nonprofit must have 25 or fewer employees, average wages must be less than $50,000, and the nonprofit must pay at least 50% of the insurance premium cost for employees. Eligible nonprofits can start claiming the credit immediately. These are real significant savings which translate to more dollars in the bank accounts of many small to midsize nonprofits. Click here for more details on the small employer tax credit.

At the same time that MNA has been engaged in national advocacy efforts around health care reform, we have been working diligently to contain costs here at home. After several weeks of negotiations with Blue Cross Blue Shield of Montana (BCBSMT), MNA’s Group Benefits Trust (the Trust) announced recently that health insurance premium costs for the 2010 plan year beginning July 1 would increase by an average of only 3.7%. This means that MNA members participating in the Trust have one of the lowest premium increases for an employer sponsored group benefit plan in Montana. Since its inception in 2007, the Trust has averaged a 6% annual increase, far below the Montana and national average. And finally, in what has become a rare event, two of the seven plans offered by the Trust will have a premium decrease for the upcoming year. Click here to read MNA’s press release on the Trust.

In the coming weeks, MNA will be sharing with you more information about positive Trust developments including the addition of stronger preventive benefits, ala carte benefits such as vision and dental, and a first rate wellness program. Our hope is to leverage this strong renewal and partnership with BCBSMT to significantly grow the Trust well beyond the current 43 MNA member employers of the Trust who provide health insurance for 700 employees and many dependents across Montana. If you haven’t looked into the Trust in awhile, we encourage you to do so. Please do not hesitate to contact Brad Robinson at MNA should you have questions about the Trust and MNA’s health insurance program.

As for MNA, our work on the policy front and on your behalf never rests. I’ll be visiting with our congressional delegation as part of Nonprofit Lobby Day on June 16^th in Washington DC. I’ll be sure to thank them for their support of nonprofits as small employers and update them on our success with the Trust. Stay tuned for next month’s “From the Desk” when I’ll provide a full report from my trip to the Hill.

 

 

 I receive numerous calls and emails from our member nonprofits who are seeking creative ways to fill staffing needs with limited funds. Hiring an Executive Director as an Independent Contractor is often suggested but is not allowed within state and federal Wage and Hour laws. Utilizing modestly paid volunteers is another common question, as is asking or allowing paid staff to volunteer for portions of their own job.

These are not uncommon practices in our sector, and typically come about because as nonprofits, we are notoriously underfunded and consistently receive pressures to use funds prudently. We therefore try to find, with limited funds, creative ways to meet the ever growing service demands of our work. Unfortunately, many of these practices are not typically allowed.

We highlighted these issues and many more in our recent Principles and Practices Human Resources webinar series on Wage and Hour Laws. This was the second time we offered this webinar series and once again the conversation generated numerous questions about employment practices, what’s allowed, and what’s not.

Below are some of the most oft asked questions and brief answers. To find out more, consult the Federal Fair Labor Standards Act Wage and Hour Division, and for the state of Montana, MCA, Title 39, Chapter 3, Montana Administrative Rules 24.16, and Montana Department of Labor Wage and Hour Laws. Also, check out the MNA website for more HR resources including information about Independent Contractors.

1. Can staff volunteer to do their own job? No, they may volunteer to do other jobs for the organization, but those tasks may not be routine nor may they fall within the employee’s own job description. If the employee is spending extra time doing his/her job (and in this case is a non-exempt employee), that person must be paid overtime.
2. Can we pay our volunteers a token amount? Well…..maybe! The IC unit of the state workers compensation division says that if you pay an individual in any amount, that person must have a business, be an Independent Contractor (and provide ICEC), or be an employee. However, MT Wage and Hour code: 39-3-406 and the Department of Labor suggest that a volunteer can be partially or fully paid. My advice, make sure you check it out with these two entities.
3. Can I give a volunteer a gift certificate or tickets to a concert to reward their good work? See #2 above.
4. Can I award compensatory time to my exempt employees? Sorry, no. “Comp time” is not available for private organizations, only employees of public/governmental entities.
5. Do I have to pay non-exempt employees for travel time? According to the MT Department of Labor, yes, if an employer is requiring that employee to travel on behalf of the job. You may pay a different travel rate than the regular rate being paid to the employee, but the travel rate must be at least minimum wage.
6. Do I have to pay a non-exempt employee for time they spend in training? Generally, yes, and at the regular rate, unless all 4 of the following apply:
   - Attendance is outside of employee’s regular work hours,
   - Attendance is voluntary,
   - Not directly related to employee’s job, and
   - Employee does not perform any productive work during attendance.
7. Do I have to pay out unused sick leave when an employee leaves? No, but you may do so if you want and you should language in your personnel policies in that case. You ARE required to pay out unused vacation time, however.
8. Can I extend the probationary period of an employee? Yes, but there is a specific process you must follow and you may only extend en employee’s probationary period by 90 days. The process includes: 1) have a policy in your personnel policies that reserves the right to extend the probationary period, 2) notify employees at the time of hire, and 3) notify the employee of your intention to extend their probationary period prior to the expiration of their primary probationary period.
9. Is Montana an at-will employment state? No, Montana is a “just cause” state and the only in the nation that is not an at-will state. This means that during the probationary period you may release an employee for no reason but after the probationary period, you must have just cause.

 

Theft From Within
written by Shirlee Walker of Anderson ZurMuehlen, Certified Public Accountants and Business Advisors

Read below and then plan to join  Anderson ZurMuehlen's Jan Schweitzer and MNA for Nonprofit Financial Management:  Effective Practices for Accountability and Fraud Prevention 

Jan Schweitzer, CPA Anderson ZurMuehlen

As our economy struggles with the realities of a recession, the risk of fraud will increase drastically.  As revenues decline, layoffs or reductions in salaries and benefits will affect every sector of business and nonprofits.  Workforce reductions will lessen effective internal controls, change the internal control environment, and increase the risk of employee embezzlement.  Most entities will be vulnerable and many will become victims of fraud.

There’s an old saying that to catch a thief, you have to think like one.  Find the soft spots in your high risk areas and implement controls to correct the weaknesses.

Employee fraud can occur when three conditions are present: opportunity, need, and rationalization.  Opportunity exists when segregation of duties and internal controls are lacking, especially in handling cash.  Need can develop under numerous conditions, and a reduction in family income is a significant one.  Rationalization occurs when employees feel their need for cash is greater than the organization’s or they feel the organization owes it to them.  Most small employers dismiss the idea of employee embezzlement with an “It can’t happen to us!” mentality.  Embezzlers don’t use guns; they use trust, friendship, and control of assets.  And yes, it can happen to you.

If you’ve been reading the newspaper, you know that employee embezzlement happens in Montana and is becoming more common.  Here are a few examples of Montana fraud:

• An employee of a small Montana city admitted to stealing cash paid to the city’s sewer and water department.  In three years she stole about $60,000.
• An officer of a local union was sentenced to 45 years probation for embezzling $15,613.  He had written 84 unauthorized union checks to himself, cash, and third parties during a 15-month period.  He forged the names of other officials and made false entries in the union’s books to conceal the thefts.
• A clerk at a small Montana school district purchased tickets to concerts, took vacations, and bought season tickets to Grizzly football games out of the funds she embezzled.  She had worked for the district since 1986.  When the embezzlement was discovered in 2006, the loss totaled over $500,000.

In the above examples, the common denominator is that the embezzlers were given the ability to write checks or make deposits, record the transactions, and reconcile the cash accounts.  They had complete control of the cash coming in and going out of their organizations.  Cash isn’t the only asset employees steal, but it’s the most common.

All organizations should review their fraud risks and areas where they are most vulnerable.  Next, review the internal control policies and procedures for compliance with the policies associated with risk areas.  Internal control policies that are not followed are of little value.  There’s an old saying that to catch a thief, you have to think like one.  Find the soft spots in your high risk areas and implement controls to correct the weaknesses.

No organization is immune to employee embezzlement, but an organization with well-implemented internal controls has a better chance of avoiding it. 

Shirlee Walker is a CPA, CFE, Shareholder of AZ & Co. P.C.  Jan Schweitzer is a CPA, Certified Quickbooks ProAdvisor and Shareholder of AZ & Co., P.C. Learn more about financial management policies and internal controls to prevent fraud in your organization in Hamilton on June 2 or Helena on June 10 for an MNA Financial Management Training

 

 

Get What You Want, Create an Active Board:

10 steps that lay the groundwork for a dynamic and engaged board 
by Terry Profota, Sage Solutions Nonprofit Consulting

Have you ever recruited a board member with this line, “Join the board, you don’t have to do anything,” or “It’s ok if you can’t come to the board meetings or fundraise?”  You may not have, but unfortunately these lines are often a recruiting mantra for many organizations.  You can guess the results; individuals are recruited with no idea of what is expected of them and lack a commitment to the organization. It is a set-up for failure.

Never recruit just because an individual has money, skills, or networks! No matter who you might think you need on your board, their effectiveness and engagement is only as good as their passion for the mission, their willingness to make time for the organization, and congruency with organizational values..

Engaged boards start with clear expectations and a well thought out and implemented recruiting process.   The quality and commitment of board members is just as important as the quality and commitment of staff.  We all know the headaches that come from hiring the wrong person; the same holds true for board membership.  Never recruit just to fill a board seat.

Successful boards are created through proactive recruiting that includes clear expectations and the grit to articulate these expectations during the interview process.  So how do you accomplish this?  The following are ten steps that lay the groundwork for a dynamic and engaged board.

1. Establish board terms, term limits, and a reoccurring time of year for elections. 
2. Create a written job description that includes board responsibilities and specifics regarding programming and fundraising expectations. 
3. Build an organizational culture that says, “Everyone is a recruiter.”  All board members and management should be well versed in the process of identifying and vetting candidates.  Encourage everyone to submit qualified candidates to the Nomination Committee for review.
4. Establish a Nomination Committee that is charged with contacting, interviewing, and nominating candidates for board approval. 
5. Develop a process for identifying, interviewing, and electing board members; and commit it to writing (the likelihood of remembering it from year to year is slim). 
6. Carefully consider and discuss board composition.  The question: “Who do we need on our board in order to move us towards our mission?” should guide you in identifying prospects.
7. Never recruit just because an individual has money, skills, or networks! No matter who you might think you need on your board (from Step 6), their effectiveness and engagement is only as good as their passion for the mission, their willingness to make time for the organization, and congruency with organizational values. 
8. Use common sense when electing new board members.  It is never a good idea to have a board candidate sitting at the meeting where he/she will be elected.  First, it is just not good manners.  Second, it allows no time for the new member to be educated on expectations and issues before they must engage in decision-making.  Finally, it invalidates the election process; are you really going to say “no” to someone who is sitting outside the door?
9. Train new board members on roles and responsibilities as well as programs and services.   Board orientation should contain three features:
   a. A Board Notebook that contains at a minimum a board job description, current strategic plans, financial statements, past board minutes, and program information.
   b. A board-delivered orientation that focuses on board roles and responsibilities and other issues at hand, scheduled before the new member’s first board meeting.
   c. Assign an experienced board member to act as a mentor and assist with introductions and answer questions.
10. Value continuous learning and improvement. The saying “knowledge is power” is true for nonprofits as well as for business, hard work alone is not enough.  Prioritize learning by encouraging board members to participate in annual board orientations, research, and bring articles to board meetings for discussion, and budget money to support training opportunities.   The more you know the better you can become!

Creating an engaged board is not difficult but it does take time, consistency, and allocation of resources.  If you remember that a board’s #1 job is to assure that the mission of the organization is met efficiently and effectively, and if you recruit only individuals who are excited about being part of that process, your organization will excel and the public will win.

Terry is the founding partner of Sage Solutions Nonprofit Consulting, LLC, and an adjunct professor at Montana State University's College of Business. She is a founding board member and past chair of the Montana Nonprofit Association. www.sagenonprofitconsulting.com

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Join MNA and Terry for a Board and Governance seminar designed to provide you with the tools and resources you need to implement the practices of the Governance and Leadership principle of MNA's Principles and Practices for Nonprofit Excellence in Montana.  We'll be in Great Falls May 20, and in Butte May 26.  
 

Job Descriptions Make the HR World go ‘Round
by Ruth French, HR Consultant, Associated Employers

Have you thought about the importance of job descriptions in your relationship with your employees?  Many organizations do not value job descriptions enough because they are not aware of the many uses to which they can apply.  A well-written job description can help an employer manage its relationship with its employees through the entire circle -- from hire to discharge. Job descriptions define the work relationship.  Let’s look at the uses of job descriptions as an employer works with its employees.

It is also through a well-written job description that an employer can determine whether the position is classified as exempt or non-exempt under state and federal wage and hour laws.

Recruiting. Prior to an employer even advertising for an opening, a job description for the position should be created or, if one exists, it should be reviewed to determine whether it still accurately reflects the conduct, attendance, and performance expectations of the position.  By using the job description to create a job posting, an employer can ensure that it is getting the most qualified applicants for the opening.  In addition, by creating interview questions based on the duties required for the position, the employer will be able to explore the applicant’s suitability for the job, making good hiring decisions based on the specific job requirements.

Orientation/Training.  Once the new employee is hired, the manager can use the job description to orient the new employee to the tasks that are required of the position, and provide training in any areas that the employee may be lacking.

Performance Management.  The essential functions from a job description should be used to evaluate how an employee is performing in his/her position.  The employee’s supervisor can use the duties described in the job description to set the employee’s performance expectations and hold the employee accountable to those during the year.  At the end of the year, when formal performance appraisals are done, those duties listed in the employee’s job description can be used to fairly evaluate the employee’s performance, along with other performance measurements of abilities such as initiative and interpersonal communication, etc. if applicable.  The strongest and fairest evaluations are based on how well an employee performs duties outlined in the job description.  If a manager begins to see performance issues with an employee, the job description can be used to coach and counsel the employee on correcting those performance issues to bring the standard back to expectations, and then move into the formal discipline process if the performance does not improve.

Wage and Salary Administration.  An organization’s compensation system requires that jobs be classified and evaluated in terms that make comparisons possible.  It is with job descriptions for each position that employers can determine the relationship of the positions within its organization, the relative worth of each position, and establish compensation strategies for the organization.  In addition, the job description can be used in conducting salary surveys and comparing your organization’s positions with those of other organizations.  It is also through a well-written job description that an employer can determine whether the position is classified as exempt or non-exempt under state and federal wage and hour laws.

Legal Issues.  Well-written job descriptions are an organization’s first line of defense against claims under the Montana Human Rights Act or the Americans with Disabilities Act (ADA). Absent written documentation of the essential functions and the physical and mental demands of the job, the organization may be required to make accommodations to individuals with disabilities where it would not have otherwise been legally required to do so.

Learn more and register for Ruth's webinar series "Avoiding Lawsuits and Unfair Employment Practices: What You Don't Know Can Hurt You."

Ruth A. French, PHR, is a Human Resource Consultant with Associated Employers in Billings, Montana, a private Employers Association that provides Business and Human Resources expertise to its members.  To learn more, please visit us at www.associatedemployers.org

 

Board Bribery, Or Is It - mobilizing your board to raise more money
by Andy Robinson

“How many of you are satisfied with your board’s fundraising performance?” When I ask this question at fundraising workshops, it generates a lot of ironic laughter. In my experience, the great majority of boards do a poor job raising money. Indeed, if most trustees embraced their fundraising responsibilities with commitment and good humor, consultants like me would have a lot less work. We could declare victory, which would be wonderful. On the other hand, I would have fewer opportunities to visit Montana.

A colleague in Iowa approached this challenge from a unique angle: she used bribery. Before you get upset, keep reading.

She had attended an earlier seminar; when she heard I was coming back for a session on board fundraising, she got excited. “How,” she asked herself, “can I get my board to participate?”

She approached a committed donor with a novel pitch: “If I can convince 6 out of 10 trustees to attend a three-hour fundraising workshop, will you give us $500?” The donor immediately understood what she was trying to accomplish and agreed.

She approached a second donor and said, “We have $500 pledged if we can turn out six board members. Will you help me raise the bar? Will you give another $500 if nine out of ten attend?” The donor agreed, and with $1000 committed she went to the board.

“We have a great opportunity,” she said. “A nationally-known fundraising trainer is coming to town for a community workshop. If nine out of ten of you will show up, we get $1000 – just for showing up! You can sit there and just observe if you want, but you need to be in the room for us to collect the money.”

Well, not only did nine of them showed up, they engaged, they participated, they asked good questions, and you know the best part? When the program ended, they wouldn’t leave the room. They stood in a huddle discussing the ways they could apply what they had just learned: putting together a board fundraising menu, identifying prospects, asking for gifts face to face. This went on for at least twenty minutes.

They had reached critical mass for organizational change because they were all in the room together – the key word is “all.”

Is this bribery? Of a sort – but the financial beneficiary is the nonprofit, not the individual trustees, so everything’s good.

Looking forward to seeing you all in Missoula on April 21. Bring lots of board members … whatever it takes to get them there…

MNA Training ••• Mobilize Your Board to Raise More Money - MNA is bringing national trainer, consultant, and author Andy Robinson to Missoula for this 1/2 day training in April!  If your board isn't raising all the money it could -- indeed, if your board isn't raising any money at all -- you're not alone. In this workshop, learn the reasons why, and learn the strategies to turn things around. You'll leave with several practical, specific ideas for increasing board involvement and effectiveness.  Learn More

Webinar Followup: Thoughts and Links
by Patty White, MNA Communications Director 

I attended the MNA /NTEN webinar on "Getting Started with Social Media Fundraising" yesterday and came away with a few thoughts: First of all, it was great to see over 75 MNA members taking part in this free event that came about as part of our partnership with NTEN. It was also good to catch up with Holly Ross, Executive Director of NTEN, who was one of our fabulous presenter at last year's MNA Conference.

We found that nearly half of those attending the webinar currently use social media tools (Facebook, Twitter, YouTube, LinkedIn, etc.) for their organization. This is exciting news and will give me many new organizations to follow.

Holly offered great exmples of using social media for fundraising, how to get started with social media, and most importantly I believe, how to put your social media strategy in place for your organization.

When asked about the rumor that Facebook may start charging a fee, Holly replied that she had not heard that rumor but that nonprofits should start experimenting with these tools now to figure out what works for your organization before they start charging. As with other technologies, we may need to start budgeting for these tools in the future.

Holly and Annaliese share an additional recording for us below that fits in with our social media fundraising topic - a webinar they hosted last week on how you can now use YouTube features to drive actions and donations, create "Choose Your Own Adventure" style experiences, and make your video the talk of the web (quite literally).

For those of you who weren't able to attend (or if you did and need a review), I have listed links to the recording of the webinar and great resources that were mentioned in the session. The Chat Transcript link lists lots of great resources for fundraising with social media and integrating it into your organization. I would love to hear your feedback on how social media has worked or not worked for you, whether you use it for fundraising and/or for other activities

Webinar Recording & Materials:

Recording: https://cc.readytalk.com/play?id=3s4tnx

  
Holly's Slides: http://www.slideshare.net/nten_hross/fundraising-in-social-media-cna

Chat Transcript: MNA_webinar_chat.xls

Bonus YouTube Webinar: http://nten.org/blog/2010/03/23/activating-your-youtube-audience-recording-and-links 

Follow MNA:
  

Connect With NTEN:

Join our discussion groups

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 Big Brothers Big Sisters doubles sponsorships in down economy
Cathy Huntly, Big Brothers Big Sisters of Helena 

My name is Cathy Huntley and I am the Special Events Coordinator with Big Brothers Big Sisters of Helena. Two years ago I attended an MNA workshop presented by Barbara Harrington of the Sponsorship Network to learn how we could utilize corporate sponsorship at our events.   I was inspired by Barbara’s approach and this new opportunity to raise funds for our program.  Being a small nonprofit in rural Montana, it’s easy to feel as though you don’t have the ability or access to acquire corporate sponsors as easily as our counterparts in big cities. Barbara convinced me otherwise.

I was accustomed to soliciting program funds from corporate foundations, but had no experience seeking funds from corporate marketing budgets.  The workshop opened my eyes to how corporate marketing works and how corporate sponsorships of nonprofits benefits both entities. Following the training, I took advantage of the ½ hour free telephone conversation with Barbara herself and purchased her book and CD, Advanced Sponsorship Sales which includes guidelines and proposal templates.  The workshop, followup conversation and templates, gave me the tools to build our proposal. I started by making a list of every marketing opportunity our agency could offer to a business year-round.  It took a while to fine-tune the proposal, but I finally came up with the finished product and felt ready to start contacting businesses.  I began with major national corporations and did encounter some “screened calls” and unreturned phone messages.  Although I was not successful in receiving any cash awards, I did receive some product donations for our events.

I then decided to focus on local businesses that were already supporting our program in some way, setting up meetings to present our new marketing plan.  I had great responses and businesses were very interested in our proposal. Not a single business told me “no” on the spot.  In fact they all wanted to discuss the proposal and get back to me to. It took quite a few presentations and some proposal revisions but I am happy to say our agency acquired two new corporate sponsors at $10,000 each using this approach.

Our largest fundraiser of the year is Bowl for Kids’ Sake and our goal was to have a single “Presenting Sponsor” for this event. The first corporate sponsor we acquired, Montana State Fund, agreed to fill this role. They were given the Presenting Sponsor title as well as many marketing opportunities associated with our agency including exposure on our billboard, website, letterhead, flyers, pledge sheets, (both physical and electronic), t-shirts, and posters – all items we were already using to promote the event.   Additionally, after learning that State Fund had developed an injury reduction educational campaign, we suggested they use space at our event to distribute literature and talk about their program as part of their sponsorship. This benefit was unique to Montana State Fund, meeting one of their important educational goals, and was very easy for us to provide.  We learned at the training that whereas nonprofits have existing promotional opportunities for corporate sponsors, and those opportunities must be presented in the proposal and during your visit, it is critically important that you ask the potential sponsor about their goals and ideas for promoting the sponsorship as well and incorporate as many as possible.

Our second sponsor, Blue Cross Blue Shield of Montana, became a year-round sponsor of all Big Brothers Big Sisters events and received numerous marketing opportunities associated with our agency. In addition to our two new sponsors, our efforts with a corporate sponsorship program resulted in increased sponsorship amounts from several existing sponsors and new sponsorships at various levels.  This was all accomplished during the very lean economic period last year.

After every event, I send a thank you card or e-mail to our corporate sponsors thanking them for their support and show examples of the marketing benefits they received.  I believe it’s important to do this, not only to thank them but to keep them engaged in our program, strengthen our relationship, and build bridges to other potential sponsors. The corporate sponsors we have acquired at this level have been invaluable for our agency.  Not only do we receive crucial financial support, but the businesses receive innovative marketing opportunities with little extra effort on our part. They feel good about helping our agency resulting in a stronger commitment to our program within the business community.  It really is a win-win for us both!
 

MNA is hosting Barbara Harrington once again at a webinar on Feb 25th. Click here to learn how your organization can benefit from corporate sponsorships.

 Q&A with Barbara Harrington on Corporate Sponsorships  
by Barbara Harrington, co-founder of the Sponsorship Network

Barbara Harrington

This month, Consultant’s Corner features an MNA interview with Barbara Harrington. Barbara is co-founder of the Sponsorship Network and will be presenting the Creative Partnerships: Building Your Bottom Line With Innovative Corporate Sponsors webinar for MNA on Feb 25 (see the end of the article for details). Along with her business partner, Barbara has been helping nonprofits raise funds from corporate marketing budgets for 20 years. We asked her recently to share her knowledge about the basics of marketing sponsorships and the essentials of how a nonprofit should prepare to solicit funds from corporate marketing budgets.

MNA: What are corporate marketing sponsorship funds and why should nonprofits consider seeking them? BH: Diversifying funding is a necessity for most nonprofits, yet many of us are unfamiliar with the revenue “marketing sponsorships” can bring. Corporate marketing or sponsorship budgets are different from corporate philanthropy dollars. Corporations spend a tremendous amount on marketing and getting their products in front of their target consumers. Traditional advertising is costly and not as effective, hence the growing popularity of marketing sponsorships with nonprofits. Some may think there isn't a corporate structure in Montana…think again! Every product you see in every store is backed by considerable marketing dollars, and proven strategies exist for tapping into those funds for your organization. To be successful, nonprofits need to understand how corporations spend their marketing dollars and how to access these funds by setting values, clarifying benefits and ultimately documenting a return-on-investment for the sponsor.

 
MNA: Before seeking sponsorships, what top three things should nonprofits consider?

BH: First, Determine who is going to sell the sponsorship package. Someone will be responsible for delivering the pitch to potential sponsors. Will it be the development person, the executive director, or a board member? Making sure this is clearly defined will clarify who is going to champion the sponsorship efforts.

Second, properly value your sponsorship packages. While philanthropic donations typically offset direct costs, and requests are based on what it costs to run an event or program, marketing sponsorships are generally valued similarly to paid advertising. Sponsors are concerned about what exposure they receive in exchange for their sponsorship—their return on investment (ROI). Clearly understand the difference between sponsors and philanthropic donors, because they place different values on exposure and perceive benefits differently. The value of your sponsorship package will depend on the person to whom you are making your pitch.

And finally, ensure that everyone is on board in terms of delivering promised benefits to the company/corporation. Is everyone promising the same thing? What will be required of program staff to deliver the benefits, and is everyone informed and prepared to deliver the benefits you’ve promised? We only have one chance to make a great impression, and if benefits aren’t delivered as promised it can damage your organization’s reputation.

MNA: Are there other factors that should be in place before embarking on a sponsorship program?

BH: Here are some of the first questions I ask organizations considering a sponsorship program:

Has there been a directive to diversify funding? When everyone is in agreement, there’s a greater chance for success.

Do you have a Statement of Excellence? We advise organizations to pursue companies/corporations with a good reputation in the community. Identifying strategic partnerships can elevate your organization’s visibility and prestige in the community. Nonprofits should craft their own statement of excellence stating that they will deliver to the sponsor everything they’ve promised. Corporations can be hesitant to move forward with a nonprofit if they have been shortchanged on promises in the past.

What will you offer the company? Are benefits defined and are you able to deliver what you promise? And if you think you don't have anything to offer a sponsor, do a little research. It's often a matter of “inventing” a campaign or other deliverables, such as a tie-in with an awareness campaign (i.e. National Homeless Awareness Month) or exposure through social media. Good news is - you probably will not have to “invent” a special event. Existing special events offer interesting sponsorship opportunities, but they are not the only way to get started.

Is there a clear link between efforts and mission?
The company/corporation itself may not provide a logical connection (great if it does and it shouldn’t conflict with your mission!), but there needs to be a clear link to WHY you are pursuing the sponsorship from that particular company/corporation. Will the connection with that particular company/corporation bring in revenue, raise awareness about your program, and/or build advocacy with new decision-makers at the brand?

Do key decision-makers have a clear understanding of the difference between marketing sponsors and philanthropic donors?

MNA: Do you have any suggestions for approaching sponsors during this economy?

BH: Focus on sales benefits. According to the consulting firm IEG, corporate sponsorships with nonprofit organizations were up 3.1% in 2009. Generally, the return-on-investment (for the company) with sponsorships is much higher than with traditional advertising because it offers a way for companies to get straight to their targeted demographic. Organizations can utilize their own research and reporting to identify statistics that help them make promises on exposure and ultimately sell more sponsorships. Now more than ever, you have to deliver.

MNA: When it comes to sponsorships, is there one universal principle that all nonprofits should employ?

BH: Nonprofits need to understand what’s in it for the sponsor. And I don’t mean by way of compromise, but to save themselves money and time. If you understand what’s in it for them, you understand what prospects you should spend your time on. And take a look at who in the company/corporation you are working with. Different departments within a company have separate pots of monies and distinct objectives. If you understand and tailor your benefits to their different needs, you can build on existing relationships and tap into different funding sources in the same company/corporation.

Don’t miss Creative Partnerships: Building Your Bottom Line With Innovative Corporate Sponsors webinar with Barbara on February 25. You’ll learn about Building Innovative Sponsorship Packages - What works, what doesn't and how to stand out from the many other offers; Projecting Return-on-Investment For You & Your Corporate Partner – Key steps to assess potential and how to produce a Sponsorship Post-Analysis; The Fiscally Conservative Sponsorship Strategy – Understand how to chart a course for sponsorship success with this step-by-step strategy. Excellent case studies that bring it all into focus; Taking Your Sponsorships To A New Level – Keys to fulfillment, strategies for re-signing and up-selling. Register today!

Special Offer! The webinar includes email communication with Barbara during and immediately following the webinar and free, 1/2 hour individual consulting sessions by telephone with the presenter to be scheduled at the webinar.

Dear MNA Members and Friends: The U.S. Supreme Court recently issued a decision in Citizens United v. Federal Election Commission (decided January 21, 2010), that has confused some writers who are not as familiar with the important legal distinctions between different types of “nonprofits” that exist or with the differences between federal election laws that the Court changed and tax laws that the Court did not change.

 
Therefore, to make sure nonprofits here in Montana are aware of their full legal rights – and limitations – when it comes to participating in elections, the Montana Nonprofit Association (MNA) is attaching for your review a brief analysis that the National Council of Nonprofits prepared to help 501(c)(3) nonprofits avoid taking actions that could jeopardize their tax-exempt status.

MNA and the National Council of Nonprofits (to which members of MNA belong through your membership with us) share the concern that nonprofit leaders need to know not only what 501(c)(3) nonprofits cannot do, but also what we can do. That is why the brief analysis answers these questions:

• How does the recent Supreme Court case impact nonprofits?
• What can 501(c)(3) charitable nonprofits do in connection with political campaigns?
• What else can charitable nonprofits do?

For those who want to know more in general, the brief analysis provides several good references.

For those who want to know even more about the effect of the Supreme Court’s decision on 501(c)(3) nonprofits, the Alliance for Justice has published a solid overview.

Brian Magee
MNA Executive Director 

 

 

Guest Blog by Jan Lombardi, Executive Director, Governor’s Office of Community Service 

The Governor and the Montana Commission on Community Service believe that volunteers are vital to making our state’s communities stronger. With a timeless tradition of neighbors helping neighbors, Montanans believe that more can get done when working together. From our first Montanans traveling the prairie in search of food to the homesteaders establishing small town main streets, the state has continued to survive the changing times because people pull together. We know that community viability depends on strong state and local partnerships and the ability to stretch resources to span great distances and address diversity in need.

It is because of our strong collaborative frontier spirit, we believe, that Montana ranks 6^th in the nation for volunteerism. Did you know that in 2008, 34% of adults volunteered, resulting in an estimated $31.9 million hours of service to Montana? [Current Population Survey, U.S. Census Bureau for the Bureau of Labor Statistics, 2009].

What an exciting time for service. This past April, President Obama signed into law the Edward M. Kennedy Serve America Act for an increased national call to service to emphasize the opportunities for all Americans to do their part to address unmet needs and help their country. The Serve America Act authorizes financial support, currently under consideration by Congress, to increase AmeriCorps and other volunteer programs. This Act emphasizes the talents and opportunities for our “seniors” by now allowing those 55+ to serve in AmeriCorps and gift their education award to their children, grandchildren or foster children.

The Governor’s Office of Community Service is a resource for Montanans -- young and old -- to volunteer and become involved in their communities. The Governor’s Office of Community Service works with the Governor-appointed Montana Commission on Community Service to promote service and volunteerism in Montana. We hope that you will take time to visit ServeMontana our revamped website. It is designed to be user-friendly, and provide information on the Montana Commission on Community Service, funding, scholarships and a diverse range of volunteer opportunities, including AmeriCorps, Citizen Corps, Winter Ready Montana, and more. The most familiar of these programs is AmeriCorps, which provides volunteer opportunities throughout Montana. Links are offered to all of the Montana state AmeriCorps programs, including the Conservation Corps, Campus Corps, and Literacy Support Corps (WORD), Young Adult Service Corps (Jobs for Montana Graduates Foundation), Justice for Montanans project (Montana Legal Services Association) and Montana Energy Corps National Center for Applied Technology). There are also links to the four major AmeriCorps VISTA programs in Montana, as well as Senior Corps, and the Learn and Serve Program. Montana Citizen Corps is designed to engage individual volunteers through education, training and service. By harnessing this energy, the Citizen Corps make communities safer, stronger, and better prepared to respond to public safety issues. Be sure and check out the Map Your Neighborhood training to help you get to know your neighbors.

In response to the Governor Schweitzer’s call for action, two new statewide service campaigns were launched in 2009 -- Fire Ready Montana and Winter Ready Montana. Both initiatives helped Montanans be prepared with fire mitigation strategies and winter weatherization service projects to help citizens stay warm. Many volunteers are engaged in keeping their neighbors warm for a long winter season. Currently underway is the Winter Ready service campaign, which included a statewide coat drive with the First Lady and First Interstate Bank (19 locations) and a national organization One Warm Coat. To support the annual Warm Hearts Warm Homes initiative, a partnership with NorthWestern Energy, the Department of Public Health and Human Services’ Human Resource Development Councils and Montana Conservation Corps, AmeriCorps members are actively weatherizing homes. And while Senior Corps members are actively knitting hats and mittens, Campus Corp members are collecting coats and the National Center for Appropriate Technology’s energy corps members are helping communities with energy conservation and weatherization too.

We all know folks that make a big difference in many different ways. Here are just a few that inspire us all to get involved:

Young Adult Service Corps member in Fairfield, MT: “During the time I was in AmeriCorps I learned many values. My most accomplished story is the time I spent working with some Special Olympic athletes. One girl was preparing for a balance beam routine. I got to make up her routine, show it to her, and then help her practice it. We spent many hours over 3 months preparing. When the day finally came for her to perform we were both very excited! She gave me a little wink before she began and then performed flawlessly! The pride I had for both of us was something I will never forget!” 

Commission Vice Chair Kim Miske lives in a rural community of Wibaux, with a population of less than 600 people and travels to Helena, which is comparable to traveling from Philadelphia to Raleigh, NC. As a mother of three and a professional working in the legal field, decided she wanted to dedicate her time to serve on the Montana Commission on Community Service. “Living in a small community I see the value and importance of volunteerism. Here, service is simply a way of life. Recently our neighbor was in need to finish his harvest because of an illness. Many neighbors showed up and helped finish the harvest. I love being able to participate in and witness Montanans reaching out to make a difference,” Miske said.

The Governor’s Office of Community Service is looking forward to the Martin Luther King, Jr. Day of Service on January 18, 2010. During the 1950s and ’60s, civil rights leader Martin Luther King, Jr. recognized the power of service to strengthen communities and achieve common goals. Initiated by Congress in 1994, this commemorative day builds on that legacy by transforming the federal holiday honoring Dr. King into a national day of community service grounded in his teachings of nonviolence and social justice. The aim is to make the holiday a day ON, where people of all ages and backgrounds come together to improve lives, bridge social barriers, and move our nation closer to the “Beloved Community” that Dr. King envisioned. On this day, we will be participating in a national call to service to help solve hunger. In partnership with Anna Whiting Sorrell, Director for the Department of Public Health and Human Services, we will be conducting a statewide Feed A Neighbor campaign and invite all Montanans to mark the calendar for January 18^th and see how you can get involved.

Volunteering your time is a great way to make a positive impact in your community. Whether helping your neighbor shovel snow or using your skills and experience to benefit a nonprofit organization, you will find that the simple act of lending a hand has rewards beyond measure. To learn more about how you can get involved and help your community, visit www.serve.mt.gov. To share your story of service to inspire others, please e-mail them to serve@mt.gov.

Jan Lombardi
Executive Director
Governor’s Office of Community Service
Work: 406-444-2573
Email: jlombardi@mt.gov

 

Guest Blog by Barbara Anthony, Director of Development, Indian Law Resource Center Year-end is a popular time for making charitable gifts to your favorite non-profits. Now is the time to consider how you want to fulfill your charitable goals and to take action so that the needed documentation is complete by December 31, 2009.

 
The two major categories of charitable giving are Current Gifts and Planned Gifts

Current Gifts
Gifts made this year will allow you deductions on your 2009 IRS tax return. Gifts are always appreciated for general funding needs or you may designate to specific programs. For example, at the Indian Law Resource Center donors often choose to fund endowments, one of our specific projects, or general support.

1. Cash – Gifts of cash given by check, money transfers and credit cards enable the donor to claim an income tax deduction for the full value of the gift.
2. Securities – Stocks, bonds, and mutual funds, owned for a minimum of one year, may be donated by contacting your fund manager to make the transfer.
   1. Appreciated Stock – transfer stock directly to the non-profit at current market value and avoid capital gains. Example; stock cost basis $2,000 with a current market value of $4,000. Your gift and tax deduction is $4,000.
   2. Depreciated Stock – sell stock, take a capital loss, donate funds and receive a deduction.
3. Real Estate – A primary or secondary residence, farm, vacation home, commercial building or undeveloped parcel of land are welcome gifts. The real estate may be used by the non-profit or they may sell it and utilize the funds. Donated appreciated real estate allows a deduction at the current market value and avoidance of a capital gain tax.
4. Tangible Personal Property – Collections, art, automobiles, recreation vehicles, equipment, patents, copyrights, etc. may be charitable gifts. Tax deductions are dependent on the related use for the non-profit.
5. Charitable IRA Rollover – Traditional IRAs and Roth IRAs may now be donated directly to qualified non-profits. You must be 70½ or older on the day of the gift. The amount is excluded from Federal income taxes, meaning that the IRA distribution is not included as taxable income. Donating your annual IRA payment satisfies the required minimum distribution. Up to $100,000 per person, per year is allowed for 2009. For this type of gift more than the standard 50% of income may be donated.

Planned Gifts
These gifts are made from current assets through a contract or trust, and usually provide annual income for life to the donor and a secondary beneficiary. At the death of the last income beneficiary the remaining amount of the gift is distributed to the non-profit. Most planned gifts are irrevocable, meaning they are permanent.

Planned giving is a process of making plans now for a future gift.

• A donor generally makes a contribution from their assets or estate.
• A donor generally receives current income and tax benefits.

Charitable Bequests
This is a gift at the time of estate distribution. A bequest is the simplest type of planned gift and one of the easiest to implement.

• A donor can leave gifts to their favorite non-profits by including a bequest in their Will or Living Trust and designating the organization as a beneficiary.
• Bequests are revocable, they can be amended whenever desired and at any point of life.
• Existing bequests can be easily modified with an amendment that specifies a dollar amount, percentage or remaining amount of an estate, or specific property to be donated.

Charitable Gift Annuity
A legal contract for which a donor transfer assets, usually cash or stock, and in return receives annual fixed payments for the rest of their life. At the completion of payments the remainder goes to the designated non-profit.

• Fixed payments for life – a gift annuity contract provides fixed payments to one or two individuals for life.
• Rates are determined by the donor’s age (rates are higher for older donors). The American Council of Gift Annuities set the rates annually.
• Avoid capital gains when funding with appreciated stock.
• A portion of each gift annuity payment to the donor is tax-free.
• Donor receives a current federal income tax deduction and may utilize the Montana Tax Credit.
• Example rates: Age Rate
  65 5.3%
  70 5.7%
  75 6.3%
  80 7.1%

Deferred Charitable Gift Annuity
The deferred charitable gift annuity is similar to a charitable gift annuity, but with payments deferred to begin at a future date and at a higher interest rate.

• Example rate:
  Annuitant age at time of making gift: 65
  Annuitant age at time of first payment: 75
  Annuity rate: 9.6%
  
  

Paid-up Life Insurance Policy
A life insurance policy for which all premiums have been paid may be a charitable gift. This usually entitles the donor to a current deduction equal to the cost of replacing the policy with a single premium life insurance policy at the donor’s current age. Upon distribution the full face value goes to the designated non-profit as beneficiary.

Charitable Life Estate Agreement
A donor has a deed executed which transfers a primary or secondary home, cabin, ranch or farm to the non-profit. The donor retains a “life estate”, which is the right to live in the home and enjoy the full use of the property or income for the rest of their life, after which all rights to the property goes to the non-profit. At the time of the gift, the donor and non-profit enter into a maintenance, insurance and tax agreement specifying the donor’s responsibilities with respect to the property. Payment of maintenance, insurance and taxes for the years of the life estate is the donor’s responsibility.

Pooled Income Fund
This is a fund which pools donor assets of cash or securities for investment with other contributors. The fund provides an annual income to the donor for life. The remaining fund shares are distributed to a designated non-profit when the donor passes away.

Charitable Remainder Trust
A trust is established with assets from a donor. The trust provides payments for their life or a specified time period, and then distributes the remainder to the non-profit.
Options:

• Charitable Remainder Annuity Trust – donor receives an annual fixed payment of the trust’s fair market value, determined annually.
• Charitable Remainder Unitrust – donor receives an annual predetermined fixed percentage of the trust’s fair market value. Payments are adjusted with the investment performance of the fund.

Charitable Lead Trust
A trust is established by assets transferred by the donor and invested by a trustee. Each year the trust pays an amount to the charity for a term of years. At the completion of the term, the remainder interest then transfers to private beneficiaries named by the donor, usually family.
Options:

• Charitable Lead Annuity Trust – provides a fixed dollar amount each year to the non-profit. The amount is determined when the trust is established, and continues to the term of the trust.
• Charitable Lead Unitrust – provides a fixed percentage of the unitrust’s value, and is revalued annually, to the non-profit.

Montana Tax Credit
Montana law allows you to pay less on Montana state income taxes when you give a qualifying planned gift to a Montana charitable endowment fund.

• The tax incentive is an income tax credit rather than a charitable gift deduction.
• Individuals are allowed a tax credit against state taxes in an amount equal to 40% of the present value of a planned gift made by a Montana tax payer to a qualified Montana endowment.
• Corporations may receive a 20% tax credit on outright gifts (planned gift not required).
• The maximum credit is $10,000
• Tax Credit Forms: MT QEC -09

This information is provided as an educational service. Your financial advisors should always be consulted regarding your plans.

Contact Information:
Barbara Anthony
Director of Development
Indian Law Resource Center
406-449-2006 http://www.indianlaw.org/