From: Nancy M. Brown, president/CEO, Winona Community Foundation
The last quarter of the year is often considered “the giving season.” It’s a time when people think about the various charities they like and want to support. It is also the time when most charities send out their annual appeals. This year is no different. Yet, it is. Many charities canceled traditional fundraising events. Others had to close their doors to visitors. Still others took on greater needs without corresponding increases in revenue or funding.
I have worked in the world on nonprofits for more than 25 years, specifically in the field of fundraising. One of the most difficult gifts to secure is the unrestricted gift, yet it is the most essential to the operations of the charities we love. Increasingly donors want to direct their giving or will expect that every penny they donate goes directly to “the cause” and not administration. And therein lies the conundrum. The charities you love need operating funds.
With few incredibly rare exceptions, no organization operates without overhead. Overhead includes essential investments charities must make to deliver on their missions. Beyond heat, electricity, and rent, these investments include training, planning, evaluation, IT systems, and fundraising. Without these essential investments, the mission cannot be delivered or will fall short.
Why am I sharing this? I’m sharing this in response to the recent letters to the editor regarding Winona State University Foundation’s recent implementation of a one-percent administrative fee on its funds. I cannot profess to know all the details or the ins and outs of this decision. However, my professional experience tells me it is a wise one. Investments in donor software and systems, investments in capital campaigns, investments in donor stewardship, investments to ensure staff are contemporary on best practices and laws regarding fundraising only serve to improve the organization and grow the assets available to invest into the university.
In 2013 GuideStar, BBB Wise Giving Alliance, and Charity Navigator wrote an open letter to donors in a campaign to end what they call “The Overhead Myth.” You can find it at www.overheadmyth.com. Giving is a joyous action and should be encouraged in all forms. This year, consider how your unrestricted gift will have the greatest benefit to the charities you love.