‘Uncertainties’ in Nonprofits Are Uncertain

Rande Richardson

One of the most frequent words used when discussing the future of nonprofit organizations is “uncertainty.” Nearly every week I hear speculation that the next generation won’t choose to support the work of nonprofits in the same way their parents, grandparents and great-grandparents did. Others wonder whether the work and mission of some nonprofits will be relevant to those in line to lead them. While I remain optimistic based on what I see through the Community Foundation’s Youth Philanthropy Council, Young Professional’s LEAD Council and Youth Giving Challenge initiative, I believe that “business as usual” for some local charitable organizations may be turning the page on its last chapter.

                It would have been difficult to predict 25 years ago that the Syracuse Symphony would cease to exist after 50 years, but we all know what happened in 2011. While there were likely multiple reasons for this, one of them had to be the changing landscape and the growing disparity between the mission, its sustainability and those willing to support it.

                At the Community Foundation, we continue to look for opportunities to encourage and support the thoughtful consideration of nonprofit reorganization through mergers or other affiliations, as well as sharing of resources. Indeed, there have been successful examples of preservation of mission over entity, including the Teen Center finding sustainability under the auspices of the Children’s Home of Jefferson County or Meals on Wheels finding a natural collaboration with the Watertown Urban Mission. The Philanthropy Center now allows five nonprofits to share space and other resources, with one more expected soon. More of these will happen. Some organizations may even dissolve completely where the mission has become increasingly irrelevant or obsolete or another organization has found a more sustainable way to fulfill that same purpose.

                All is not lost, however. When I meet with charitably-inclined citizens looking to perpetuate their giving for a specific nonprofit, I will usually ask: “Is it the organization you want to support or is it WHAT THEY DO that you want to support?” There is a distinction. In most cases, the donor acknowledges that it is the work and mission they are supporting, not the organization itself. While they may be sentimentally or emotionally attached to the current provider of that work and mission, they recognize that it is the result that they want to see sustained through their gift or bequest.

                While community foundations exist to support diverse aspects of a region’s quality of life, what truly makes them unique is their ability to maintain appropriate flexibility and adaptability through something called “variance power.” In 1976, the Internal Revenue Service issued Treasury Regulations that endorsed and codified the variance power as an essential feature of community foundations.

                Back to the Syracuse Symphony illustration. Many years ago, a committed group of residents teamed up to raise funds to establish an endowment to support Syracuse Symphony performances in the Watertown area. That fund was entrusted to the Community Foundation, and through prudent management, has grown to nearly $700,000. Because of this, when the Syracuse Symphony officially dissolved, the Community Foundation’s governing body was able to deploy those funds to support live orchestral music performed by other groups. The charitable purpose endures as each year the fund supports performances by the Orchestra of Northern New York, among others. Recently, a donor created an endowment to support their church, with provisions for three other nonprofit organizations if the church should someday face an unforeseen end. The might and muscle of this variance power cannot be overstated, both for the purpose and the donor.

                I will always feel strongly that the best gift is an enduring one, and the future of the nonprofit sector will increasingly rely on that long-term support. As organizations shuffle, the sacred trust and stewardship of donors who want to see vibrant, healthy, happy communities must be positioned to do the most good, regardless of the organization doing it. If not for variance power, we run the risk of not only losing the charitable resource, but providing an obstacle for perpetuating legacies that can make a difference, despite the nonprofit landscape of the future.

                Remaining relevant in a world that, inevitably, will change, applies not only to nonprofit organizations, but also to the resources that are used to support them. Part of that relevancy includes providing an approach that balances the desire for specificity and the desire for thoughtful flexibility over time so the larger charitable intent remains intact. The standard for variance action is extremely high, however, when it is needed, its value to the donor, the nonprofit sector and the needs of our ever-changing community landscape is even higher.

Rande Richardson is executive director of the Northern New York Community Foundation. He is a lifelong northern New York resident and former funeral director. Contact him at rande@nnycf.org.