Weekly Reader June 3, 2013

Top reads we’re recommending this week:

The D5 Coalition is an alignment of 18 infrastructure organizations that are working to make the philanthropic sector more diverse, equitable, and inclusive. The group’s 2013 annual report looks at a number of case studies where foundations have implemented innovative strategies to accomplish this goal.

Will What Was Said in Detroit Stay in Detroit?

“Foundations talk of ‘our’ work, but the truth is, we don’t do any work. Not really. Our grantees do all the work.”

What problem are you trying to solve? (Lucy Bernholz)

Finding solutions depend on how you define the problem. If the current mess at the IRS is truly a case of civil servants or elected politicians infringing on the free speech of specific political groups, that’s a problem for law enforcement and the courts. So far, what appears to have been demonstrated is incompetence and mismanagement, not crimes.

The High Hidden Costs of One Organization’s Fundraising (Nonprofit Quarterly)

The analysis of the numbers listed in the Form 990 shows that it costs LELDF 85 cents to raise a dollar, meaning that, of every dollar donated, 15 cents go to support the mission. That’s obviously a very high ratio; in our article cited above, those nonprofits that did report their fundraising costs averaged seven cents to raise a dollar, sending 93 cents to support the mission.

Only a third of charitable contributions go to the poor (Washington Post)

Sussing out who gets what from various tax breaks is tricky enough, but it’s nearly impossible for the charitable tax deduction. On the most basic analysis, it seems to help the rich. After all, they are more likely to itemize their tax returns, and the deduction is worth more for people in higher tax brackets. That’s why the CBO found that $33 billion of the $39 billion deduction went to the top quintile, and that the top one percent gets more out of it than any other group, as a share of income.