Charitable Disclosure

Local media lag when it comes to holding nonprofits accountable.



Charitable foundations do much good work, but they can also be as unaccountable as the federal bureaucracies they often resemble," said The Wall Street Journal in an editorial this week. It went on to praise Rep. Harold Ford for co-sponsoring legislation focusing on salaries, travel, and office furnishings counted as "charitable spending."

Needless to say, Ford, a Democrat, is not exactly a house pet of the conservative Wall Street Journal. But Ford and the Journal recognize something that most of the Memphis media, notably The Commercial Appeal, don't. Namely, that disclosure of salaries and expenses at foundations and nonprofits transcends partisanship and is simply good government and good reporting.

In 1996, this newspaper published a long story on local nonprofit agencies that listed the salaries and benefits, along with the revenues, of a representative sampling of 40 organizations ranging from hospitals to colleges to the Boy Scouts of America.

It wasn't an original idea. Other weekly newspapers had done it, and we got the idea and some helpful pointers at an annual convention. The main thrust of the story was that nonprofits do a lot more than prepare food baskets for the needy.

It was no picnic. Some of the people at the top were our advertisers, sources, and friends. Several organizations strongly resisted giving our reporters access to their federal 990 tax forms, even though the form says in the upper right-hand corner, "This form is open to public inspection." Many of them called in their lawyers, dragged their feet, provided outdated information, or refused to let us make copies. One invoked "the privacy act."

We repeated the survey for two more years, to include more organizations and because it was popular with readers. It seemed both fairer and more informative than spot-reporting of a single salary or expense without context just because it happened to be in the news. There was plenty to go around, and our hope was that other local media organizations would do the same thing. Newspapers are especially well suited for this kind of detail-laden project. But The Commercial Appeal, with its bulldog editor and its lighthouse logo and its platitude about giving light and all that, never did.

After a few years we climbed off that particular hobbyhorse and went on to other things. But the influence of nonprofit organizations and foundations in the public sector continued to grow, and it is still growing. The Center City Commission, the Riverfront Development Corporation, and the Memphis Convention and Visitors Bureau receive taxes or fees and influence policies and projects such as the downtown taxing district, FedExForum, and riverfront redevelopment. Ambitious politicians have learned to get themselves named to their boards if they want to be where the action is.

The Sports Authority, the Memphis Redbirds Foundation, Memphis Development Foundation (Orpheum), and the Blues Foundation promote and seek financial support for tourism, events such as Spring Fling, and music and cultural events. The Plough Foundation, Hyde Family Foundation, and Partners in Public Education (PIPE) seek to influence policy on public education.

In recent years, top city employees including Rick Masson, Dexter Muller, John Conroy, and Benny Lendermon have found that they can make as much or more money with fewer headaches working for a local nonprofit. It is very likely that former county mayoral aide Tom Jones would not have come to grief if he had done the same four years ago. Most of the salaries are competitive and reasonable. But disclosure only works if the media do their part, which they don't.

Two years ago, the Flyer reported that the Redbirds Foundation was spending more than $400,000 on its top two salaries and just over $200,000 on inner-city baseball. The rest of the media yawned. Just a few weeks ago, the CA said that the Sports Authority is passing the hat in the wake of Spring Fling but lamely reported a ballpark figure of $200,000 for staff salaries and expenses. Executive director Tiffany Brown makes $120,000. Likewise, when PIPE lectured the city school board about spending its money efficiently, it became appropriate to examine PIPE's own spending in a year when PIPE has frozen its support for public schools. Interim PIPE director Ethele Hilliard declined to disclose her consulting fee but said it is less than the $100,000 to $125,000 a year plus bonus that PIPE plans to pay a new director.

H.L. Mencken proposed a simple standard: No publicity and no public funds for any organization until every penny of salaries and expenses is freely disclosed. If The Wall Street Journal and Harold Ford can agree, maybe the CA and the rest of the Memphis media can put down their pom-poms and join in. But don't hold your breath.

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