WASHINGTON — Thousands of small charities in danger of losing their tax exempt status because they missed a tax filing deadline were given a reprieve Monday by the Internal Revenue Service.
A 2006 law required nonprofit organizations with receipts of less than $25,000 to file tax returns for the first time in 2007. If charities failed to file for three years, they were going to lose their tax-exempt status. The law excludes churches.
The deadline for filing a return was in May. IRS Commissioner Doug Shulman said the agency is extending the deadline to Oct. 15.
The IRS has identified 325,000 charities that did not file, but many may be defunct. The agency posted the names and last-known addresses for these charities on its website, www.irs.gov.
“It’s really important for small charities to pay attention to this announcement. These groups do great work in communities across the United States and are vital to the vibrancy of our nation,” Shulman said. “The last thing we at the IRS want to do is to have these groups lose their tax exempt status because they haven’t filed a short simple form.”
Charities losing their tax-exempt status would no longer be eligible to receive tax-deductible donations. The IRS plans to publish a list of organizations losing their tax-exempt status in early 2011.
Charities with gross annual receipts of $25,000 or less can keep their tax-exempt status by filing a short tax form. Larger charities with 2009 receipts up to $500,000, and assets up to $1.25 million can keep their status by filing delinquent returns by Oct. 15 and paying a fee ranging from $100 to $500, the IRS said.
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MCKINNEY, Texas — Ben Sater had vowed that before he went off to college, he would raise $1 million for the Dallas children’s hospital where he had received free treatments as a child.
After eight years’ worth of fundraising golf tournaments for kids, the soon-to-be Austin College freshman has reached the goal, with nearly $19,000 to spare.
Organizers announced Monday that they’ve raised $1,018,842 for Texas Scottish Rite Hospital for Children, an orthopedic center that treats patients free of charge.
“We got it,” the now 18-year-old told the group of kids gathered in McKinney on Monday for the second KidSwing tournament of the summer.
Later, smiling under the hot summer sun as the kids who spent the morning golfing splashed in the pool, he said he initially didn’t even consider the possibility of raising so much money. The first tournament in 2003 raised about $20,000.
Sater said, “$1 million never even crossed my mind.”
But over the years, the tournament grew in popularity — the McKinney location was added three years ago after the original Dallas tournament kept filling up. Once the tournaments had raised around $500,000, Sater realized $1 million was possible.
The tournaments are for kids 7 to 18, so this was Sater’s last year to play. But he said the tournaments will go on and he’ll still be involved.
“It’s a little bittersweet,” said his mother, Kim Sater.
She said one thing that’s always amazed her was the amount of money the kids were able to raise. One girl, who has also been a patient at the hospital, has raised more than $50,000, she said.
To play, each child is asked to raise $100 by getting sponsorships from friends and family. This year, about 140 kids participated in the tournament Monday in McKinney, located just north of Dallas, and more than 300 played in the Dallas tournament in June.
J.C. Montgomery Jr., president of Scottish Rite, said that the tournament does more than raise money, it also makes many new friends for the hospital.
He said the money raised this year will go to help patients who have hand issues.
The tournaments, he said, stand out among fundraisers for the hospital because of the involvement of children.
“They run it; they raise the money,” he said.
The tournament has a kids committee and an adult committee. The children’s duties include choosing the T-shirt design and fundraising prizes and helping set the day’s program.
Sater, who graduated from high school in Plano in June, became a patient at Scottish Rite at the age of 3 when he had surgery on a pinky and thumb for a condition called trigger finger, which causes fingers to lock or catch in a bent position. He had surgery again at the age of 10 on three more affected fingers.
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It’s been two years since Bill Gates left his day-to-day role at Microsoft to concentrate on supervising the Bill & Melinda Gates Foundation—and his new enterprise is booming. Headquartered in a converted check-processing center in Seattle’s Eastlake neighborhood, the 10-year-old foundation plans to move into a 900,000-square-foot campus and visitors’ center near the city’s Space Needle next spring. The Gates Foundation opened a London office this year; it also has offices in Washington, Delhi, and Beijing, and 830 employees around the world, up from about 500 in 2008. With assets of $33.9 billion as of Dec. 31, 2009, and America’s two richest people—Gates and Warren Buffett—as trustees, the foundation plans to spend $3 billion in the next five to seven years on education. If there’s such a thing as a charity behemoth, the Gates Foundation is it.
While its efforts in global health are widely applauded, its record in America’s schools has been more controversial. Starting in 2000, the Gates Foundation spent hundreds of millions of dollars on its first big project, trying to revitalize U.S. high schools by making them smaller, only to discover that student body size has little effect on achievement.
It has since shifted its considerable weight behind an emerging consensus—shared by U.S. Education Secretary and Gates ally Arne Duncan—that quality of teaching affects student performance and that increasing achievement is as simple as removing bad teachers, identifying good ones, and rewarding them with more money. On this theory, Gates is investing $290 million over seven years in the Tampa, Memphis, and Pittsburgh school districts as well as a charter school consortium in Los Angeles. The largest chunk of money, $100 million, will go to Tampa’s Hillsborough County school district, the eighth-largest in the U.S., with 192,000 students and 15,000 teachers. These carefully selected programs, which will favor or penalize teachers depending on whether students make larger or smaller gains than their test scores in prior years would have predicted, are intended as models that, if proven successful, can be rolled out nationwide.
The Gates agenda is an intellectual cousin of the Bush administration’s 2002 No Child Left Behind law, which required all public schools—though not individual teachers—to make “adequate yearly progress” on student test scores. Some opponents of No Child Left Behind questioned its faith in data; are scores too narrow a gauge of how well kids are learning? Gates sees nothing wrong in relying on quantitative metrics. “Every profession has to have some form of measurement,” he said in a late June interview with Bloomberg Businessweek. “Tuning that, making sure it’s fair, getting the teachers so they’re enthused about it” are the keys.
Still, the prospect of such measurement makes some educators and academic researchers uneasy. They contend that factors such as school leadership and culture exert a powerful influence on student achievement. Moreover, rating individual teachers based on their classroom’s test results may be better suited to little red schoolhouses than today’s large urban schools, where teachers team up, aides and tutors pitch in, and students come and go frequently.
While cities such as Denver and Cincinnati have experimented with paying teachers for performance, the Gates initiative—called Intensive Partnerships for Effective Teaching—marks the largest and most comprehensive effort to evaluate teachers in all grades and subjects based on student test gains. “The people at Gates believe there is a window right now,” says Michael S. McPherson, president of the Spencer Foundation, which supports education research. “They have in Washington an administration that’s broadly sympathetic to their view. They have the attention of the American people, wanting dramatic improvement in the schools. Bill and Melinda Gates want to see results—not just in their lifetimes, but in the next few years.”
Small schools, false start
The last thing you’d expect from an organization headed by Bill Gates is a math mistake. Yet, according to Wharton School statistician Howard Wainer, the foundation may have misread the numbers when it arrived at its first prescription for American education. Wainer, who used the foundation as a case study in his 2009 book, Picturing the Uncertain World, says it seized on data showing small schools are overrepresented among the country’s highest achievers and started pouring money into creating small high schools and subdividing big ones. Tom Vander Ark, a former schools superintendent in Washington state who was tapped to oversee the foundation’s educational arm, was—and remains—a booster of small schools. The Gates Foundation declined comment on Wainer’s assertion and research.
From Pierre S. du Pont, who gave more than $6 million to train teachers and build 120 public schools in Delaware in the 1920s, to the Rockefeller family, which funded child development research that helped lay the groundwork for the Head Start program, corporate leaders have long promised to ride to the rescue of public education. One of the highest-profile efforts came in 1993, when publisher Walter Annenberg gave $500 million—matched by $600 million in gifts from other sources—to strengthen urban, rural, and arts education, only to be stymied in some school districts by rapid changes of leadership and direction.
In the past, says University of Michigan historian Maris A. Vinovskis, benefactors “were not as prescriptive about how they wanted their money spent.” Now a new generation of philanthropic billionaires, including Gates, homebuilding and insurance entrepreneur Eli Broad, members of the Walton family that founded Wal-Mart Stores, and former hedge fund manager Julian Robertson, want public education run more like a business. Charter schools, independent of local school districts and typically free of unionized teachers, are one of their favorite causes. “We don’t know anything about how to teach or reading curriculum or any of that,” Broad said last year at a public event in Manhattan. “But what we do know about is management and governance.”
Small schools promised an alternative to the impersonal bureaucracy of traditional high schools, which Gates in a 2005 speech proclaimed “obsolete.” But according to Wainer, adherents overlooked a troublesome fact: Small schools are overrepresented among the lowest as well as highest achievers. Why? Because the smaller a school, the more likely its overall performance can be skewed by a few good or bad students.
Wainer says big high schools, for all their problems, outperform small ones. Scale lets them offer more advanced classes, electives, and extracurricular activities. With Gates funding, one Denver high school split into three and lost so many students that it shut down in 2006. It reopened a year later as a single school, without the foundation’s support.
In November 2008, Bill Gates publicly backtracked, acknowledging in a speech in Seattle that “simply breaking up existing schools into smaller units often did not generate the gains we were hoping for.” Still, the foundation has not renounced its original mission. Gates credits smaller schools for their proficiency at boosting attendance and decreasing violence. “So we absolutely believe in the small schools thing,” he says. “Calling that a failure is not fair.”
The experience taught the foundation the value of humility. “The Gates people are dramatically more attentive to evidence,” says McPherson of the Spencer Foundation, “and more willing to consider that they need to keep learning than they were when they started out.”
As it became clear that small schools alone weren’t the solution, Gates installed new leadership, naming Vicki Phillips, who served as Secretary of Education for the state of Pennsylvania and superintendent of schools in Portland, Ore., to replace Vander Ark in 2007. After a yearlong reassessment, Phillips swung the foundation behind the next big wave in education reform—evaluating teachers based on student test score gains. One of her key moves was enlisting Harvard University economist Thomas Kane as deputy director of education for data and research. Kane had co-authored an influential 2006 study of 150,000 students in grades 3-5 in Los Angeles that analyzed just how vital teacher quality is to student performance. Having a teacher ranked in the top 25 percent four years in a row “would be enough to close the black-white test score gap,” the study found. It made a strong recommendation seemingly borrowed from corporate America: Teachers who ranked in the bottom quarter after their first two years in the classroom should be fired.
The Gates-funded plan in Tampa will put teachers on the spot starting this school year. Of the $100 million that the foundation is pouring into the Hillsborough County school system, at least $60 million will go to teachers. With that cash comes a new evaluation system: 40 percent of the grade will be based on student learning gains as measured by standardized tests, 60 percent on observations by the school principal and teachers from elsewhere in the district. Highly rated teachers could earn as much in their fourth or fifth year as colleagues with 20 years’ experience who opt to stick with the traditional pay scale. The aim is to spur teachers to adopt best practices and learn from colleagues who are more effective in handling disruptions or instilling particular concepts, according to Gates. “It’s an incentive to identify the exemplars,” he says. Teachers at the bottom will have to improve or face immediate consequences. “We anticipate there will be teachers who are no longer in the profession in Hillsborough County,” says schools superintendent MaryEllen Elia. “They will be told, ‘This is not the place for you.’ ”
Hillsborough currently terminates 0.5 percent of its teaching force annually. More than 99 percent of Hillsborough teachers were rated satisfactory or outstanding in 2007-2008, and 98 percent of those eligible received tenure. So how will a group that’s received almost nothing but positive reviews react to a more rigorous evaluation based on student improvement? One logical response is to narrow instruction to the content and techniques needed to pass tests, at the cost of encouraging creativity, curiosity, or complex analysis. “This is likely to take teaching to the test to a new level,” says Harvard education professor Daniel Koretz.
Wainer, the statistician who spotted the mathematical fallacy behind the small schools movement, is also skeptical. “It’s conceivable you could get a value-added score to work at an elementary level, but how can you do it at a high school?” he asks. “How should my physics gain score match against your French score? Was Mozart a better musician than Babe Ruth was a hitter?”
Judging teachers on student performance creates a litany of such practical problems, from how to assess progress in subjects such as art, shop, or phys ed to accounting for the mobility of inner-city families. In Memphis, where Gates has invested $90 million, schools superintendent Kriner Cash says one-third of students move during the year, which means their gains can’t necessarily be credited to one school, much less one teacher. Giving several tests a year can sort out each teacher’s contribution, he says. Still, ratings may be tainted if frequent transience requires teachers to integrate newcomers and adjust to departures.
Teacher report cards
Studies of teacher effectiveness show much variability. Few instructors stay at the top or bottom statistically year after year. A study of five Florida districts from 2000 to 2005, including Hillsborough, found that only half the teachers ranked in the top 20 percent one year were in the top 40 percent the next. Tying teacher jobs to student gains “isn’t as simple and straightforward as some people think it is,” says Gene Wilhoit, executive director of the Council of Chief State School Officers in Washington, a recipient of Gates funding. “We’re a bit concerned that others aren’t raising these kinds of issues. We’re also concerned, if you do raise these issues, it’s seen as making excuses or pulling back from commitments.”
Gates’ approach risks alienating teacher unions, which typically have negotiated pay based on seniority and advanced degrees. In April, under union pressure, Florida Governor Charlie Crist vetoed a plan that would also have tied teacher salaries to test score results. When Bill Gates addressed the national convention of the 1.5 million-member American Federation of Teachers on July 10 in Seattle, a small group of teachers walked out, though he also received several standing ovations. “One of the things that we learned through the small schools initiative is that we’ve got to work with the unions,” Melinda Gates told Bloomberg Businessweek. “That takes a lot of up-front work, but it’s absolutely crucial.”
As a condition of funding, the foundation required Hillsborough and the other districts to cooperate with local unions. In a union-friendly move, Hillsborough agreed to tell teachers in advance when peers will observe their lessons, making positive evaluations more likely. By contrast, in a nationally acclaimed program in Cincinnati, teachers give two lessons before evaluators without prior notice.
“If you tell teachers ahead of time that they’re going to be observed, they’ll just say to the class, ‘OK, kids, somebody’s coming in, I expect you to behave, raise your hand when you ask a question, and if you do well we’ll have a party the next day,’ ” says JoAnn Parrino, a teacher at Chamberlain High School in Tampa. “The only way to tell a good teacher is to go into their classroom spontaneously.”
David Steele, chief information and technology officer for the district, says the decision to notify teachers was made because it didn’t want to “play gotcha.” Also, he says, a pop-in can waste the evaluator’s time: “What if the teacher is showing a movie that day?”
Despite the opportunity to increase their income, teachers nationwide are skeptical of Gates’ agenda. In a national survey of 40,000 teachers co-sponsored by the Gates Foundation and released in March, 36 percent said that tying pay to performance is not at all important in retaining good teachers, while only 8 percent said it’s essential. And 30 percent said it would have no effect on student achievement—triple the proportion that said it would have a very strong impact.
“The Gates Foundation was very surprised,” says Randi Weingarten, president of the American Federation of Teachers. “They asked the question in a way they thought they’d get a positive result, and they got a very negative result.” On the contrary, says Gates spokesman Christopher Williams, the foundation was heartened that a significant portion of teachers do believe in merit pay.
In 2007, a year after the foundation gave $21.6 million to Chicago public schools, Melinda Gates toured the system with its then-chief, Arne Duncan. “I was extremely impressed with what he was doing,” she says. “We started our relationship then.”
Friends in Washington
Today, the Gates Foundation and Education Secretary Duncan move in apparent lockstep. Two of Duncan’s top aides, Chief of Staff Margot Rogers and Assistant Deputy Secretary James H. Shelton III, came from the foundation and were granted waivers by the administration from its revolving-door policy limiting involvement with former employers. Vicki Phillips, who heads the foundation’s education programs, and Duncan participated from 2004 to 2007 in the Urban Superintendents Network, a group of a dozen school leaders who met twice a year at weekend retreats co-funded by Gates.
When the federal government made $4.35 billion in federal Race to the Top awards available—favoring applicants that agree to link teacher pay to test score gains, increase the number of charter schools, and adopt common curriculum standards—the Gates Foundation paid for consultants to prepare applications for 24 states, as well as the District of Columbia. One of two winners announced so far is Tennessee, which had help from Gates. The state will receive about $500 million from the Obama administration.
The Gates Foundation, which bankrolled development of the common curriculum standards, is also funding outside evaluations—by the Thomas B. Fordham Institute in Washington and the Massachusetts Business Alliance for Education—of those same standards. The Boston-based business group is expected to release its report before the Massachusetts Board of Elementary & Secondary Education meets on July 21 to choose between the new standards preferred under Race to the Top and revisions to existing state criteria, considered among the most rigorous in the country.
Williams, the Gates spokesman, says the foundation frequently pays for independent assessments of its programs and doesn’t seek to dictate their conclusions.
“The Gates folks are well aware of our independence and, I think, incorruptibility,” says Chester E. Finn Jr., president of the Fordham Institute, a nonprofit education think tank. Still, Finn says, the alliance between the government and the country’s richest foundation could discourage dissent. “I’ve become suspicious of the phrase ‘public-private partnership,’ ” he says. “It comes off the tongue as an undisputed good thing. It’s actually a disputed good thing.”
As a private entity that doesn’t answer to voters, Gates can back initiatives that are politically dicey for the Obama administration, such as uniform standards, says Jack Jennings, director of the Center on Education Policy. In the past, states’ rights advocates have blocked federal efforts for a national curriculum. Gates “was able to do something the federal government couldn’t do,” Jennings says.
At the same time, the rapport between the federal government and the largest private education funder is raising concerns that competing ideas are getting squeezed out. “It’s like a mind meld between Arne Duncan and the Gates Foundation,” says former U.S. Assistant Education Secretary Diane Ravitch, whose 2010 book, ‘The Death and Life of the Great American School System,’ criticizes Gates for exerting “vast power and unchecked influence” over American education. If she had access to resources like Gates’, says Ravitch, she’d save parochial schools that have been effective for inner-city kids but are suffering from church cutbacks.
The alliance between the Gates Foundation and the government raises other issues, too. Drew Gitomer, a researcher with the Educational Testing Service, says the foundation may be rushing a $45 million study that involves videotaping math, English, and biology lessons by nearly 3,000 teachers in the just-ended and upcoming school years. (The project lets teachers watch their lessons—and student reactions to them—to identify effective techniques, like football coaches breaking down game film.) The foundation plans to preview its findings this fall, which could help state Race to the Top winners design teacher evaluation programs.
The study “is very much fast-tracked,” says Gitomer, whose role in the study is to assess teachers. “There’s a feeling this is the opportune time. In a better world, it might have been nice to pilot some of these things. There’s some risk associated with moving that quickly.”
Phillips says the foundation maintains “appropriate firewalls.” While members of its staff testify before Congress and keep tabs on federal and state policy, the foundation doesn’t lobby or influence government decisions on grants, she says. Asked whether the appointment of Brad Jupp, a senior program adviser at the Education Department, to an advisory committee for the Gates teacher videotaping study violated the foundation’s firewalls, Phillips said, “It’s one of those fine lines we walk constantly.” When the foundation approached Jupp, he initially expressed interest in serving on the committee, he said in an e-mail. After Bloomberg Businessweek asked Phillips about it, Jupp declined the position. He said he changed course on the advice of the department’s ethics counsel.
Both Melinda and Bill Gates contest the notion that there is anything amiss in the foundation’s relationship with the federal government. All the foundation wants is results, says Bill Gates, however they are achieved. “If people have particular ideas for improving schools, those experiments will get funded,” he says. Duncan’s spokesman, Peter Cunningham, says the foundation’s agenda “is very much aligned with the Obama Administration agenda. We partner with them on a whole host of things.”
Selling the plan
If Hillsborough district official Anna Brown had been graded on her May presentation to teachers at Tampa’s Chamberlain High School about the Gates plan, she would have gotten an incomplete. One teacher of 12th graders wanted to know if she would be penalized for senior slump. Music instructors questioned the district’s decision to evaluate them on their students’ grasp of music theory instead of instrumental proficiency. Brown got thoroughly grilled about the new system and didn’t have all the answers.
Kathy Jones, a 35-year veteran who teaches Advanced Placement world history, asked how the district could measure her students’ improvement since they don’t take a prerequisite course or a pretest. When Brown said PSAT scores as well as exams in other social studies courses could provide a baseline, Jones scoffed: “I don’t see how it’s even possible.”
The testy atmosphere illustrates the challenges for Hillsborough—and the Gateses—as they translate theory into practice. The foundation has worked hard to bring teachers on board. Gates is paying $1,500 apiece to more than 600 Hillsborough teachers whose lessons are being videotaped. Says Cassie Schroeder, an eighth-grade language arts teacher at Giunta Middle School in Tampa: “I put it toward my credit cards.”
Hillsborough teachers complain that they already have a pay-for-performance plan, and they don’t like it: the State of Florida’s Merit Award Program, which gives 5 percent bonuses based on student test score gains in the prior year. Because of limited funding, teachers within each subject compete for awards. Arlene Castelli, principal of Giunta, says teachers are embarrassed to win the bonuses. “If you can’t boast about an award, what good is it?” she asks. “I don’t like pitting teachers against each other.”
That, in the end, is one of the major worries about the Gates plan: that it will encourage teachers to think narrowly in their own interests, to not only “teach to the test” but also refrain from the cooperative efforts that are essential to the education process. At Giunta, two-thirds of the 1,134 students in sixth through eighth grades are black or Hispanic, almost three-fourths come from poor families, and low achievers in math take two classes, regular and intensive, with different teachers. Before state testing in March, students on the bubble of passing or failing—about 20 percent of each grade—attend extra sessions with teachers who drill them on their weaknesses. Like a baseball player who won’t bunt to advance a teammate, a teacher may think twice about giving a student extra help if a colleague gets the credit—and the pay raise. “We don’t want teacher evaluation to get in the way of student achievement,” says Castelli. “Who’s to say the parents didn’t work with the children at night? Who’s to say the child didn’t mature? Or the child blew off the test the year before?”
Shrugging off “the commune-type approach,” Bill Gates says that excellence demands individual accountability. In his speech to the American Federation of Teachers, Gates struck an evangelical tone as he appealed for faith in his initiative. “You owe it to your profession and your students to make sure that tenure reflects more than the number of years spent in the classroom,” he said. “It should reflect the quality of the work you do in the classroom.”
Later, he added: “Sometimes the most difficult act of leadership is not fighting the enemy; it’s telling your friends it’s time to change.”
http://www.msnbc.msn.com/id/38282806/ns/business-bloomberg_businessweek/
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Billionaire signs on to friend Bill Gates’ challenge to give away fortunes
SEATTLE — Paul Allen has become the latest billionaire to sign on to a challenge by Bill Gates and Warren Buffett to get America’s wealthiest people to donate the bulk of their riches to charity.
In a statement Thursday, Allen, who co-founded Microsoft Corp. with Gates, said he plans to leave the majority of his estate, valued at roughly $13.5 billion, to philanthropy.
Allen, 57, made the pledge on the same day he commemorated the 20th anniversary of the Paul G. Allen Family Foundation, which has handed out more than $400 million in grants and funding for nonprofits in the Pacific Northwest.
Allen, who announced in November he was undergoing treatment for non-Hodgkin’s lymphoma, said he has planned to give away the bulk of his fortune for some time, but had not gone public with his intentions until now.
“Since the beginning, our philanthropy has been focused in the Pacific Northwest, where I live and work. I’m proud to have helped fund great work done by nonprofit groups throughout the region. But there’s always more to do,” Allen said.
“Today I also want to announce that my philanthropic efforts will continue after my lifetime. I’ve planned for many years now that the majority of my estate will be left to philanthropy to continue the work of the Foundation and to fund nonprofit scientific research, like the ground-breaking work being done at the Allen Institute for Brain Science. As our philanthropy continues in the years ahead, we will look for new opportunities to make a difference in the lives of future generations.”
Allen follows in the footsteps of former business partner Gates and billionaire investor Buffett, who last month kicked off a public campaign to get U.S. billionaires to pledge the vast majority of their wealth to philanthropy.
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Allen, the 37th richest person in the world according to Forbes magazine, co-founded Microsoft in 1975 with Gates and resigned as an executive in 1983 as he overcame a first bout with cancer.
He has been involved with philanthropy in the Pacific Northwest for 20 years, largely through his Paul G. Allen Family Foundation.
Allen owns the Seattle Seahawks football team and the Portland Trail Blazers basketball team and is a minority owner of the Seattle Sounders soccer team. He created the Experience Music Project pop museum in Seattle.
In addition to Gates and Buffett — the two richest Americans with a combined net worth of $90 billion, according to Forbes magazine — others who have taken the pledge to commit at least half their fortune to charity include Los Angeles philanthropist Eli Broad, former chairman of insurer SunAmerica Inc. and founder of homebuilder KB Home, joined by his wife, Edythe; Silicon Valley’s John and Tashia Morgridge, whose fortune came from Cisco Systems; venture capitalist John Doerr of Kleiner Perkins and his wife, Ann; media entrepreneur Gerry Lenfest and his wife, Marguerite; and New York City Mayor Michael Bloomberg, founder and majority owner of Bloomberg News parent Bloomberg LP.
The principals behind the campaign have set up a website, givingpledge.org, explaining the effort.
“While the Giving Pledge is specifically focused on billionaires, the idea takes its inspiration from efforts in the past and at present that encourage and recognize givers of all financial means and backgrounds,” the site says. “We are inspired by the example set by millions of Americans who give generously (and often at great personal sacrifice) to make the world a better place.”
http://www.msnbc.msn.com/id/38262228/ns/us_news-giving/
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Billionaire investor plans to eventually give away 99 percent of his wealth
NEW YORK — Warren Buffett has donated another $1.93 billion to five charitable foundations, the third-highest amount since the investor began donating 99 percent of his wealth in 2006.
Buffett donated on Thursday 24.54 million Class B shares of his insurance and investment company Berkshire Hathaway Inc, according to a filing on Friday with the U.S. Securities and Exchange Commission.
The donation grew from $1.51 billion in 2009 because the Class B shares had risen 35 percent in price in the year ended on Thursday, when they closed at $78.81, Reuters data show.
Berkshire has benefited from an improved economy, a quiet year for catastrophe losses in its insurance units, lower paper losses on its derivatives contracts and higher prices for its common stock holdings such as American Express Co and Wells Fargo & Co.
About $1.6 billion of Berkshire shares this year went to the Bill & Melinda Gates Foundation, created by the co-founder of Microsoft Corp and his wife to address education, health and poverty problems.
Other shares went to the Susan Thompson Buffett Foundation, named for Buffett’s late wife, and foundations for their children Howard, Peter and Susan. Buffett remarried in 2006.
The Gates Foundation said it employs 830 people, spent $3 billion last year, and has a $35.2 billion endowment. Buffett expects the foundation to spend his gifts, which have totaled about $8.03 billion.
Following this year’s donations, Buffett still held about $43.9 billion of Berkshire stock, or 23.3 percent of the total outstanding, Friday’s filing shows.
Buffett’s donations totaled $1.93 billion in 2006, $2.13 billion 2007, $2.17 billion in 2008 and $1.51 billion in 2009, according to regulatory filings and Berkshire’s closing stock prices on the dates the donations were made. The size of the 2010 donation is just above the 2006 donation on that basis.
The number of shares that Buffett donates declines by 5 percent each year, after accounting for a 50-for-1 stock split in January.
NEW YORK — Pepsi is expanding its popular Refresh Project charitable program to help communities affected by the oil spill in the Gulf of Mexico
.
The soft drink and snack maker said Thursday it will give an additional $1.3 million in grants next month to projects that will help communities in the five-state region — Texas, Florida, Mississippi, Louisiana and Alabama.
Since January, the Refresh Project has been giving $1.3 million for 32 grants each month. People submit ideas online for everything from literacy projects to programs that provide tuxedos for prom. Then online voters choose winning projects.
The company saw a need for relief in the area and wanted to use the Refresh Project to help, said Lauren Hobart, chief marketing officer of sparkling beverages for Pepsi Beverages America, the unit that runs Pepsi.
“It just seemed like a natural evolution of the program,” she said, adding Pepsi expects to do similar efforts focusing on specific events or locations in the future.
People can start submitting ideas for projects July 12, for anything that helps people in the region. Pepsi said project ideas can’t be related to cleanup efforts or the environment because other agencies are handling that. Possible projects could be providing job training or money for arts efforts in local communities.
“I think we’re going to end up being surprised with what consumers come back with,” Hobart said.
The Refresh Project has been a public-relations coup for Pepsi and has drawn a huge volume of suggested projects and online buzz.
The company has been surprised by the variety of projects — and the number — that people submit each month. The project has given more than $7 million through May this year and expects to spend a total of at least $20 million. So far, more than 31 million votes have been cast.
http://www.msnbc.msn.com/id/38039606/ns/us_news-environment/
SEATTLE — Bill Gates and Warren Buffett
, America’s two richest people, are embarking on a campaign to persuade their super-rich peers to give half their fortunes to charity in a move that could change the face of philanthropy.
The effort, if successful, could funnel a colossal amount of money into nonprofit groups. If the individuals on the Forbes 400 list of richest Americans pledged half their net worth to charity, that would amount to $600 billion, Fortune magazine says.
Fortune, in an article posted Wednesday, detailed the origin and status of the campaign, which it called “the biggest fundraising drive in history.”
Several of the megarich, including Los Angeles philanthropists Eli and Edythe Broad; Silicon Valley’s John and Tashia Morgridge, whose fortune came from Cisco Systems; venture capitalist John Doerr of Kleiner Perkins and his wife, Ann; and media entrepreneur Gerry Lenfest and his wife, Marguerite, have already committed to the 50 percent pledge, according to program organizers. Buffett and Bill and Melinda Gates are sending e-mails and making calls to other billionaires deemed likely prospects to contribute, Fortune reported.
Buffett said it’s a good bet the super-wealthy have already thought about what to do with their money. “They may not have reached a decision about that, but they have for sure thought about it. The pledge that we’re asking them to make will put them to thinking about the whole issue again,” the Berkshire Hathaway chairman told Fortune.
“If they wait until they’re making a final will in their 90s, the chance of their brainpower and willpower being better than they are today is nil.”
First supper
The campaign began just over a year ago, when Gates and Buffett — who represent a combined net worth of $90 billion, according to Forbes — invited several billionaires to a secret dinner meeting in New York. Among those attending were Hungarian-born hedge fund guru George Soros, talk-show host Oprah Winfrey, David Rockefeller, media mogul Ted Turner and New York City Mayor Michael Bloomberg.
$50,000 bought a table next to him at fundraiser to help Lesotho
NEW YORK — Britain’s Prince Harry capped his New York visit with a polo match Sunday on an island off Manhattan to benefit 400,000 children of an AIDS-ravaged African nation.
The 25-year-old son of the late Princess Diana was pitted against the best-known player in the equestrian sport, the Argentine Nacho Figueras.
Harry took a tumble from his horse, but it was all for a good cause, and he had a smile on his face as he got back up and continued the contest.
Figueras won 6-5 in overtime.
The 3rd Annual Veuve Clicquot Polo Classic was played on Governor’s Island. Harry has participated the past two years.
The United States “has always protected the downtrodden, the poorest, those most in need of help in the world,” Harry said before the match. “And to me, this is what the United States stands for.”
Harry mounted a polo pony as part of his pledge to continue his mother’s work. Princess Diana, who was often photographed embracing HIV-positive mothers and children, died in 1997 in a Paris car crash.
Sunday’s heat, topping 90 degrees Fahrenheit (32 Celsius), “is a welcome relief after the snow and ice of Lesotho, where I was last week,” her son said of the southern African nation where he said he took his brother, Prince William, to show him the work of his charity.
Earlier, Harry joined guests in the VIP “marquee” — a fancy white tent where lunch tables for 10 overlooking the field went for as much as $50,000.
Proceeds from the day would go to American Friends of Sentebale, a charity set up in 2006 by Harry and Prince Seeiso of Lesotho for “the vulnerable children of Lesotho,” where many children are AIDS orphans.
Harry said both he and the African prince wanted to follow the examples set by their mothers.
“Both were very much loved, and both loved people — both loved helping people who needed it the most,” he said.
About 100 children in Lesotho lose one or both of their parents each day, Harry said, adding that the orphaned children survive with no prospects of a regular nourishing diet and little hope of a meaningful education.
The tally for the day was not immediately available, but was likely hefty, given the minimum price for a table for 10 in the VIP marquee — $20,000. The $50,000 tables were closest to that of the prince. A picnic on the grass went for $250 per person.
There was a time when luxurious leisure was not the order of the day on Governor’s Island — 172 acres about a half mile from the southern tip of Manhattan Island. It was occupied by the U.S. Coast Guard until 1996, and is now managed by the National Park Service.
Harry’s three-day visit to New York began Friday at the West Point Military Academy north of the city, followed by UNICEF on Saturday, when he threw the first pitch at a Mets game.
Economy down, volunteering up
Number of people getting involved grew during recession
WASHINGTON – Volunteering in America is on the rise.
Americans spent 100 million more hours helping their communities last year, a new federal report says, and the number of people getting involved went up by 1.6 million to 63.4 million.
It’s the biggest increase in volunteers in a single year since 2003, and it came in the midst of a punishing recession, according to a report released Tuesday by the government-run Corporation for National and Community Service. The agency oversees national service programs including AmeriCorps.
The rise in volunteers comes as the nation struggles to regain its economic footing amid high unemployment.
The report points to lower volunteer rates in states with high rates of unemployment and in cities with high rates of foreclosures.
Patrick Corvington, who leads the government’s national service agency, said people in these affected areas are still helping a neighbor in need or cleaning up a nearby park. He said the report reflects those serving through more formal organizations and nonprofits, and doesn’t capture those giving in other ways.
Women largely contributed to the jump in volunteers. In 2009, 36.7 million women volunteered, up 1.2 million from 2008. More blacks also gave their time.
Americans overall set aside 8.1 billion hours to lend a hand, with the typical volunteer donating about 52 hours for the year.
Raising money or selling items was the top volunteer activity, followed by collecting and distributing food. Others spent time providing transportation or labor, and tutoring or teaching.
People primarily served through religious organizations or social and community groups.
Fundraiser puts Gulf seafood on menu
BERKELEY, Calif. – Eat a shrimp, support a Gulf of Mexico fisherman. That’s the thinking behind the “Dine Out for the Gulf Coast” campaign in which restaurants across the country will be putting a little fish philanthropy on the menu.
During the event, scheduled for June 10-12, participating restaurants will be donating to the Gulf Coast Oil Spill Fund. Restaurants that are able to, also will feature seafood from the Gulf.
“It’s good that we establish a conversation on the meaning of something like this,” says chef and restaurateur Jose Andres, who is participating in the event at all his restaurants, including The Bazaar in Los Angeles and Jaleo in Washington.
