Australia’s Last Poet Laureate Was A Convict?

Big news out of Australia where the first national arts policy since 2013 was announced.  In addition to commitments of funding to specific entities and organizations, arguably the most significant element of the policy is a commitment  “….to protect First Nations knowledge and cultural expressions, with a particular brief on cracking down on fake art that plagues the $250m-a-year Australian Indigenous art market.”

Other elements of the plan include the establishment of a poet laureate position which last existed during the country’s convict era,  a state of the arts report to be issued every three years, and the establishment of  “a quota for expenditure on Australian content by multinational streaming platforms such as Netflix and Stan..” The amount of this quota is rumored to be about 20% and The Guardian article quotes people who are concerned streaming platforms may pull out of the country if they are required to produce Australia based content.

It happens that I saw a piece on Vice last night before I saw The Guardian article. Vice asked Australian artists what they thought about the plan.  Many felt the money was going to the usual suspects and advocated for a universal basic income plan for artists.

Others felt that the arts were unfunded in proportion to their footprint:

“The arts sector will get $286M over four years, or $72M a year. The fossil fuel industry gets $11.6B a year in government subsidies. Australia’s arts sector employs about six times as many people as the fossil fuel sector.

The requirement for locally generated content was cause for hope for some:

“I started to lose hope in local content knowing that reality TV filled up much of our “Australian” quota on broadcast networks. The possibility of streaming services now being made to spend 20% of their budget on original, local content honestly makes me feel hopeful and excited to pursue my career on my home turf.”

A Look At Who’s Managing Foundation Funds

For the third year in a row, the Knight Foundation has conducted a survey of the top 55 charitable foundations with the intent of measuring the diversity of those managing the assets. Of the 50 eligible to be measured, (five do not have funds under active management or engage in other approaches which don’t meet study criteria), 15 declined to provide a response to the survey.

Knight Foundation was disappointed in the lack of transparency. I had written about the problem of donor advised funds essentially sequestering charitable gifts with no obligation to to distribute them. Some of those on Knight Foundation’s list of non-responders are set up in this or similar arrangement.

Knight Foundation had examined their own practices about 12 years ago and appalled by what they found, set out to diversify the companies that handled their investments.  Reading the report, you may be disappointed to learn that 81.9% of the top 50 charitable foundations funds are invested with firms primarily owned by white men. However, at 18.1% charitable foundations are veritable role models in the investment world at large where the industry average is 1.4% invested with diverse owned firms.

Knight Foundation isn’t simply pursuing this policy to provide a fairer distribution of assets under management to diverse owned firms. They have seen that diverse owned firms engage in more diverse investment strategies avoiding “group think” approaches which may result in unhealthy concentrations of assets in problematic companies and industries, but this investment approach by diverse owned firms is no more risky than non-diverse owned ones.

That study, and the two in the series that proceeded it, found no statistically significant difference in risk- adjusted returns between diverse-owned and non-diverse-owned asset management firms. Put another way, despite no performance advantage, firms primarily owned by white men manage 98.6% of the over $80 trillion under management in the United States. And that $80 trillion represents more than three times the entire GDP of the United States.

 

IRS 990 Backlog Hampering Non-Profit Giving and Transparency

ProPublica recently reported that the IRS has yet to release nearly a half million non-profit tax records. You may be wondering why that is something you should be concerned about. In fact, the lack of records release has some pretty significant implications for transparency and charitable giving. Drew McManus has been painstakingly combing through records since 2005 to assemble his annual Orchestra Compensation Reports.  I believe among the reasons why he didn’t have a 2022 edition examining the impact of the pandemic during the 2019-2020 fiscal year was partially due to the lack of 990 filings available for review.

Additionally, many individuals, corporations and foundations use the filing data to make giving decisions.

“This is having an impact on nonprofits, fundraising, donors … and charity regulators,” said Cinthia Schuman Ottinger of the Aspen Institute, who coordinates a group of practitioners who work with nonprofit tax data (ProPublica is a part of this group). “The whole ecosystem suffers when there are delays of this kind.”

Michael Thatcher, the CEO of Charity Navigator, said the end of the year is a crucial time for charitable giving.

[…]

And, he said, “it’s not just the donors that are upset by this.” Many organizations want their latest information out there as well, especially if their finances have improved or they’ve done significant work in recent years. “They want to show that to the world, and guess what, when you go to Charity Navigator, you’re seeing two-year-old information.”

Many of the missing filings could help shed light on how organizations — and the nonprofit sector as a whole — have fared during tumultuous years marked by a pandemic, economic upheaval and large infusions of federal relief dollars.

Courtney Aladro, a charity regulator for the Massachusetts attorney general and NASCO board member, said that regulators across the country use the IRS repository of documents to confirm or corroborate the information that charities submit to their states….

“Those are some pretty important years because of some of the difficulties over the last few years,” Aladro said. “The use and expenditure of COVID relief funds, for example. It’s pretty important for charity regulators and law enforcement to monitor that, and not having that information will make it more difficult.”

The IRS has been hampered by underfunding and understaffing which has lead to both delays in release and embarrassing release of tax information that was not supposed to be released. A recent bill passed by Congress will seek to modernize systems and hire more staffing, but it could be years before the problems are ironed out.

Comp Tickets Are Not Cost Free Transaction

Last month Drew McManus had box office manager Tiffin Feltner make a guest post on his Adaptistration blog on the topic of comp tickets.   It has taken me about three weeks to stop grinding my teeth long enough to make a post of my own on the topic.  You will see a lot of posts about optimizing ticket prices based on various criteria and I think those assume people have a handle on their comp ticket policies. But let me tell you, in my experience there are a lot of people out there you think would know better who have absolutely bonkers approaches to comp ticketing.

Feltner notes that about 40% of comps go unused. I wondered if that is a nationwide statistic or just what they have observed in terms of the venues they serve. Reports I have pulled from my ticketing system often show much greater rates than that.

Organizations I have worked at have ticketed events for rentals of our own venue as well as served as a community ticketing hub providing service to other organizations at their venues. Many times they are not only comping tickets for individual events, but providing comp subscriptions which results in a large number of empty seats for the entire year.

There are so many issues that arise because of comp ticketing decisions. First, because organizations like to comp tickets and subscriptions to important guests, they place them in large, consecutive groups in the closest rows. Which means if people don’t use the comps, you can have a nearly sold out event where the first 10 rows are virtually empty and those in attendance are packed like sardines in the back of the venue.

Then there are other cases when the event is sold out in the ticketing system and the client can’t get a special last minute guest in because they distributed the house seats held back for this purpose days earlier. Then of course, when the show starts there are a bunch of empty seats because so much of the house had been comped.

We have run into situations where the client decides a ticket holder has forfeited their seat by not showing up five minutes before, without ever having communicated that policy. (Because it didn’t exist until just now.) Sometimes the ticket holder shows up to find their seat occupied, sometimes that bullet is dodged.

Then there have been times the client tells us they have confirmed a ticket holder is not attending, asked us to assign the ticket to someone else, and then put a sign on the seat reserving it for a third person.

Not only are poorly considered ticketing policies bad optics and create poor customer relations, most of the time the ticketing staff ends up as the target of blame for these bad decisions–often by the people responsible for making these bad decisions. This is what makes me grind my teeth because all these bad feelings and awkward situations could be avoided with a little forethought and policy discipline.

In their guest post, Feltner suggests using a card that can only be redeemed on the night of the show as a solution to the comp issue. That is similar to an approach my staff has used with clients where we suggest unassigned blocks of seats strategically placed in places with good sightlines. These blocks can be assigned as needed when it is known what VIPs will be attending. This allows for better placement and assignment of seats prior to an event date.

However, there needs to be strong comp policy guidelines in place so that there isn’t a gradual creep back to 1/3 of the seats being comped well in advance.  If your venue scans tickets, you are probably able to pull a no-show report broken down by ticket category that can provide insight into how many of the comps are being used which can inform tweaks to the ticketing policy.

While I am advocating for a robust comp ticket policy, this is not to say that you shouldn’t be offering comp tickets. There are a lot of reasons why free admission is a bad idea, but it can be useful to achieve targeted goals. As Feltner mentions, it is important to have some sort of tracking mechanism in place to evaluate whether you are achieving those goals.

One thing to consider if you are offering comp tickets as a sponsorship or donor benefit is to ask the recipient if they plan to use the tickets. In my experience, a fair number of people provide support because they believe in the organization’s work, but don’t necessarily intend to redeem the benefits that come with the support.

Not only does that allow those seats to be filled, but it also allows a greater portion of their donation to be credited as tax deductible because they are not receiving material benefit. However, this benefit needs to be refused immediately at the time of the donation. You can’t ask people in December after you have had 8 events occur and then retroactively provide credit for unattended shows. If they do decide to attend one event at a later time, you can always comp them in then and make an appropriate adjustment to their donation credit.