Schaefer charity shows how not to run a nonprofit
The Don Schaefer Foundation is only getting started, but it's already giving several lessons in how not to run a nonprofit organization, as Laura Vozzella chronicles in the newspaper.
1. Structure.You can't run a nonprofit of any size with only three board members. This is basically money that Schaefer has given to the public. Multiple board members are needed to watch over each other and to make sure the donor's wishes are fulfilled. Now two of the Schaefer Foundation's trustees are trying to kick out a third. From the Maryland Association of Nonprofit Organization's Standards for Excellence:
The board should have no fewer than five (5) unrelated directors. Seven (7) or more directors are preferable.
2. Conflicts of interest. Nonprofit governance experts frown on trustees steering business from the nonprofit to themselves. According to Vozzella, trustee Zelig Robinson is also the foundation's legal counsel. He's the client and the vendor simultaneously. He declined to tell Vozzella if he's working for free.
From MANO's Standards for Excellence:
A nonprofit should have policies in place, and should routinely and systematically implement those policies, to prevent actual, potential, or perceived conflicts of interest.
3. Openness. Nonprofits need to tell the public what they're doing. Their money doesn't belong to the trustees. The public has a special interest in this case because it's the legacy of a beloved public servant. Yet when Vozzella tries to find out what's going on, Robinson starts talking about attorney-client privilege.
From the MANO standards:
Nonprofits are private corporations that operate for public purposes with public support. As such, they should provide the public with information about their mission, program activities, and finances. A nonprofit should also be accessible and responsive to members of the public who express interest in the affairs of the organization.