Generous donations to a non-profit can often become more of a burden than a blessing which is why it is important to have a good donation policy and properly evaluate the impact of the donation upon the organization.
According to a story in Non Profit Quarterly, this is exactly the challenge being faced by the Great American Songbook Foundation in Carmel, IN. The organization with a budget of less than $1 million was approached with a non-strings attached donation of an estate valued at $30 million.
….includes a couple of golf courses, a pool, a fully furnished 50,000-square-foot main house, and a clubhouse—all set on 107 acres. There are no conditions on the contribution.
The upkeep alone could easily eat up the entire current budget of the organization, what with the nine staff required to maintain the property, and it should be pretty darn clear to any manager or board who have taken a trip or two around the block that such a gift could potentially ruin the organization.
This isn’t the first time the Simons have tried to move the property, which has covenants that disallow certain kinds of development. In fact, the property has been on the market since 2014 at $25 million with no takers. Additionally, a previous attempt to contribute the property to the Indiana University Foundation in 2008 fell through.
The Songbook Foundation Board is going to take three years to study the use of the estate which is probably a wise course of action. The NPQ article notes that since they accepted the donation of the estate, they will bear the costs associated with maintaining the estate during that time.
There are a number of options available to the Songbook Foundation according to another article.
The foundation could decide to use the main house as a museum and center of operations, subject to a rezone. The golf course land could be sold in a plan similar to Estridge’s but with lot sizes that meet the covenants. That money could be used to support operation of the museum.
The entire property, including the main house, could be sold to a developer. That money could be used to support the foundation or build the Great American Songbook Museum closer to The Palladium, possibly next to the soon-to-be-built luxury hotel, The Carmichael.
“It’s a very generous gift,” Brainard said. “It’s an asset that could be used by the Foundation to leverage for future donations. It’s very important to include neighbors in any conversation about any use and then proceed in such a way that enhance’s property values in the area.”
…He [McDermott] said charity events could be held on the golf course and added that a donation this size is a signal to other potential donors who were thinking of writing a check.
I have to admit, given the number of fundraisers that occur on golf courses, I was amused by the thought that these guys may be the only non-profit to own part of their “supply chain.”
If they decide to keep the properties, they will almost definitely need to set up a separate administrative body to keep themselves from getting bogged down in the business of overseeing the estates. Not to mention there might be issues that conflict with their non-profit status. The unrelated business incomes from the estates could potentially be 25+ times greater than that of the non-profit. It will be really interesting to see what they decide to do.
I made a post on the ArtsHacker site about two years ago that included lists and links to various resources one can use to create a gift acceptance policy and to evaluate the suitability of accepting gifts when donors approach the organization.
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