Give A Kid A Culture Voucher And They Buy Books As Well As Experiences

I have been keeping an eye on the cultural voucher programs various European countries employ to encourage young people to get out and engage in different experiences. The program differ in detail. There are some that provide rail passes to allow people to explore different geographic areas, including outside their own countries. Others are focused on arts and cultural experiences within the country.  I have written about Germany’s KulturPass before, but I recently caught a story about the most recent round of the program.

According to a recent article, as of August 9, in terms of units purchased since this year’s KulturPass program began on June 14, books and other printed materials have lead the way by far.  Then cinema tickets, concerts and theater, museums and parks, musical instruments, audio media and then sheet music.  In all, about 200,000 units have been purchased in the last two months. About 136,000 German 18 year olds have activated the passes worth €200 (US$219)

In terms of amount spent, concerts and theater lead the way given the greater cost. “….at something around or above €12 million (US$13.2); books follow with so €11 million (US$12.7 million); and cinema tickets follow in third place with €461,000 or more (US$505,900).”

Lest you think Germans are particularly bookish with 49% of voucher funds being used to purchase tomes, Italy has seen similar results with their pass.

“…Italy’s corresponding “18App”—the original “culture voucher” for young citizens in Europe. There, in 2021 specifically, the publishers association reported that 18-year-old Italians were spending 80 percent of their €500 vouchers on books during January and February of that year.”

Obviously, there may be differences in the design and implementation of the pass in Italy that encouraged larger purchases of books. The fact these numbers come from a period 10 months into the Covid pandemic when there were reduced opportunities for other activities likely influences the numbers as well. However, these programs are good examples of a tool to provide bottom up funding to provide a little stimulation to arts and culture organizations.

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.