The Desktop Guide is Quickly Becoming the Must Have Guide for Nonprofit Executives Jack Siegel's book, A Desktop Guide for Nonprofit Directors, Officers, and Advisors: Avoiding Trouble While Doing Good, has quickly become the go-to guide for nonprofit executives and advisors. So what are people saying about the Guide? In the October 2007 edition of the The Federal Lawyer, New York lawyer George W. Gowen and nonprofit authority, wrote:
Some of our readers have followed the link to the Amazon.com Web site, but apparently have not bought the Guide. If they were turned off by the price, they should reconsider. One prominent attorney in the exempt organization field grabbed a review copy of the Guide and couldn't put it down. She has instructed a number of her clients to buy it, pointing out to them that for less than 1/2 hour of her billable time, they receive a lesson (and resource) that tells it like she would like it told. If you are starting a new charity, the Guide could save you thousands of dollars in legal fees by teaching you how to better utilize your legal counsel and framing the issues so you don't spin your wheels at $400 an hour. |
little to suggest that the sole trustee, Harvey S. Shipley Miller, has done anything wrong.
The foundation’s patron, Judith Rothschild, died in 1993, leaving what appears to be a valuable collection of art (Matisse and Mondrian are mentioned in the article) to a foundation created under Ms. Rothschild’s will. Mr. Miller, who was a friend of Ms. Rothschild’s, was appointed the sole trustee. The foundation’s mission was to use its collection of art to promote underappreciated artists. Ms. Rothschild apparently viewed herself as a member of that class.
The second paragraph of the article notes that Mr. Miller “has since donated or sold many of these artworks and used the proceeds to benefit cultural institutions across the country.” OK, so what’s the problem?
You have to keep reading. In paragraph three, we learn that as the sole trustee, Mr. Miller was paid somewhere around $200,000 a year and lived in the foundation’s Park Avenue town house, where the collection of art was kept. While $200,000 a year is a lot of money in many parts of the United States, in New York City it is not. Many New York City public sector employees make close to $100,000 a year. While living on Park Avenue is a nice perk, the decision may have made perfect sense if there was spare space and Miller's presence reduced security costs. Lots of college presidents and ministers live rent-free in facilities provided by their employers. And we can’t help note the irony: A second Times article marks the 20th anniversary of the Isabella Stewart Gardner Museum heist.
We checked out the foundation's 2008 Form 990-PF for the foundation. It is pretty clear that this is a functioning foundation. It has a full-time employee who administers the grant program. It devotes 6 pages of the return to describing its grants and activities. Lots of institutions and grants are listed. No doubt making grants of this nature is hardly drudgery, but there is every reason to believe that Mr. Miller and the other employee do work. Although the foundation may be a nonprofit entity, that doesn’t mean the employees are nonprofits. They are entitled to compensation for their work.
Don’t get us wrong.
We don’t think a one-member oversight board represents best
practices. However, blame
Rothschild, who put the structure in place. She could have appointed more than one trustee, but she
didn’t. So long as the law permits
one trustee or board member, no one should object if donors take advantage of
the what they must perceive as the benefits that come with just overseer. Interestingly, the article doesn't address whether Miller acted as Rothschild's lawyer in providing for the foundation.
In fairness to Flynn and Pogrebin, they point out that Miller has not been accused of any misconduct. Moreover, they note that he has impressed many. Miller asserts that he has “labored faithfully to serve Ms. Rothschild’s interests.” The article notes that Miller has arranged for the exhibition of Ms. Rothschild’s own paintings. He also assembled a collection of 2,600 drawings, many by relatively unknown artists, which was donated to the Museum of Modern Art.
The article details several actions on Mr. Miller’s part that might be open to question. A curator position at the Museum of Modern Art was named after Mr. Miller. The foundation also made gifts to UCLA, which created a fellowship named after Mr. Miller. While it might have been more modest to name the position and fellowship after Ms. Rothschild, the institutions may have wanted to acknowledge the work and insight that Mr. Miller brought to the activities.
The article also devotes space to a discussion of the prestigious board positions that Mr. Miller has been appointed to. The suggestion is that these institutions are courting Mr. Miller and his power to make grants. Once again, we don’t fault Mr. Miller. Someone in his position should want a broad, but inside view of what is happening in the art world. The fact that other people covet these positions is not Mr. Miller’s problem. We covet the position held by the chairman of Goldman Sachs. That doesn’t make the chairman a bad guy. If anyone should be faulted, it is the institutions’ who appointed Mr. Miller to their boards. If they did so because of their desire for gifts, they have failed to recognize the legal role of boards.
The article points out that the New York State Attorney General is conducting a review of Mr. Miller’s stewardship. At the end of the day, we are willing to be that the charity bureau will have some criticisms and the New York Attorney General may require a special annual report to be filed, but that Mr. Miller will not be accused of any wrongdoing.
We aren't even sure that this situation is as unusual as the article suggests. The late Louis Auchincloss made a career out of documenting New York society, particularly the world of white shoe law firms. We would bet that there are more than a few large estate's being administered by these firms that have been open for years and that make charitable bequests for deceased clients who left no issue. We suspect that these firms are charging considerably more in fees than Mr. Miller has been paid. The difference is that the estate's have not been formalized as foundations.
We are big fans of Pogrebin (we are less familiar with Flynn), but in this article, we see a lot of smoke, but no fire. In short, we don't see a clear purpose for the article. Is this a story of scandal, a human interest story, a character study, a warning to other wealthy people, or something else? We certainly don’t understand why it warranted front-page attention, although it was the first article we read so maybe it sold some papers on the newsstand.
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