The NonProfit Times - June 1, 2008 - (Page 1)

The Leading Business Publication For Nonprofit Management • www.nptimes.com • $6.00 U.S. June 1, 2008 First Kroc Center Set To Open $1.7-billion bequest funds new centers around the country BY MARK HRYWNA he first Ray and Joan Kroc Corps Community Center constructed with funding from Joan Kroc’s $1.7-billion bequest will be dedicated June 27 in San Francisco.The opening will mark the first of 30 scheduled to open during the next five years by The Salvation Army.The next one to be dedicated is slated to be Sept. 14 in Atlanta. Hospices Put On Life Support Fundraising becoming more important as federal cuts loom BY MICHELE DONOHUE ospices care for people at their most vulnerable time, but now those services are at risk as 3,000 Medicare-licensed hospices face slashed reimbursements in President Bush’s 2009 budget proposal. T H The widow of McDonald’s founder Ray Kroc, Joan Kroc left the bulk of her estate to The Salvation Army after she died in October 2003. The $1.5-billion bequest, which turned out to be more like $1.7 billion after the estate was settled, was not to go for current programming. Instead, the gift was earmarked to build Ray and Joan Kroc Corps Community Centers, like the one opened in San Diego in 2002, and to provide endowments to operate the facilities equal to construction funding. That stipulation was enough to have Workers prepare to raise the steeple on the Southwest Atlanta some question whether such a “mega-gift” Ray and Joan Kroc Corps Community Center, scheduled to open in the fall. could -- or should -- even be accepted. Other centers are in various stages of planning and construction Some Army chapters have had to overcome donor perception that the organization doesn’t need their contributions given that they with nine more expected to open next year, another 12 in 2010 received a huge bequest,potentially jeopardizing existing program- and four in 2011. Five centers are still undetermined, although one ming.The first Kroc Center, built in San Diego with the help of a of those hopes to break ground this year. The cost of centers ranges from $16 million to $160 million, the most expensive camdonation from Joan Kroc in 1997, made clear the importance of an paign being in Chicago. endowment match. Kroc added $5 million after her original $87The Kroc Center in San Francisco sits on a half-acre of land and million donation proved insufficient to complete the project -- but is about 75,000 square feet, with an additional 60,000 square feet the endowment was never added to -- and the center opened to of transitional housing connected. Construction totaled about $56 problems in 2002. million, with $30 million for the Kroc Center, and another $32 milThe Atlanta and San Francisco centers are further ahead of othlion for the center’s endowment. The largest center, in Chicago, ers because they had already started campaigns when Kroc’s gift, the largest single gift to any one charity, was announced in 2004. Kroc Center, page 10 “If these cuts do happen, we’re going to have to look at the community. We don’t want patient care to suffer,” said Patricia Morgan, Hospice Southeastern Connecticut’s community development director, based in Norwich, Conn. The budget proposal seeks to eliminate the hospice market basket for three years and reduce the update in the following two years by 0.65 percent, affecting the Medicare Hospice benefit reimbursement by more than $5 billion in five years. Another rule that would change, which does not require Congressional approval, is the technical way market basket rates are read, additionally impacting reimbursement by more than $2 billion.The regulations would also increase the time between on-site surveys, from its current six to eight years to 10 to 12 years. Hospice reimbursement cuts would hinder quality end-of-life care that saves the Medicare system more than $2,300 per patient in the last year of life, according to a Duke University study published in Social Science & Medicine, and come when hospices expect more patients as the Baby Boomers age. Hospices, page 31 It’s Layoffs And A Lawsuit At ARC In The Twin Cities BY MICHELE DONOHUE he American Red Cross (ARC) can plan for natural disasters, but the newly merged Twin Cities chapter in Minneapolis, Minn., wasn’t prepared for two waves of layoffs, an age and sexual discrimination lawsuit and a crippling financial market -- all during the past two years. T Confronted with a $2-million deficit, the Twin Cities ARC announced 11 employee layoffs for the chapter that serves more than 130 cities and 2.5 million people in Minnesota. The layoffs come as the chapter organized its $10 million fiscal year 2009 budget and goals, according to chapter CEO Jan McDaniel. Another four open job positions will not be filled in addition to the 11 layoffs, reducing staff size to 80 employees.The chapter cut 24 employees last year. “Unfortunately, when it came to lower donations and lower earned revenue, and look- ing into 2009 and saying we have to be conservatively aggressive, it was really about personnel costs at that point,” said McDaniel. She said that the chapter saved some money by streamlining business operations and outsourcing professional services when the St. Paul and Minneapolis chapters merged in 2006. The chapter has been using a financial reserve to cover the deficit and using interest income to pay salaries. But the investments are declining with the stock market slump, leaving the organization with a smaller financial base. Unrestricted individual contributions declined from nearly $2.2 million in 2006 to $1.3 million in 2007. Restricted individual contributions soared, from $32,016 in 2006 to $238,899 in 2007. Corporate and foundation funding increased more than $300,000 in that year, but Twin Cities, page 8 ADVERTISEMENT THIS FRONT PAGE NEWS IS FOR YOU The first custom Visa program for smaller organizations has a $100 donation waiting for your group. Call 1-866-747-7488 or visit www.cardpartner.com. http://www.nptimes.com http://www.cardpartner.com http://www.cardpartner.com

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The NonProfit Times - June 1, 2008 First Kroc Center Set To Open It’s Layoffs And A Lawsuit At ARC In The Twin Cities Hospices Put On Life Support Contents Who...When...Where...How...What? Idol Charities Still Waiting For Funds Heck Of A Job Play On Words Make Endowments Pay Donor Management Software Who’s Next? Joining The Masses Online Email Evangelism Three Corners Business Briefs Fiduciaries And The 990 Calendar United Way Refocusing On Programs, Reducing Affiliates NPT Jobs Resource Directory

The NonProfit Times - June 1, 2008

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