In particular, Schmitz says the following:

By virtue of their low pay, long hours, and high-intensity nature, campaigns are always filled with young people. But the Obama campaign recognized and empowered young leadership…The campaign’s all-hands-on-deck approach meant that the top fundraisers and policy advisors – whether they were Goldman Sachs partners, Hollywood stars, or law professors – were expected to canvass door to door and be managed by 22-year-olds. They did so, reporting for duty enthusiastically and building respectful and supportive relationships with these young field organizers rather than questioning them or taking over.

Ah! Talk about music to the young, nonprofit professional’s ears! The biggest problem that I’ve found so far in New Jersey’s nonprofit sector is the entrenchment – for better or for worse – of aging leaders. I cannot stress enough the phrase “for better or for worse” in this statement, though. There are people like Msgr. William Linder in Newark who should be involved in community development at all costs and at all times! This man is a saint for the work that he’s done to bring much needed services to the underserved communities of Newark. The same is true of so many dedicated, older professionals in the state’s nonprofit sector.

However, in my work I find many organizations that have a tremendous glut of young talent who are suppressed under an old style of management. What’s more concerning is that in New Jersey you rarely find high-level executive positions in the nonprofit field being filled by the under 35-year-old crowd. And that’s a shame because it pushes talented folks out of the nonprofit arena and into the private sector. You do see younger folks being named Executive Vice Presidents and Directors of this or that program, but that’s generally in young organizations with less than five employees and they are usually organizations that aren’t too substantial.

What I’ve seen in my own experiences are the elevation of inept individuals with little-to-no leadership skills. Actually – let’s just say that there are NO leadership skills! Anyway, reading Schmitz’s article was nice because it reminded me of how things are supposed to be.

The latest in this miniseries talks about how the colleges themselves are losing their actual monetary value in this market. In other words, college endowments are taking a hit. The New York Times put this article up two weeks ago and it’s an interesting read which I recommend if you get a chance. This struck me from the article:

They found that while endowments gained in value by about 0.5 percent in the old fiscal year, they lost nearly a quarter of their worth in the subsequent five months, a period in which the financial markets sank.

“It’s a rolling contagion that hit us,” Mr. Griswold said.

The pain was spread among institutions large and small, private and public. When endowments were categorized by size, even the least affected — those worth more than $1 billion — were found to have lost an average of 20 percent. Those of $500 million to $1 billion saw the biggest decline, about 25 percent. Public institutions lost an average of 24 percent, private institutions 22 percent.

I have two thoughts about this blurb. First, that’s horrible for the universities and colleges. Losses of that magnitude create real problems for nonprofits and I expect that we’ll see the biggest impact of these declines in September 2009 unless the economy roars back and some of this lost value returns.

Second, for some of the richer colleges I can’t help but think that they got what was coming to them. Come on – you can’t sit on $1 billion (or more) dollars and only offer the most piddling of scholarships and merit awards to your students who really need it. That’s not right. On the same point, I do feel somewhat bad for the major ivy league schools like Harvard who have now all but eliminated undergraduate tuition due to the recent backlash against colleges hording money instead of spending it on their students.

I went to Monmouth University and various places on the internet report that they have an endowment between $41.6 million and $50 million. I’m going to assume that they were at $50 million. If they took the same 25% hit that the Times article is talking about, then they’re down at $37.5 million. Online sources also report an annual tuition of about $35,000 (which has been rounded up from $33,464 to include the cost of books and other random fees). Wikipedia suggests that there are 4,744 undergraduates at Monmouth University right now.

What’s amazing to me is that if you do the math, Monmouth makes some $158.7 million in tuition and fees each year. Wow! For an institution that has been around since 1933, you’d think that they’d be able to raise more than $50 million in their endowment at this point. What is going on/wrong at Monmouth University that their endowment is so small, you ask? Look at the damn tuition!

It seems somewhat interesting to me that the tuition is so high for this school and that the endowment is so low. You would think that those who can afford to go to such a school (by straight payments or student loans like me) would be able to donate back to the school. Is there something going on at Monmouth that is prohibiting its alumni from wanting to donate? Speaking from experience I can tell you that after racking up such a gigantic debt attending the school, I haven’t donated back to it. I have donated back to Rutgers University, though, since they rewarded my good grades with essentially free tuition in my graduate program.

Monmouth might have to revisit its policy towards rewarding those students who are performing well in their classes. Their endowment might depend on it.

It costs more to acquire new donors than to retain them, experts say. But churning through donors also makes it harder to woo benefactors. “Donors don’t want to be funding fundraising,” says Sargeant. “They want to be funding the work you’re trying to do.”

And they’re demanding much more accountability from the nonprofits they bankroll. If they don’t get it, they walk, says Penelope Burk, president of the fundraising consultancy Cygnus and Associates.

This is it – this is what the nonprofit industry comes down to. First, are you asking for someone to make a donation that goes to a cause or goes towards paying for salaries? Second, are you willing to explain your expenses and why money is put in certain places as opposed to others? Third, are you doing what you actually said you would be doing?

The answers to these three questions are why I donate to the Sigma Pi Educational Foundation. When I donate to the SPEF, I am giving a tax-deductible donation to two specific funds (both of my choosing) that are managed by people I know on a first-name basis and can e-mail at 1:00pm and receive a personal response by 2:00pm. These funds are under the oversight of a Board where I know many of the members on a first-name basis and have many of the cell phone numbers in my phone.

That level of trust is hard to come by in the nonprofit sector.

I helped put these two funds together and I know where each dollar is spent. I know how much of the fund’s earnings are spent on administrative expenses and I know how much goes back to the overall end-user and it what forms (scholarships for the undergraduate fraternity brothers). At any time I can pick up the phone and call the President of the SPEF and have a discussion with him.

There’s a level of trust and reliability there that you cannot build very easily. Hell, my own company is a nonprofit and I’ve yet to donate or invest any money with them! I’ll be changing that in the New Year, but it has taken me the better part of 16 months as an employee to even reach that level of comfort.

So be sure that you know the places that you’re donating to and be sure that you know where the money is being spent. And hey, if you feel like you can’t make an impact with any organization, then donate to the Sigma Pi Educational Foundation! It’s a good group with a good cause which I’d be more than happy to talk to any of you about!