East Side Youth Center

Nonprofit Management4e

Michael J. Worth

Instructor Resource

Nonprofit Management

Case Exercise for Chapters 4 or 13

Case: EAST SIDE YOUTH CENTERBOARD:giving and Fundrasing

The East SideYouthCenter is a community-based nonprofit that provides after-school recreational and cultural programs and tutoring to young people in an urban environment. Its staff includes an executive director, a business manager, and an executive assistant. Its programs are managedprimarily by volunteer leaders. Its budget is about $500,000. About $250,000 comes from three events and the balance comes from gifts made by individuals, local businesses, and two local foundations.

The Center’s board of directors includes 15 people. In the past, the board consisted almost entirely of friends of the founding executive director, parents of students who had been served by the Center, and individuals who also worked as volunteers in the Center’s programs. As financial pressures increased in recent years, an effort was made to recruit more business people and about half of the board members now are from business or are professionals. The other half is still parents and volunteers; some of the volunteers are affluent people, but some are young people without financial resources.

At a recent meeting the board’s chair raised the question of the board’s giving. Less than half of the board members made any personal gift last year. One gave $10,000 and a few others gave at the $1,000 or $500 levels. Others just made token gifts far less than they could afford. A few board members also were instrumental in obtaining gifts from their companies or local foundations. Some helped with planning for the three fundraising events. Some did nothing.

The chair said to the board, “If we are going to raise the money we need, the board will have to lead the way and set an example. We need a policy that makes the expectations for board giving and participation in fund-raising explicit.” A consultant was retained and spoke to the board at its next meeting. She presented the following options for the board’s consideration:

1)Encourage board members to give, but don’t make it a requirement.

2)Require that every board member make some gift but do not specify the amount.

3)Establish a specific minimum annual gift that every board member is required to make.

4)Establish a requirement that every board member should make an annual gift equal to one percent of his or her income.

5)Establish a requirement that every board member should make the Center the recipient of his or her largest gift each year, regardless of the amount; in other words, none should make a larger gift to any other organization.

6)Establish a give-or-get policy, that is, set some minimum amount that every board member is required to either give personally or raise from other sources in the community.

Possible questions for discussion:

1)What are the pros and cons of each approach suggested by the consultant?

2)What do you think will be the likely reaction of the board to each suggested approach?

2)Can you think of other alternatives beyond those suggested by the consultant?