Transparency Talk

Category: "Open Source" (4 posts)

Staff Pick: Foundation Funded Research Explores How to Improve the Voter Experience
August 9, 2018

Becca Leviss is a Knowledge Services Fellow at Foundation Center.

This post is part of the GlassPockets’ Democracy Funding series, designed to spotlight knowledge about ways in which philanthropy is working to strengthen American democracy.

Becca 2Voting is central to our democracy, providing citizens from all communities direct way to influence the future by conveying beliefs through civic participation. Though foundations by law must be non-partisan, they can and do support democracy in a variety of ways, and we are tracking these activities in our publicly available Foundation Funding for U.S. Democracy web portal.  
 
From this data we can see that encouraging broad civic participation is one of the most popular ways in which institutional philanthropy supports our democracy. Specific strategies under civic participation include issue-based participation, civic education and leadership, naturalization and immigrant civic integration, and public participation. So, what have foundations learned from these efforts about how to strengthen our democracy? Today we will zoom in to learn from a foundation-funded report that is openly available, containing findings from data collection on elections and voting patterns, including how well the process is workingand who is included or excluded. 
 
Our latest “Staff Pick” from IssueLab’s Democracy Special Collection, which is comprised of foundation-funded research on the topic, explores an aspect of the voter experience in America that could be improvedWith less than 90 days to go before the midterm elections, we’re pleased to offer this deep dive into an important piece of voting-related research. 
 
Research in the social sector can sometimes feel inaccessible or artificial—based on complex theories and mathematical models and highly-controlled situations. This report, however, presents its research methodology and results in a clear, understandable manner that invites the reader to continue its work to understanding how polling sites can use their resources to both investigate and improve the voter experience.  

STAFF PICK

Improving the Voter Experience: Reducing Polling Place Wait Times by Measuring Lines and Managing Polling Place Resources, by Charles Stewart III; John C. Fortier; Matthew Weil; Tim Harper; Stephen Pettigrew 

Download the Report

Publisher

Bipartisan Policy Center

Funders

Ford Foundation; The Democracy Fund

Quick Summary

Voting is the cornerstone of civic engagement in American democracy, but long wait times and inefficient organization at polling places can undermine the voting process and even discourage citizens from voting altogether. In 2013, President Barack Obama launched the bipartisan Presidential Commission on Election Administration (PCEA) to initiate studies and collaborative research on polling place wait times. The PCEA’s work revealed that while wait times and poll lines are a serious issue in the United States, they are also reflective of deeper, more complex problems within the election administration system. This report by the Bipartisan Policy Center summarizes the PCEA’s efforts and highlights how the knowledge gained can produce action and improvement at polling sites. Ultimately, the report emphasizes the need for continued research and innovation in approaching common issues in the voter experience.

Field of Practice

Government Reform

What makes it stand out?

Ne report“Long lines may be a canary in the coal mine,” begins the report,“indicating problems beyond a simple mismatch between the number of voting machines and voters, such as voter rules that are inaccurate or onerous.” Quantitative and qualitative data has shown that long lines at the polls have wide-reaching economic costs of over half a billion dollars in a presidential election, as well as the immeasurable cost of voter discouragement due to polling place problems. These issues are exacerbated at polling sites that are urban, dense, and with large minority populations, where lack of resources and access can disenfranchise the voting population.

While the dilemma of election administration is complex, the report describes a rather straight-forward series of projects by the Massachusetts Institute of Technology and the Bipartisan Policy Center. MIT and BPC collaborated to create a system of data collection on polling lines and polling place efficiency that would be simple and easily implemented by poll workers. The program utilized basic queuing theory: calculating the average wait time of a voter by dividing the average line length by the average arrival time. For fellow (and potential future) researchers, this report spends a meaningful portion of time explaining the significance of each variable, how it is calculated, and how its fluctuation impacts the overall results of the investigation. We are given examples of several successful iterations of the study and their evaluations, as well as insight into certain research choices.

MIT/BPC’s work has found that an overwhelming majority of Election Day polling sites—82 percent—experienced the longest line when the doors first opened. In all, a total of 90 percent of Election Day polling sites have their longest lines within the first two hourly samples (when observed on Hour 0 and Hour 1), with the lines declining at an average rate after that. Similarly, voters experience the longest wait times when the lines were at their longest. This pattern is vastly different from that of early voting sites, where wait time is relatively constant; however, these sites still most commonly experience their longest lines at the beginning of the day (25 percent of the studied population).

The research emphasizes the importance of how to adequately prepare for the length of the longest line. The report suggests that if polling sites adjust worker shifts to accommodate for strong early morning voter turnout on Election Day, they can easily clear the lines within the first few hours of voting, thus saving money and better serving their voters. The report also recognizes the range of its results: in other words, individual precincts have individual needs. Without meaningful research, however, we cannot know how to meet those needs and improve the voter experience. Therefore, as readers (and hopefully fellow voters), we are encouraged by MIT/BPC’s work to take clear and simple action to improve our own polling sites through continued research and investigation. This report exemplifies the importance of making the research and data process transparent and attainable so that we can not only understand its significance, but actively contribute to its efforts. There are many processes that could benefit from this kind of data analysis to improve the user experience. What if foundations analyzed their grant processes in this way? I can’t help but think that there is much that philanthropy can learn from the government from reports like this that show how institutions are opening up data collection to improve the user experience for actors and stakeholders.

Key Quote

“Precincts with large numbers of registered voters often have too few check-in stations or voting booths to handle the volume of voters assigned to the precinct, even under the best of circumstances. Precincts that are unable to clear the lines from the first three hours of voting are virtually guaranteed to have long lines throughout the day. Polling places in urban areas often face design challenges—small, inconvenient spaces—that undermine many election officials’ best efforts to provide adequate resources to these locations.”

--Becca Leviss

Is Your 990-PF Working Against You?
September 12, 2017

Lauren Haverlock has practiced public accounting since 2004. As a senior manager at Moss Adams LLP, she provides compliance and consulting services to all types of exempt organizations, including public charities and private foundations.

This post is part of a Transparency Talk series, presented in partnership with the Conrad N. Hilton Foundation, examining the importance of the 990-PF, the informational tax form that foundations must annually file. The series will explore the implications of the open 990; how journalists and researchers use the 990-PF to understand philanthropy; and its role, limitations, and potential as a communications tool.

Join us at a session about the Open 990PF in partnership with Grantmakers of Oregon and Southwest Washington. Learn more or register here.

Lauren HaverlockAs a CPA specializing in tax exempt organizations, the annual 990-PF form that private foundations must file with the Internal Revenue Service (IRS) is the source of many questions I receive. And now that this data is not just publicly available, but open, it is wise for us all to take a closer look at whether your 990-PF may unintentionally be working against you.

Of course, the IRS has been gathering data on 990-PF filers for years. It has used this data to better identify and investigate anomalous and non-compliant private foundations. But now, all electronically filed Form 990-PF data is available to the general public in machine readable formats opening up the investments, portfolio performance, grant recipients, expenses, and transactions of foundations like never before.

Now that this information is publicly available in machine readable format, it can be easily aggregated to provide valuable insight into the industry as a whole. It can also highlight outliers. Ultimately, the availability of this data provides a window into private foundations, many of which were previously used to operating outside the public eye. As Glasspockets has reported, currently only 10% of U.S. foundations even have a website, so if your foundation is among the 90% that do not, that means that your 990-PF is the only source of intelligence about your organization. 

In the new world of readily available machine-readable Form 990s, private foundations will want to verify their tax filings—the source of their data—are prepared completely and accurately. Common mistakes to watch out for when filing the Form 990-PF are detailed in this article.

Transactions

Private foundations face more burdensome regulations on investments and expenses than 501(c)(3) public charities:

  • Restrictions on how money is spent
  • Requirements as to how much money is used for charitable purposes
  • Rules regarding how endowments can be invested

The consequences for noncompliance in regards to the above transactions can range from excise-tax penalties assessed on the foundation or its managers to revocation of exempt status.

Specific items to be aware of include the following:

  • Prohibited transactions with a disqualified person, including trustees, directors, and foundation managers as well as certain family members and businesses of the aforementioned.
  • Failure to meet the minimum distribution requirement in a previous year
  • Excess business holdings of an active trade or business
  • Risky asset investments that could jeopardize a foundation’s charitable purpose (for example, not having a diversified portfolio of investments)
  • Certain types of expenditures, such as foreign grants, grants to for-profit entities, unapproved scholarships, or lobbying and political activities, are either prohibited outright or require extra diligence to be permissible. 

For example, foundations are permitted to reasonably compensate a disqualified person for personal services. And an organization can grant funds to foreign or for-profit organizations if expenditure responsibility is exercised. And more details about what is permissible in regards to political funding appears below. But the main point here is just the affirmation of these closely scrutinized transactions could raise the risk profile of a private foundation.

Net Investment Income

Although considered tax-exempt, private foundations are still required to pay an excise tax at a rate of 1% or 2% of the income they generate. As such, investment income is of intense focus when foundations file their tax returns. Foundations should remember that the calculation of taxable income should be undertaken with the same tax-reduction mindset that for profit entities and individuals undertake.   

“Ultimately, the availability of this data provides a window into private foundations, many of which were previously used to operating outside the public eye.”

The Form 990-PF reports income both on a book and on a tax basis on Page one. A foundation should ensure that it is properly capturing all taxable income from all sources and not simply assuming that taxable income is the amount reported on their financial statements. For example, private foundations with “alternative investments,” including private equity, hedge funds, managed futures, real estate, commodities and derivatives contracts, could receive a Schedule K-1 from their investments. Flow-through income from that Schedule K-1 should be reported in the foundation’s tax-basis income statement. 

Additionally, any excise tax a foundation pays could bring negative attention. If an entity consistently pays the higher excise tax of 2%, it could lead donors to question why the foundation is giving money to the IRS in the form of taxes rather than providing grants.  

 

Balance-Sheet Investments

Private foundations are required to report the details of their investments, including the number of shares and types of publicly traded stock held. Reporting this can often be burdensome and feel invasive, but failure to include this information could result in an incomplete Form 990-PF. An incomplete Form 990-PF is deemed to have never been filed in the first place, which could result in late-filing penalties or revocation of exemption if it occurs three years in a row.

Lobbying and Political Activities

Private foundations are prohibited from undertaking any lobbying or political activities, unlike 501(c)(3) public charities, which are permitted to undertake limited lobbying activities. However, not all actions related to politics are prohibited—private foundations can undertake certain bipartisan educational activities or support charities that undertake lobbying if they follow certain guidelines. For example, the specific project grant rule, when followed, could allow a private foundation to fund a project that explicitly has lobbying activities.

Grant Reporting

The grant reporting schedule seems innocuous, but it can weave a story of relationships that extend beyond grantor and grantee. The grant recipients of private foundations are public, which means the public can gather data regarding which organizations a foundation supports by using data-mining tools.

Open-990-borderAlthough this information can be valuable to fundraisers and your grantmaking peers, it can also reveal an informal or unclear grantmaking process and serve as an inadvertent disclosure of taxable expenditures. As such, a foundation should ensure that there is a due diligence process related to grant recipients that verifies if a recipient is a qualified 501(c)(3) public charity, and use the space provided in the 990-PF (Part XV) to explain its grantmaking process, deadlines, and eligibility requirements.

While grants to other types of entities are permitted, if certain expenditure responsibility procedures are not followed, this type of granting could possibly raise a red flag. Any grantee that reports a foreign address, appears to be a corporation, or otherwise stands out could still garner a foundation unwanted attention from the general public and IRS. Grantmakers making grants to foreign organizations also have the option of using a process called equivalency determination to demonstrate how they determined that a foreign organization is equivalent to a U.S. charity. The grantmaker is required to collect a specific set of data, as outlined in IRS Revenue Procedure 92-94, that provides details about the grantee’s operations and finances.

Private foundation contributor schedules are public, which means anyone can pull these donor lists. With open-source data, foundation support can be easily compiled and aggregated to better understand an ecosystem of donors and support—keeping a private foundation accountable to the community it serves.

Even though the Form 990-PF is a government filing, its public nature and the increased openness of its data may lead to both greater interest and scrutiny in the private foundations filing it. Take control of your financial story by filing timely, complete, and accurate Form 990 returns, paying special attention to the areas noted above, and ultimately what increases may be a greater understanding of the field itself.

--Lauren Haverlock

Crafting A Better Tap of Knowledge
August 9, 2017

Gabriela Fitz is director of knowledge management initiatives at Foundation Center. This post is part of the Glasspockets’ #OpenForGood series in partnership with the Fund for Shared Insight. The series explores new research and tools, promising practices, and inspiring examples showing how some foundations are opening up the knowledge that they are learning for the benefit of the larger philanthropic sector. Contribute your comments on each post and share the series using #OpenForGood.

Gabi Fitz photoThis past weekend, I went to visit an old meat packing plant in Chicago’s Back of the Yards neighborhood. The plant, renamed “Plant Chicago,” serves as a workshop and food production space, playing host to a number of micro-enterprises including a brewery and bakery. But it wasn’t the beer or even the pies that drew me there. It was their tagline, “Closed Loop, Open Source.”

If you know me (or the work of IssueLab at all), you know why I couldn’t resist. The closed loop approach is all about a circular economy, where we take “waste from one process and re-purpose it as inputs for another, creating a circular, closed-loop model of material reuse.” It’s a simple principle and one that I imagine most of us would get behind.

But what’s not so simple is building and maintaining those closed loop systems so that people begin to see (and taste) the benefits. Standing in the lobby of Plant Chicago it was painfully clear to me that circular economies, whether they are in food production or in knowledge production, require more than just good intentions.

Plant Chicago
Plant Chicago, a workshop and food production space, hosts micro-enterprises, including a brewery and bakery. Credit: Gabriela Fitz

Just as I started to feel the familiar weight of trying to execute systems change, I spotted a small sketch of a pyramid amongst a number of technical diagrams and development plans covering a large wall. This simple sketch was similar to a model many of you are probably familiar with but  is still worth describing. In the sketch, the base of the pyramid was labeled “beliefs and values.” The next level up was “practices and actions.” The top of the pyramid was “results.”

When it comes to the closed loop we care so much about at IssueLab, we keep seeing organizations try to skip from beliefs to results. The social sector wants shared learning without sharing; collective impact without collectivized intelligence. But open knowledge - like any sector-wide or organizational change - has to include a change in practices, not just beliefs. If we don’t adopt open knowledge practices, we can’t expect to see the results we hope for: improved program design and delivery at the community level or less duplication of avoidable mistakes. If we truly want to live up to the #OpenForGood ideal, our beliefs and values are simply not sufficient. (Note that the definition of closed loop I quote above is not about beliefs, it’s about actions, relying on verbs like “take,” “re-purpose,” and “create.”)

The good news is that we have the infrastructure to make a circular knowledge economy possible. We’ve built the plant. Tools like open licenses and open repositories were designed to facilitate and support change in knowledge sharing practices, making it easier for foundations to move up the levels of the pyramid.

Now, we just need to start taking a couple simple actions that reflect our beliefs and move us towards the results we want to see. If you believe in the #OpenForGood principle that social sector knowledge is a public good from which nonprofits and foundations can benefit, your foundation can: 1) use open licensing for your knowledge products, and 2) earn an #OpenForGood badge by sharing your knowledge products, like evaluations, through IssueLab’s open repository. Once those practices are as much part of the normal way of doing foundation business as cutting checks and producing summary reports are, we can all sit back and enjoy that beer, together.

--Gabriela Fitz

Overcoming Website Angst: Keeping it Simple, Easy- to-Manage and Cost Effective
April 15, 2015

(Sally Crowley is the communications director for The John R. Oishei Foundation.) 

Sally Crowley Did you know that less than 10% of all charitable foundations h ave a website? It seems unbelievable in this day and age, but research conducted by Glasspockets finds that it’s true.

When you think about it, though, it’s actually understandable. Building a dynamic, professional website can be a daunting task. Maintaining it with up-to-date content can be even more daunting. Plus, some price tags will just give you sticker shock… and maybe a bit of angst.

So was the case with ours here at The John R. Oishei Foundation.

When I first started working with the Foundation in 2006, its website was built in HTML and had about three pages, basically listing contact information and directions on how to apply for funding. This was a typical foundation website at the time.

We set out to create a more contemporary, content-rich site… a site where we could feature the work of our grantees, share information and disseminate key research findings.

In 2007, driven by the goals outlined in our strategic plan, we set out to create a more contemporary, content-rich site… a site where we could feature the work of our grantees, share information and disseminate key research findings. We worked with a website design firm that used a proprietary Content Management System (CMS), which, at the time, was a standard way of building websites. The process was extremely labor intensive for us and involved a somewhat substantial investment.

By now, most people know the meaning of a CMS, but just in case, here’s a quick definition:

CMS is a website software that allows content contributors to publish from a central, online web interface without knowing HTML, Javascript or any other complicated computer language. And among CMS programs, you can choose “open source” or “proprietary.”

Open source software is developed by a global community and is typically available at no charge. It is developed and upgraded in a collaborative way, relying on input from thousands of people from around the world. Here’s an example.

Proprietary CMS is developed, owned, and promoted by a private company and is updated/improved at the company's discretion. Here’s an example.

Our website is an extremely valuable tool that helps us communicate with our varied audiences. As our ideas of how and what to share continue to grow, a website that keeps up with our pace has become that much more essential.

Many proprietary CMS website developers offer a “handcrafted CMS” which they claim is better than their competitors’ products. In the past, this was the primary method used to build websites. The open source alternative was not yet mature, so vendors who wrote their own software provided a unique product with relative reliability for that time.

By 2012, the site we had built at Oishei using proprietary CMS was outdated. We wanted to update the site and be “cutting edge,” yet fiscally prudent. Luckily, by then, things had changed in the world of web development. Reliable open source website platforms had become commonplace. Today, I would say WordPress, which the Foundation Center uses for its web hosting services, is probably the most well-known, followed by Joomla! and Drupal. (Our site uses Joomla!) Some open-source platforms have even become so easy-to-use that sites can be created by non-technical staffers with no actual coding, a little bit of know-how and a fair amount of determination.

I am huge proponent of open source websites. Here's why:

  • I want to own my organization's site and I want to be in charge. Using an open source CMS vendor means that I own my website, and that the code and content are portable. There's no proprietary code that can't be shared with me. The website hosting is also under my control. If I become "disenchanted" with my CMS vendor, s/he can't walk off with my site. I can hire another vendor to maintain it for us. We also asked ourselves, "What would happen if our vendor goes out of business"? These days, that could happen to any company, no matter what its size. With open source, another vendor could take over our site with little disruption. 
  • I refuse to pay an arm and a leg for substantial site changes and upgrades. The Oishei Foundation recently changed its logo, core branding elements and moved its offices. This meant many changes to our site to match our new colors, replace the logo wherever it appeared throughout the site, etc. This was too much for me to handle on my own, so our web group handled it for us. Because they use Joomla!, the cost was minimal. (Note that when it comes to spending on communication efforts, we are "uber" frugal -- we'd rather use the funds to support our community.)
  • We want to stay up-to-date. In the ever-changing digital world, new design standards develop frequently; new website features pop up all the time. In addition, there's the human element. People just get bored with what they have over time. So, even though our audience might not be tired of the Buffalo skyline photo featured on our home page, our staff and board might be. Plus, who doesn't love a new bell or whistle on their site from time to time? Open source CMS vendors have a large team of active core developers, and many more third party extension developers as well. They are much more likely to offer new technologies and features faster.

Our website is an extremely valuable tool that helps us communicate with our varied audiences. As our ideas of how and what to share continue to grow, a website that keeps up with our pace has become that much more essential. Open source platforms are always improving, with developers constantly and collectively experimenting with new ideas. This means that as we become more open about the work we do, our technology is right there with us, helping us to communicate even more effectively.

What has your foundation’s experience been with proprietary vs. open source? 

--Sally Crowley

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About Transparency Talk

  • Transparency Talk, the Glasspockets blog, is a platform for candid and constructive conversation about foundation transparency and accountability. In this space, Foundation Center highlights strategies, findings, and best practices on the web and in foundations–illuminating the importance of having "glass pockets."

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