How can you ask people to invest in a cause you believe in, if you haven't given money yourself? As Senior Program Associate Jeff Baird explains in this week's post, that's one of the reasons Rasmuson Foundation puts such a high priority on board giving.
Prospective grant applicants frequently ask about our board giving policy. To summarize, the Foundation expects that nonprofit board members make meaningful cash gifts to their organization at least once a year.
We believe one of the primary responsibilities of a board is to ensure the nonprofit they lead is on sound financial footing. When board members make cash gifts to their organization, they show their understanding that raising funds is essential to the financial stability of their organization. Rasmuson Foundation recognizes that volunteering is extremely valuable. But dollars and services are not interchangeable. Volunteerism can’t do it all. Operating a nonprofit takes money, and we believe at least some of it should come from the people charged with leading the organization.
This policy has its roots in the banking principles of Elmer Rasmuson. He believed those seeking investment should demonstrate their commitment by having “skin in the game” – before they ask others for financial support.
But what constitutes a “meaningful” donation? This is a measure that is specific to each individual. For one grantee, a board member who was homeless gave $1. For others on the same board, the giving ability was much higher.
While we leave it up to the organization and its board members to decide, this is a fair question for us to raise in the review process. If you’re seeking a grant, be prepared to discuss it.
Among other questions we often hear on board giving:
Can I donate on behalf of someone else? No. It doesn’t count unless it comes from the individual. That’s the whole point.
My business/employer donates to my charity, does this count? No. See above.
Does my board contribution have to be to the specific project for which we are requesting funding? No.
If I serve on a board as a requirement of an elected or politically appointed position, do I have to make a cash gift to that organization? In this case, board members are exempt from the policy.
Does an item I purchased at our annual fundraiser count as cash giving? No. When you spend money at an auction, you receive a tangible benefit often equal to or greater in value than what you paid. This does not constitute a cash gift.
Does donating an item count as a contribution? Depends. While the old computer workstation you donate might have value for IRS tax purposes, you should still ask yourself whether the donation is meaningful according to your own ability to give.
Do my volunteer hours satisfy the requirement for board giving? Rarely. The volunteer time you contribute as a component of your board service is important, but usually does not satisfy the requirement for board giving.
I contribute to my organization via Pick.Click.Give. and United Way, does this count? Absolutely!