How full is the glass?

I had a friend once tell me that when he saw a certain person on the street, he did his very best to avoid them. He would even cross to the other side of the street. I asked, “why?” and he said, “because I can be having the best day of my life and then I start talking with that person and they let the air right out of the balloon and I become instantly depressed.” I thought “wow” and what a way to be labeled by somebody else. Unfortunately, it is true with many people.

I have to watch myself because if you observe the bleak picture being painted for us on the news, it can be pretty depressing. I have this recurring thought of being in a long line of hundreds of people waiting for soup or having to give up my house and move in with my older brother. These are not good thoughts.

Then I think about all those people who have far less than me, and yet they don’t complain about anything. They are so happy with the simplest things in life. Some of the most unselfish, caring and spiritual people with the best attitudes I have ever met are people with modest means. They are not trying to “keep up with the Jones” or impress anyone at all. They are who they are and believe what they believe and that is just fine with them. It just amazes me how many that happens so many times.

So, even in the worst of times, I am developing a better attitude about things. I am not going to complain about my 50-something back, or how cold it is, or how the price of something has gone up or how bad the driver is in front of me. I am going to take the high road just like a lot of the people who really have something to complain about but don’t.

I once watched a speaker from Chicago pour tea into a 12-ounce glass halfway. He looked at it and said, “It is up to you how you interpret the glass of tea. It is either half empty or half full.” Personally, I am voting for “half full” from now on. It just seems much easier to me and I bet I will be a lot happier too. So, have a great day, week, month, 2010 and life! Things look really great to me.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina

Thinking About the Year End

As we approach the end of the calendar year, there is hopefulness among charitable organizations that something good is going to happen. There is a hope that people will feel more benevolent during the holiday season and give money. They recognize that the first 11 months of 2009 have been far less successful than anticipated. Organizations are “holding out hope” that this final month of the year will “pay off” financially. Additional optimism occurs when charities think about donors who need a tax break and will give generously to their organization.

What a wonderful fantasy they are having. I don’t think there is much chance this will happen in December 2009. Why? Well, most people are either struggling to make ends meet (average incomes), need assistance from others to survive (below average incomes) or lost 55% of their portfolio in the stock market (higher incomes). Those who lost money are trying to recover those funds and are worried about their own future retirement possibilities. Any of these three scenarios does not bode well for charities this year end.

The good news; I believe, that 2010 will be a far better year for all charities. I truly believe we have weathered a very tough storm and that we can begin repairing our organizations next year. Charitable giving will improve in 2010 and it will improve in the business, grant making and individual/private sectors. So, don’t expect a huge windfall in December, it likely won’t come. Do expect more funds and better circumstances for all of next year. I really think help from generous supporters is just around the corner and better times are ahead for charities.

Happy Holidays to All.

Tom Keith is the president of the Sisters of Charity Foundation of South Carolina

It's Time to Remove South Carolina's Handicap: Why TANF Reauthorization is Crucial

How much is a child in South Carolina worth? Not nearly as much as a child in Connecticut according to the federal program designed to alleviate poverty. The federal government provides the state of Connecticut with $1,052 a year for each child in poverty. The same federal fund values poor children in South Carolina at $179 per child. And it’s not just in South Carolina; it seems children throughout the South are worth less than their counterparts in other parts of the nation.

Apart from our underfunded school systems or our high unemployment rates, federal welfare reform legislation hinders the many southern states like South Carolina from achieving its desired results. South Carolina gets less federal money to lift families out of poverty than almost any other state.

Before welfare was reformed in 1996, funds were allocated based on a formula which required states to provide matching dollars to draw down federal funds. Thus, states with higher per capita incomes, and therefore a higher tax base, could draw down more federal funding. States with small tax bases, like South Carolina, had few dollars to invest and, therefore, got few dollars back.

When welfare reform was passed, a new program called Temporary Assistance for Needy Families (TANF) was established. The goal of TANF is to move families from welfare to work. To achieve this, these families receive assistance in job training and job skills and assistance to reduce the barriers they face in obtaining and maintaining employment, like transportation and childcare. Most of South Carolina’s families receiving TANF assistance are single parents with one or two children. Currently our state has only enough funds to serve 25% of the families eligible for childcare assistance. And it has even fewer dollars to address a family’s need for transportation and training.

The most difficult part of this new welfare reform bill was figuring out how to distribute the block grant to states. Naturally, high-income states sought to continue getting the big federal dollars they received under the old program, while low-income states desired a new formula based on the number of families in poverty living in each state. This time, like many times before, the high-income states, often with larger delegations, won the fight and received the lion’s share of the money. Federal funds were allocated to states based on the average amount of funds received for the prior three-year period, which was under the old program. Low-income states were left with the task of implementing new programs and new federal requirements with very little money.

Some poor states were thrown a bone, “a supplemental payment,” in exchange for their votes to pass the welfare reform legislation. Seventeen states qualified for this bone, because their level of spending per poor person was less than 35% of the national average or they had more than a 10% increase in population from 1990 through 1994. With spending per poor person at 37.66% of the national average and only a 5% increase in population during the given time period, South Carolina just missed the mark to receive supplemental funding.

What’s more, when the supplemental funding was formed, it was frozen so that no other states could be added and the original seventeen would not lose the funding. Thus, even though a state like South Carolina qualified for supplemental funding the second year, it could not receive the additional funding. In fact, South Carolina was the only state in deep poverty that did not get any extra help. States like Kentucky, South Carolina and Virginia were held to the same federal requirements, which cost a lot more, as every other state, and were given less money with which to meet those requirements.

The law that created welfare reform, the TANF Act, is up for reauthorization next year. States are planning to ask Congress to take a look at the funding for the program and add some new dollars to make up for the buying power lost to inflation over the past 13 years. Based on the consumer-priced index, this would be approximately an additional $5 billion nationally. The new money needs to be distributed using a new formula - one based on poverty. A formula that equalizes the payments to states based on the percentage of each state’s population living in poverty would benefit 33 of the 50 states, the majority of states. It would target federal dollars where they are most needed - to states with high poverty. And South Carolina would receive a fair and equal share of the new money.

Over the last 13 years, it is estimated that South Carolina has lost approximately $150 million in TANF funding. This is money that did not go to South Carolina families moving from poverty to self sufficiency. If the amount of funding is increased using the consumer-priced index South Carolina would receive $32 million under the current formula. The amount would increase to $93 million if funds were distributed using the suggested new formula based on need. A formula based on poverty leads to an additional $61 million. This would make a significant impact on our state, and it’s now time to get our fair share of funding.

The Sisters of Charity Foundation of South Carolina envisions families in South Carolina with the resources to live out of poverty. The current funding is based on the amount a state received 13 years ago under a different program. It is an injustice to continue to use this formula, as states with the largest number of citizens in poverty will receive the smallest amount of funding. As a Foundation we feel that we must bring this to light and fight for those who cannot fight for themselves. Our state has been short-changed in TANF funding and we feel that it is time for South Carolina to receive its fair share.

The old money ($16 billion) would still use the old formula that allots for more funding for high-income states that can draw down more federal funding. Everyone wins. Everyone gets more money. TANF is designed for people out of work, and with the current economy, now is the time for Congress to reauthorize TANF.

A formula based on poverty best matches the original intent of the TANF legislation, and is the most unbiased way to allocate new federal funds. The Sisters of Charity Foundation of South Carolina is planning to do all that we can to make sure South Carolina and other southern states get an equitable share of any new TANF funding. We want to make sure Congress gets it right this time, so that South Carolina no longer has to work under a handicap. Just think of what an additional $93 million for South Carolina’s low-income families would mean.


Tom Keith is the president for the Sisters of Charity Foundation of South Carolina

An Important Faith-Based Discussion

Dr. Fred Smith, a nationally recognized Theologian, will visit Columbia next month to speak. This is not the first trip Dr. Smith has made in correlation with the Sisters of Charity Foundation of South Carolina. He came to South Carolina in 2001 to help the Foundation celebrate the Sisters of Charity of St. Augustine’s 150 year anniversary.

The Foundation, in conjunction with the United Way of the Midlands, will welcome Dr. Smith again. We will assemble several faith-based leaders in the Columbia area to discuss several important issues. The entire premise for the discussion is about the ever changing demand and expectations for faith-based organizations in community building.

It was not too long ago that churches, synagogues and other religious facilities were mainly focused on their congregations with limited outreach. Things are very different today. The faith-based sector finds themselves invested in a variety of activities and purposes that have traditionally been carried out by nonprofit organizations. There are soup kitchens, after school programs, reading recovery programs, teen pregnancy prevention efforts, fatherhood related activities, job training programs, self help and self esteem programs, food banks, clothing closets and an array of other programs far too numerous to mention.

This all happened for a reason. When welfare reform took place in the mid 1990’s a lot of government related services went by the wayside. Religious groups had to fill the gap. They have done the best they can with little training and limited resources. Dr. Fred Smith will ask the how question to faith-based leaders. How can we in the faith community work together to impact our community both from a human capital and financial perspective? Should more of an effort be made to focus on one area or neighborhood to maximize impact? Are we looking around to make sure that what we are doing is not duplicative or that we are not missing the involvement of another faith entity that could strengthen our efforts?

These are very compelling questions and should result in a lively discussion by area faith leaders. There are no easy answers to solving community problems. We are all well intended and hopeful of impact and success. I am very thankful that we are going to have this type of discussion. Religious leaders are so important to our community and our society and the role their institutions play now and in the future is critical to community improvement.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina

Let's be Realistic about Expenses for Nonprofits

I often talk to nonprofit organizations about the fact that they are all being held to a higher standard and rightfully so. They are dealing with funds that have been entrusted to them by a cadre of donors that have invested in their organization’s work. Along with that are certain standards and expectations that require a nonprofit to not only succeed in accomplishing their mission, but to succeed with extreme efficiency. My question becomes, “Is this a realistic expectation in today’s tough economy, where dollars are very hard to come by?”

The standard I am speaking about is the long established 20/80 ratio where no more than 20% of a dollar should go for fund raising, management and administrative costs and no less than 80% should go for programs and related services. In a perfect world, these are ambitious numbers and certainly demonstrate the kind of efficiencies we want and expect from a nonprofit organization. However, when times are tough and dollars are hard to come by, it may require organizations to spend more on infrastructure because they have less money to work with. In other words, keeping a program director in place to deliver services to children or keeping your bookkeeper in place to manage your systems more efficiently are necessary but may hold your costs higher and, therefore, outside the normal 20/80 ratio.

I understand this completely and I ask that we reconsider this expectation and as a fair comprise, perhaps, look at it on a three year or five year average basis. It is not unusual that ‘for profit” businesses, which are in business to make money, operate on much thinner margins and with less profit. Some grocery store chains are extremely pleased when they hit a 95/5 ratio at the end of the month. Yes, that means 95% cost to make a 5% profit.

So right now, I don’t think it is unreasonable at all to allow nonprofits to have a 30/70 or even 35/65 ratio with operating costs to program costs. We need to be sensitive and flexible with the rules at this time. I am all for accountability and efficiently run organizations but I am also a realist when it comes to making sure services are delivered by a competent and dedicated staff, recognizing that most of these organizations are being run by underpaid and overworked people. Now is the time for us to help organizations succeed and to also be pragmatic about what we expect. I truly believe the next few years will be extremely tough on the nonprofit sector and, therefore, I am willing to cut them some slack when it comes to costs. It may be the only way organizations can survive, can get the job done and get their mission accomplished and we very much need to be in tune with that situation.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina

We Have a Real Chance to Influence Change Now

In philanthropy, as we look at our sphere of influence in society today it has a wide range of entry points. Foundations are called upon to make important and tactical decisions every day. These decisions often have influence on multiple people and organizations. A great many of these decisions are internal and are based on a program, process or an initiative or an intentional direction that a foundation is headed. Boards and staff decide on size and types of grants that are awarded, a process and decision around strategy, how much to invest in program evaluation, how much to invest in communications, etc.

The sphere of influence, referenced earlier, is changing for foundations and it should be. Philanthropy is a significant contributor to communities and to society as a whole and, therefore, has a major stake in how we effect community change. So do a lot of other entities such as government, business, schools, hospitals and various other organizations. If foundations are not looking for ways to influence thinking around issues that can impact their community, region and state, then they are missing an important dimension of their work and an opportunity to get to necessary change.

For example, if a decision is being made by a municipality that will move homeless people 10 miles out of town without adequate transportation and they become isolated, shouldn’t we speak up? It is our job to look at all the issues that affect society and, in particular, see how decisions are going to affect those indigent and low-income people. Alone, these members of society do not have the power or voice to influence the decision makers.

Furthermore, decision makers are often influenced by non objective outsiders that have a vested interest in the outcome of the decision, preventing this influence from being pure and unbiased. Foundations should be objective, and their resources and connections should position them to ask difficult questions and to demand “the little guy” gets his just due in the process.

Whether we are asking tough questions of government, business or other people of influence within our societal sphere, we must step forward and be willing to play a role. Philanthropy has a lot of responsibility and it wields a significant amount of power and influence. It is our responsibility to use that influence for the greater good and let our external opportunities be just as important as our internal decision making. Foundations can no longer live and work in isolation. What we do and what needs to be done reaches far beyond the walls of our office and local town or city. Now is the time for all foundations to step forward and advocate for their grantees, constituents and those in the greatest need. If we don’t aggressively move in this direction then shame on us when the outcome is not to our liking and negatively impacts our state.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina

Foundations Can’t Live in a Vacuum

Philanthropy is often perceived as the all knowing, all deciding sector that can really change the world through strategic decision making and private funding. Foundations have high expectations of grantees including measurable outcomes and the desire for a realistic sustainability plan. However, I am not sure foundations do a good enough job of really surveying the landscape and understanding the depth and breadth of the nonprofit community and, more specifically, the organizations they fund.

Do we really know what other funders are doing for an organization that we fund and do those funds compliment what we are funding or does it work in contrast to what we are funding? It is a deeper question than most foundations won’t necessarily want to tackle, but I believe it is an important one. As an investor in the nonprofit world, we must do everything within our power to protect our investment, clearly understand the pathology of the organization we are invested in and measure our success to insure our investment is providing the return that we expect and deserve.

Long gone are the days when foundations could put money out in the community with the hope that something good happened. With the tough economy and dwindling resources, we are forced to be more focused and intentional with our grants and decision making. This has never been more apparent to me than now as we work on the Sisters of Charity Foundation of South Carolina’s Strategic Plan for the future. It requires us to maximize and leverage our funds, have a knowledge based approach to decision making and information sharing and it requires us to do a smaller number of things well. It did not have to be that way ten years ago but it has to be that way today.

Part of the equation is to have our own plan and strategies in place to insure that we know where we are going, but we must also understand the plan and strategies of our nonprofit partners. Where are they going? Do they have the resources to get there? Do they have the infrastructure to take them there? Are we on the same page as other funders or are the investments totally different and possibly contributing to the nonprofit’s organizational schizophrenia?

Our recent hiring of a full time senior research and evaluation director should tell you a lot about where we are headed. Success and failure are measured all the time. It is measured in the classroom, board room, ball fields and in our own personal performance evaluations. We, as a Foundation, are going to measure it more and understand it better. But, we should not live in a vacuum. We must also understand our nonprofit partners and know where they are going and who is helping them get there. If not, we are merely exacerbating the problem and enabling organizational ambiguity. This is not the time for anyone to be doing that.


Tom Keith is the president of the Sisters of Charity Foundation of South Carolina