This blog was originally posted on the North Carolina Community Foundation's blog, Many Voices.

I guess any job title that includes the word "regional” is probably going to require some travel. That is certainly the case for me, personally, as the Northwest "Regional” Associate with NCCF. I cover ten counties and spend a fair amount of time in the car. I could probably write a pretty interesting blog post on the wide range of inclement weather gear, office supplies, Nalgene bottles and other apparel you might find in my Subaru. Instead, as we are within the brief period of time each year when debates about ACC basketball reach a temporary truce, I would like to take this opportunity to honor the legendary Carolina basketball coach, Dean Smith.

I have recently been listening to Coach Smith’s The Carolina Way:Leadership Lessons from a Life in Coaching as an audio book while driving to board meetings and visits with donors and nonprofits across Northwest NC. One of the greatest and most respected college coaches of all time, Coach Smith describes the backbone of his coaching philosophy — the approach to the game that he tried hardest to instill in his teams—as these three key principles: 1) Play Smart, 2) Play Hard, and 3) Play Together.

The Carolina Way was written, in part, to offer insight on how professionals in other careers can incorporate some of the ideals, habits and perspectives that helped Coach Smith consistently achieve success and earn respect from players, fans, other coaches and an entire university community over many years. Here are some thoughts on how these principles apply to my work at NCCF:

Play Hard: This one I get. I was always a pretty scrappy rebounder. At NCCF, visiting with donors and nonprofits and providing support for my affiliate boards and fundholders is kind of like diving for loose balls or hustling up the floor on a fast break: the small things that require extra effort can make a big difference over the course of a game, season and career.

Play Smart: Coach Smith ran his practices with absolute precision and expected his players to learn and execute complicated defenses and a fast-paced offense. For me, organization, attention to detail and sound preparation are important areas that I must continue to cultivate.

Play Together: At NCCF I am part of a team. I don’t see some of my teammates that often as many are in Raleigh and others are across the state. My colleagues in Finance, Communications, Development and Community Leadership can and do provide assistance, resources and expertise beyond my individual set of knowledge and skills. No doubt that taking more opportunities to learn from and engage my teammates would make me better at my job.

Despite where your basketball allegiances lie, it’s hard to argue with Coach Smith’s record, his generosity and integrity, and his commitment to his players. I’m sure one could make a very similar argument for Coach K — but I will leave that to one of the two Duke alumnae that I am fortunate to work with at NCCF.

John Francis is the Northwest Regional Associate with the North Carolina Community Foundation.

Technology and communications strategy changes happen fast. Keeping your foundation up to speed can seem like a full time job and thinking about how these changes effect grantee organizations is a whole another animal. Fortunately, our sector has a number of great organizations who research and share information periodically to keep the rest of us in the know. Here are four recent reports that can help you navigate the windy path.

5 Best Practices for Creating Effective Dashboards (Tableau)
Dashboards are powerful because, if created well, they pull together different views of information in a single place, providing one of the most impactful ways to visualize data. To many, the idea of creating an effective dashboard is a pipe dream. They can be hard to configure or take forever for a centralized business intelligence group to create. They can be difficult to update rendering the data meaningless soon after it’s built. If they fail to follow dashboard best practices, they can be hard to understand when cluttered with too much – or the wrong – information. Take hold of the potential of dashboards and start making them part of your analysis approach. Dashboards can be easy and fast to create, sharing meaningful metrics that make a difference in your decision making efforts. Use this whitepaper to understand 5 dashboard best practices that will make an impact on your day-to-day life – and 7 mistakes you want to be sure to avoid.

Data at a Foundation’s Fingertips: Creating and Building Effective Dashboards (TAG and Idealware)
Technology Affinity Group (TAG) commissioned this report on how foundations use dashboards, which combines insights from conversations with 10 different foundations--including previous research on methods for thinking about data-based decision making--to offer a step-by-step process to design and create your own dashboard. To help you learn from the experiences of those foundations that have gone before you, we also included eight detailed case studies of foundations that have created their own dashboards and what into the design and implementation process.

Getting Started with Data Driven Decision Making (NTEN)
Could you use more help thinking through how to use data to help your organization make decisions? If so, you’re not alone. Our recent report on how nonprofits are using data showed that although some organizations are relying heavily on data, a number were doing very little to actually measure their work or use the data to inform other decisions. Measuring may not be as difficult as you suspect. When we talked to experts, they agreed that simply starting to track a few strategic metrics was a huge step toward a more data-driven culture. Once your staff has data that they can use to make decisions, they will often start to want more. A few, straightforward metrics can start the snowball to a more broad-based program. Getting started isn’t a trivial process, however. What metrics will be useful and actionable—but not require a ton of time to collect and understand? How do you define and communicate data in order for your organization to make decisions? This workbook will help you with those questions.

A Funders Guide to Supporting Technology: 10 Ways to Build Your Grantees’ Tech Savvy (Idealware)
Wouldn’t it be nice if there was a single project you could fund that would have a positive impact throughout all your grantees’ programs and services? There is: technology capacity building. While technology in and of itself will not save lives or end world hunger, it can have a powerful effect on every organization’s mission. Properly supported, the right technologies can build your grantees’ effectiveness and efficiency and multiply the impact of your other grants and programs. Many foundations are reluctant to support technology projects. As a result, many nonprofits are reluctant to directly ask for that support. Idealware created this guide as a resource to bridge that gap. Inside, you'll learn why nonprofits need your help with technology, how you can fit technology capacity building into your current work and granting guidelines, and 10 ways you can support your grantees’ technology capacity, complete with case studies of foundations that have seen success implementing those tactics. At this end of this guide, you’ll find resources to help you implement your own technology capacity building program.

Earlier this month, NCNG released and RFP to solicit communications firms to developing and delivering intensive strategic communications capacity building training. This project will be the first collaborative effort among foundations in North Carolina to collectively build the capacity of their grantees’ communications efforts. After first piloting this project with a few grantees per foundation involved, the funders envision expanding this training to more grantees as well as bringing in other interested foundations and their grantees, based on the results of the pilot.

Strategic communications is a vital aspect of helping nonprofits meet their missions and positively impact their communities. This training should increase individual capabilities and therefore also increase organizational effectiveness. The intensive nature of the program will give grantees the tools and information they need to plan and implement strategic communications into their programmatic work through a combination of assessments (pre, post, and periodic), in-person training, one-on-one follow-up coaching, and follow-up webinars on various topics. Throughout the course of this program, grantees should develop their knowledge around strategic communications planning, in addition to learning practical communications skills, tools, and approaches for identifying specific goals and appropriate audiences.

At the end of the program, the firm will provide a report that documents the process, successes, lessons learned, and take-aways to help inform and guide future trainings and other similar programs.

Contact Cindy Frantz if you’re interested in learning more about this project.

Registration is now open for Healthy Community Institute (HCI), a two-day intensive staff and board training for nonprofits throughout NC. The spring session will take place April 24-25, 2013 in New Bern. Registration closes on or before April 12 depending on availability as it is first come, first serve up to 50 organizations.

HCI focuses on the fundamentals of strategic planning, board development, fundraising and managing to a results-oriented framework. This has proven to be an amazing resource for our communities and nonprofit organizations. With information-packed sessions and one-on-one consulting, the Institute is just one of the ways that we are working to help build the capacity of nonprofits and increase their impact.

If you know of a nonprofit that wants to improve its organizational effectiveness, we hope you’ll send them to the information page on the Foundation’s website to register. The cost is free for organizations to attend, but what they’ll learn is extremely valuable.

Many grantmakers fear that making a disproportionately large gift to an operating charity might "tip” the charity out of compliance with the public support test, thereby causing the charity to be reclassified as a private foundation. In our experience tipping is rare, but when it occurs the consequences are significant for the operating charity grantee and in more limited circumstances to the private foundation grantor. Public charity grantmakers such community foundations and collective giving funds, however, for the reasons discussed later need not fear tipping. There are a myriad of practical concerns for all grantmakers when making windfall grants to operating charities, of course, but this article will focus on the federal tax law implications of tipping.

Background
Tipping occurs when a large contribution from a single donor causes an operating charity to fail to meet the requirements of the public support test. An organization that qualifies as a Section 509(a)(1)/170(b)(1)(A)(vi) public charity based on its public support, however, must calculate its public support ratio over a 5-year measuring period to the satisfaction of the Internal Revenue Service (the "Service”) in its annual Form 990. All the gifts received by the organizationgo in the denominator of the public support ratio, but gifts from individuals and certain corporate entities (including private foundations) are capped in the numerator at 2% of the total gifts received. Tipping occurs when very large gifts are capped at a low number in the numerator, thereby causing the public charity to have less than 33% and, in some instances, 10% public support.

A couple of caveats: Keep in mind that some operating charities, like churches and schools, are not required to demonstrate to the Service that they are publicly supported. The rules to calculate public support for Section 509(a)(2) public charities differ from the Section 509(a)(1) rules, the description of which is necessarily oversimplified at times in this article.

Private Foundation Grantmakers
Following are a few simple examples that illustrate the basic rules for Section 509(a)(1) public charities that receive gifts from private foundations and explain why tipping is rare: If a public charity received $100,000 from 100 donors who gave $1,000 each there would be no capping (because the $1,000 is less than the 2%/$2,000), the charity would receive 100% public support. What if $35,000 came from 35 donors at $1,000 each and $65,000 camefrom a private foundation? In this scenario, the public support would be 37%because the private foundation gift would be capped at 2% ($2,000) in the numerator but the entire amount would be in the denominator. But, that's not even a problem because a Section 509(a)(1) organization only needs33% and, in some instances, as low as 10% public support to preserve its public charity status. Even if an organization failed the public support test in one year because, for example, the entire budget was funded by a single private foundation, the charity would still have three years to obtain adequate support from the general public to protect its Section 509(a)(1) status.

As mentioned earlier, the consequences are significant for grantees that forfeit their public charity status due to tipping and are forced to comply with the many private foundation restrictions that would not otherwise apply including, for example, mandatory minimum distributions, net investment taxes, and expenditure responsibility rules. With planning, however, a private foundation grantor can avoid the adverse consequences (i.e., expenditure responsibility obligations) of tipping. The Service has stated that a private foundation cannot be penalized for tipping a grantee so long as (1) the grantee has a valid determination letter at the time the grant was made; (2) the Service has not revoked the letter and the private foundation is not aware of imminent action by the Service to do so; and (3) the private foundation and/or its disqualified persons do not directly or indirectly control the grantee. Note that this safe harbor applies equally to grants for Section 509(a)(1) and Section 509(a)(2) public charities. Accordingly, best practices for private foundations when making a large gift to a small organization include:

• Confirming using the Service’s "Exempt Organizations Select Check” database (http://apps.irs.gov/app/eos/) that the organization is a public charity;
• Including a statement in the grant agreement that (i) the grantee will notify the grantor of any change to its public charity status, and (ii) that the grantee is not controlled by the private foundation and/or its disqualified persons; and
• Documenting these due diligence practices in the foundation’s grant records.

Dianne Chipps Bailey is an attorney with Robinson, Bradshaw & Hinson, P.A., in Charlotte, North Carolina. Her practice is dedicated to the representation of nonprofit organizations, their senior management and volunteer leaders. Dianne has extensive experience advising a diverse group of nonprofits in all aspects of their organization, administration and management. Dianne may be reached at (704) 377-8323 or dbailey@rbh.com.