Monday, December 12, 2011

The Southern Oregon Historical Society Has Raised Some Eyebrows... What Could They Have Done Differently?

Nonprofits sometimes offer us interesting news, like,  Indian Artifacts A Tough Sell for SOHS published December 4, 2011 by the Southern Oregon region's Mail Tribune and written by Damian Mann which details another example of a nonprofit's leadership making a decision to raise money through a method that has others in the museum's community at large, concerned.

According to the article,on November 28, the Medford, Oregon based Southern Oregon Historical Society (SOHS) auctioned off in San Francisco, a block of items comprised of Lakota Sioux artifacts.  The items were donated to the museum in 1957 by a Grants Pass, Oregon resident, Benjamin Bones, according to the paper.  As these are historical artifacts (one item, a Cheyenne war shirt, perhaps one of the oldest still in existence) and as the body that auctioned the item off is a museum, there are concerns, for example, as noted in in the paper, by the Cultural Resource Manager, of the Sioux nation.

Bear with me, here, in getting down the museum's point of view of the situation (as it has been quoted and reported in the above newspaper article).  It is germane to our discussion of this situation.  

To quote the newspaper, "The estimated value of the collection, which the historical society hopes will sell as one unit, is from $300,000 to $500,000.
"SOHS and other museums throughout the world undertake a lengthy process before selling or donating items that aren't appropriate to their mission but take up space and resources to manage.
"SOHS rarely de-accessioned artifacts from its collection until two years ago, when financial pressures increased and the society began weeding out items that don't have any connection with the history of Southern Oregon. Since May 2009, artifact sales have totaled $155,176."  and, "Pat Harper, SOHS interim director, said a report was commissioned in August to make sure that the sale of the shirt wouldn't violate the Native American Grave Repatriation Act.
""Items such as shirts are not covered by cultural patrimony," she said. "We wanted to be absolutely certain that we weren't defying the law."
"She said attempts to sell the artifacts to a nonprofit have met without success over the past two years.
"Harper said the historical society couldn't provide the proper preservation techniques for the shirt, which also doesn't fit with the mission of preserving artifacts related to Oregon, and particularly Southern Oregon.
She said part of the historical society's mission is to generate sufficient money to preserve the artifacts that relate to this region." and "Tina Reuwsaat, associate curator of collections for the historical society, said an attempt was made to contact Cheyenne and Sioux tribal members through American Indians at Southern Oregon University.
""We never got any responses," she said.
"Reuwsaat said the attempts to contact the Cheyenne and Sioux were more related to discovering additional information about the shirt's provenance rather than to sell it.
"If money were no object, it would be a different story," she said. "We wish we could have given it away. But that wouldn't be responsible to our mission."" and ""It's sad what's happening," said Steve Vance, tribal historic preservation officer with the Cheyenne River Sioux Tribe. "If I could stop it, I would."" and "Vance, who learned of the shirt only recently, said other institutions such as the Smithsonian have obtained American Indian artifacts over the years, and tribal officials have sought their return without success."

Interestingly, this is not the first time that this particular museum has come under fire for looking to its historic holdings to raise its funds.  In the New York Times February 13, 2010 article, Southern Oregon Historical Society looks to the Past for a Future by William Yardley the Southern Oregon Historical Society "which controls five of the most prominent historic properties in [sic Jacksonville, Oregon] a town that is itself a historic district, has proposed selling some of the sites as a way to prevent the organization’s own economic collapse".  To further quote the Times piece, "Against the growing resistance, Allison Weiss, the executive director of the historical society, said the society has had to rethink some of its plans. But she expressed little patience for complaints about them.

“What are people’s priorities?” Ms. Weiss said. “They’re carrying on that this would be a catastrophe, yet nobody’s coming forward to fund these projects.”" and "Ms. Weiss, who joined the historical society last summer, said she did not view selling the properties as a betrayal of the society’s mission. She said the society’s priority should be its collection, not preserving buildings or staging historic re-enactments in them, as has sometimes been done. Besides, she said, there is no money to do so.

"“I’m so not of that old school,” Ms. Weiss said. “What is the value of it if it’s just sitting there and no one can go into it?”"

Nonprofits and foundations, alike, provide us grant writers with excellent information that helps us develop better (and more time saving and cost effective) grant proposals, through their annual tax filings, which are public record.  For our discussion, the museum (and its fundraising arm, the museum's foundation) may be assessed by what it says about itself in its own tax filings with the federal government.  The most recent year we have to look at is for fiscal activity occurring during 2009.  Again, please bear with me and read over the following.

Looking at the museum's Foundation's federal tax filing (the IRS form 990) for 2010, on Guidestar, it appears to have paid out a little over $66,000 in grants.  Remember, what they reported on (in the 2010 filing) is 2009 finances.  The grants as listed on the return, were paid to the museum.  According to the document, a little over $55,000 in assets ("publicly traded securities") were sold to generate a majority of the grants' funds.

If we look, next, at the museum's federal tax filing (also, the IRS form 990) for 2010 on Guidestar, (keeping in mind that the 2010 filing reports on 2009's finances) its operating budget was a little over $500,000.  The value of the museum's real estate "investments" decreased.  SOHS raised a little over $50,000 in dues, a little over $200,000 in government grants, programs raised a little over $190,000, and all else raised was a bit over $120,000. "Fundraising Activities" were reported as: Mail solicitations, Solicitation of non-government grants, Phone solicitations, In-person solicitations, and Special fundraising events (and of the fundraising events, they reported a net earning of a little over $47,000).  The museum was reportedly over 99% publicly supported (the remaining 1% being investment income).

On the same SOHS 2010 tax form (reporting on 2009), interestingly:

__ In 2009 ten historical items were donated to the museum.  These were valued at $71,344 and it is telling that "the Method of Determining Revenues" is listed as "Actual Sales".

__ On the tax form's Schedule L, "Transactions With Interested Persons", a loan, noted as "Operating Funds", in the amount of $600,000 was lent to one of the then two Directors.

__ With regard to operations, on Schedule O "Supplemental Information" and under "Ceased Conducting or Significant Changes to Services" they state, "As a cost-saving measure, some of the facilities were closed to the public for a portion of the year.

__ Under "Significant Changes to Organizational Documents" they stated, "Revised bylaws were adopted...".  Under "Footnote for Art, Treasures, Etc." - they state, "Historical artifact collection primarily donated and not valued so not included on balance sheet.  Excess artifacts or artifacts not relating to organization's primary purpose have been sold and are reflected as a revenue item."

__ and under "Description of Organization's Collections And How Furthers Exempt Purpose" - the SOHS says, "Artifact collection is maintained as primary purpose of organization.  Historical items of local significance are preserved, available for research and publicly displayed."

We will use the above information to inform the following discussion about Southern Oregon Historical Society's fundraising, operations decisions, public relations, and more.

Let's use this news story as a subject of analysis:

As stated in this blog repeatedly, a nonprofit operates most effectively and successfully (in all of its operations - from programs to fundraising) when its leadership makes decisions based on the mission statement (including current organizational goals (which should also come partly from the mission and partly by the nonprofit's constituents' current but as yet unmet needs)).  The organization is defined by its mission statement.  It reports it to the governments that oversee it, and it defines itself (in part) in the public through it.  Leadership, then, must look to the organization's mission in all of its major organizational operations decisions.  If leaders do not - they are perhaps experiencing mission drift; or not familiar with contemporary, professional, nonprofit best practices, or worse.  Best practices are those because they have worked effectively, efficiently, and successfully for so many nonprofits, across the U.S., of different causes, sizes, and regions.  They also ensure a nonprofit's reputation is not potentially diminished (or worse).

For any nonprofit to operate, it must pay its bills.  In order for an organization to do that, it must fundraise all year long, every week of every month, and it helps if the organization diversifies and increases the number of the kinds of fundraising methods that it uses to do so.  Diversification of fundraising methods insures that money is coming in, the donors (and potential new donors) are being engaged in different ways that they may, as individuals enjoy, when another fundraiser isn't appealing to them (i.e. monthly donation remittance envelopes included in newsletters, for example may be easier and more convenient to some; while others may look forward and enjoy attending an organization's annual golf tournament).  If cash is not coming into a nonprofit regularly and in large enough amounts to cover an organization's operating expenses, then it must increase donations coming in, lessen its expenses, and strategize to make monthly income consistent with the organization's projected needs.

If I were to consult with the SOHS, after discovering the previously listed information about the organization, above, I would share the following concerns and suggestions:

__ The 2010 New York news piece about the potential sale of historic buildings is an example of the organization looking to is collection holdings for something to sell to raise funds.  In 2009, according to the museum's own tax return, it sold over $70,000 in artifacts it received as a donation, and the current news story about the November 2011 San Francisco auction where an auction block of Sioux artifacts clearly demonstrates this nonprofit needs to review its organizational operating budget, perhaps work with a consultant or perhaps send its board members and executive director to professional nonprofit affiliations providing trainings - but they need to learn about what nonprofit fundraising is, what works today, how it is properly done (in a way that does not potentially harm the organization's reputation, let alone its potential to develop and retain community support such as donors, volunteers, and community partners); and then SOHS needs to create a development or fundraising plan based on what was learned, the board must ratify it, and the organization needs to implement it.

__ The manner in which the then executive director reacted to community concern for the potential 2009 sale of the SOHS' historic buildings in Jacksonville, as reported in the NY Times piece, is a missed opportunity.  The organization could have cultivated community concern for the museum's own historic holdings and used it as a powerful method to raise donations, volunteers, and goodwill.  If a nonprofit tries to operate, within its community, outside of the concerns and interests of the public - it is seriously jeopardizing its public image and perhaps doing even worse harm than that.  The nonprofit that understands that without a strong relationship with its community, it stumbles, is the organization that succeeds.  In the same vein, the current interim director is quoted in the Mail Tribune article as stating that a report was commissioned in August to make sure that the sale of the shirt wouldn't violate the Native American Graves Repatriation Act, and that "We wanted to be absolutely certain that we weren't defying the law."  Yet, not defying the law does not mean that a nonprofit has not crossed a professional ethics line, or a line with the public and its trust, or worse, harmed its credibility as a nonprofit.  Still today, it seems, that the Southern Oregon Historical Society is missing an opportunity to: develop potential community partners (i.e. the Sioux nation and its cultural resources staff), to demonstrate its credibility (not trying to reach the Sioux nation by speaking to a small way out of the way, Southern Oregon, college (Southern Oregon University) to determine if the Sioux (which are based in South Dakota) would be interested in buying the historic Sioux artifacts - but instead actually looking up the Sioux nation's website (just Google "Sicangu Lakota" and call the Tribe, itself)); to demonstrate its potential to exist today and tomorrow (successful fundraising shows potential donors that yes, the organization can maintain its costs and will be here tomorrow); a commitment to the organization's integrity by working within the organization to consistently raise enough funds in a way other than selling the very historical items that make a museum - its holdings - and by having a fundraising plan in place that also proactively states what to do if the organization finds itself needing more cash or in a down economy; and more.

__ The current interim director is reportedly paraphrased in the Mail Tribune piece, "Harper said part of the historical society's mission is to generate sufficient money to preserve the artifacts that relate to this region."  Yet, on SOHS' website they state on their "Our Story" web page, "Our mission is to make history come alive by collecting, preserving, and sharing the stories and artifacts of our common heritage..  Nowhere in the mission statement of the museum does it say any such thing.  Now, the mission of the museum's foundation may say something about generating funds for the museum but the museum's mission statement does not.  You may think I am splitting hairs, but it comes down to this: how does any one nonprofit differ itself from another (think of all of the nonprofits that work on the same issue - yet do so working on different aspects of it (i.e. cancer research, cancer patient support, cancer treatment services, etc.))?  Each nonprofit, even ones working on the same exact cause or issue (i.e. cancer) must provide a real, needed, but as yet unmet service, program...ultimately an outcome to the community.  To make my point, here, even clearer: why would I (or you) donate any historic artifacts that my family has in its possession to the SOHS, right now?  I would not feel confident that the museum knows how to raise the amount of money that it needs to operate, outside of selling its own artifacts at auction.  It reportedly sells the very things that its own mission states are its reason for existing.  The SOHS, according to its own mission, appears to right now operate against its very stated reason for existing.  As a potential new donor, volunteer, or community partner, I might look at this organization's track record and ask what it is exactly that the organization's leadership uses to make operations decisions?  The current interim director (according to the article) isn't even correct about the museum's mission.

__ Looking at how much was loaned, in 2009 to one of the directors, and looking, too, at how much the Sioux collection netted, potentially, at auction last month - it is interesting that the amounts are similar (i.e. $600,000 lent, and approximately between $300,000 - $500,000 raised at auction).  Perhaps the SOHS should not have lent $600,000 in 2009?  This is another example of why a nonprofit's leadership should look to its mission when considering any major organizational decision (such as 'whether we should lend large amounts of money or not).  Lending money is nowhere in either the museum's or the foundation's mission.  I know that in the real world it is legal to do so, and not unusual, but look at the ultimate outcome for the organization (today in 2011) when the leaders made a decision outside of the mission - it led to them apparently being down, in amounts needed to operate, about the very same amount that they loaned in 2009.

__ Every nonprofit's track record is its potential to succeed.  Each time this organization has stated why it sells its historic holdings to raise money, it is interesting that the related comments (even as quoted from their 2010 tax return for 2009 finances) sounds like its in contrast with their mission.  Why would a nonprofit that exists to show the public historic artifacts then turn to the very kernel of its reason for existing and use them as the means to continue funding the organization?  Why even go anywhere near there?  What a public relations, potential to raise funds, and credibility nightmare!  It's already difficult enough to raise funds for any nonprofit.  Why take an organization down a path that potentially (in any way at all) can cause people to question the organization?  According to their 2010 IRS return, in 2009 they were holding special events, to raise funds, writing grant requests, soliciting in person and on the phone...why then, wouldn't the organization increase the number of special events it holds (i.e. host a new annual gala) , implement a bequests program, increase grant writing goals and successes, become a United Way Umbrella agency, become a part of the State Employee Giving program and other corporations' giving programs, implement a major donors program, etc.?

__ The current interim director, according to the article, sees the Sioux collection as not relevant to Southern Oregon.  I am not sure that the Sioux artifacts are not pertinent to Southern Oregon (as stated in the SOHS' mission) because the man who contributed the historic collection lived in Southern Oregon, and according to the recent newspaper piece, the museum and the Sioux Nation, itself, are not sure of the collection's significance, provenance, or how the man who donated it to SOHS came to own it.  So, then, how can the museum be so certain that the Sioux artifacts are not pertinent to the museum's own region's history (which is, according to the mission, what the museum exists to provide the public with)?  Too, not being able to provide a historic item with the necessary preservation methods required to keep it is not in direct contrast to the mission and in fact, could be a project that the Sioux Tribe might have collaborated with SOHS to do.  As I repeatedly state in this blog, grant donors, in particular (and especially in this economy) prefer to fund projects and programs in which two or more separate nonprofits collaborate.

I know that the SOHS has not broken the law, that their lending money, that selling holdings that they do not see as relevant to their mission is a common practice by museums, that sometimes decisions need to be made that the leadership would rather not do, and so on.  My point in writing this post is not to criticize the SOHS, here, but rather to use their record as an example to my readers for educational purposes.  While none of these practices that they have done are illegal, or contrary to common practices in their professional field, and so on - it cannot be disputed that they have also developed, at least in the press over the past few years, concerns among the organization's own community and beyond.  This is enough for any organization to stop, take a look at itself, and seriously assess what they have been doing that led to the tough public record, and where the organization can improve and go.

08/12/13 Another museum faces the heat for considering selling its holdings complete to various different articles sharing different thoughts on it:
Selling the Art of Detroit Is Batshit.  Exactly.

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