For many non-profit organizations, the weeks leading up to the holidays of Hanukkah, Christmas and Kwanzaa – the season of giving – provide the opportunity to raise much-needed funds for our program work and general operations. After the long, dry summer months, the fall fundraising push reaches its zenith for many nonprofits around year’s end.
Non-profit organizations around New England and the country raise this money to redouble our efforts to service our constituents and realize our mission. The donors who provide the funding expect no less.
Funds in Limbo…
However, a group of U.S. nonprofits have been prohibited from providing the services for which the charitable donor funds they received were intended. The funds were seized by the Office of Foreign Assets Control, according to Treasury Secretary Henry Paulson, because the groups are allegedly associated with terrorism. The humanitarian groups which received the donations argue that the funds were earmarked to assist areas of the world affected by natural disasters, hunger and extreme poverty.
Last month a group of non-profit organizations from across the United States called on Treasury Secretary Henry Paulson to meet to discuss a proposal to release the frozen funds. TSNE signed on to the November 6, 2006, letter to Secretary Paulson, saying that the organizations signing the letter took “no position on whether these designations were appropriate.” As stated in the letter, “Instead, our concern is with ensuring that charitable funds are put to good use.”
… While Humanitarian Needs Grow
In the letter, the nonprofits also said that “most of these funds come from relatively small donors who intended to provide food, medical care, shelter, education and other basic needs to refugees, people displaced by war or famine, and others in need. Many of these donors are Muslims whose giving fulfills a religious obligation.”
OMB Watch, a national Washington, D.C.-based nonprofit and the lead organizer for the advocacy with Secretary Paulson, estimates that more than $13.7 million is being held in frozen accounts. Our joint letter to the Secretary noted that while the Office of Foreign Assets Control continues to freeze the accounts, “the need for humanitarian assistance is not frozen and has continued to grow.”
OMB Watch has posted a legal memorandum outlining Treasury’s power to arrange the release of these funds.
Need for New Policies
Some of the affected funds have been held for over four years. TSNE and other nonprofits that signed onto the letter to Secretary Paulson are calling on Treasury to update its policies to keep pace with the current realities of the post-September 11 world. A number of our colleagues have volunteered to meet with the Secretary to discuss the need for procedures to ensure charitable dollars are spent for charitable purposes.
What Your Nonprofit Can Do
Like the other Paulson letter signatories, TSNE believes that our nonprofits must do adequate due diligence to see that our all assets are used for charitable purposes and diverted for other purposes. Nonetheless, the government needs to allow charitable funds to be used for the designated purposes.
Let Secretary Paulson know that you want Treasury to release the donations seized and update its policies to work with nonprofits, not erect bariers between donors and nonprofits.
In the ED Forum, TSNE’s Executive Director Jonathan Spack reflects on issues facing non-profit organizations in and around the Boston area and across the nation. Follow Jonathan on Twitter @JonathanSpack.