The Problematic Shift from ‘We’ to ‘I’

I read something truly fascinating the other day that is indicative of a troubling trend in our nation: During the past 50 years, in all the books published in the United States, the frequency of the word “I” has doubled.

This fact comes from Robert Putnam’s book, The Upswing: How America Came Together a Century Ago and How We Can Do It Again. Putnam is a Harvard professor best known for his groundbreaking research into our country’s loss of social capital. He summarized his original findings 25 years ago in the landmark book Bowling Alone. 

The title comes from Putnam’s observation that more Americans were bowling than ever before, yet rather than joining with friends and neighbors in bowling leagues, most were, instead, bowling alone. His research documented the slow erosion of interpersonal connections that have bound Americans together for generations.

The predilection of Americans to join with one another in service of a common purpose has been the essential ingredient in our country’s success. Consider the document that gave birth to our nation, the Declaration of Independence. It begins with our country’s founding principle: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.” Yet to realize these rights, our founders set forth an equally important and, at the time, uniquely American principle: that our success as a country requires us to commit to our fellow citizens. 

Our founders explicitly rejected the idea that a monarchy, church or aristocracy should command our loyalty. They were imagining a new kind of nation in which our first loyalty was to each other, so they explicitly bound themselves to one another. Recall the last sentence of our most hallowed national document: “And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.”

During the 25 years since Bowling Alone, Putnam has documented that the decline of our shared commitment has only accelerated. In The Upswing, he identifies common trends across economics, politics, society and culture. He defines a “meta-trend, a phenomenon we have come to call the ‘I-we-I’ curve: a gradual climb into greater interdependence and cooperation [which peaked about 50 years ago], followed by a steep descent into greater independence and egoism [today].” 

This waning of one of the founding principles that is essential to American greatness – our willingness to mutually pledge to each other our lives, our fortunes and our sacred honor – is undermining the very thing that makes our liberty possible.

Two centuries ago, Alexis de Tocqueville, a young French political scientist, visited the United States to study our new form of government. His book Democracy in America remains an iconic summary of American society and political life.

“Americans of all ages, all conditions and all dispositions constantly form associations,” wrote Tocqueville. “If it be proposed to inculcate some truth, or to foster some feeling, by the encouragement of a great example, they form a society.”

This was a completely foreign concept to Europeans such as Tocqueville. In his experience, ordinary people did not voluntarily band together around causes of their own choosing. 

“I met with several kinds of associations in America of which I confess I had no previous notion; and I have often admired the extreme skill with which the inhabitants of the United States succeed in proposing a common object to the exertions of a great many men, and in inducing them voluntarily to pursue it.”

Tocqueville was surprised that these associations of ordinary people weren’t organized or led by those of high office or great public stature. Instead, they were gatherings of regular citizens. This simply was not how things were done in the “great” nations of his time.

“Wherever, at the head of some new undertaking, you see the government in France, or a man of rank in England, in the United States you will be sure to find an association,” wrote Tocqueville. “Thus, the most democratic country on the face of the earth is that in which men have, in our time, carried to the highest perfection the art of pursuing in common the object of their common desires, and have applied this science to the greatest number of purposes.”

This ability to come together in common purpose, to commit to one another as a united people, has long formed the central tenet of American exceptionalism. Yet as we increasingly turn away from the “we” to focus on the “I,” it has become politically advantageous for demagogues to demonize those who are different or who have opinions that differ from their own. Rather than enter civic life rooted in a shared identity as Americans, we are increasingly segregating ourselves by our differences and thereby losing our willingness to commit our lives, our fortunes and our sacred honor to each other in service of the whole. The implications of this shift are profound and enormously troubling.

“As Tocqueville rightly noted, in order for the American experiment to succeed, personal liberty must be fiercely protected, but also carefully balanced with a commitment to the common good,” writes Putnam. “Individuals’ freedom to pursue their own interests holds great promise, but relentlessly exercising that freedom at the expense of others has the power to unravel the very foundations of the society that guarantees it.” 

Thankfully, the lessons of our past form a road map for our national rejuvenation. Putnam notes that between 1870 and 1920, Americans founded more civic organizations at a greater rate than at any other point in history. This explosion of shared civic action formed the foundation of a renewed national commitment to serving a common – and more inclusive – good.

Consider the collective national accomplishments that were to follow: victory over Nazi tyranny, women’s suffrage, overcoming the Depression, rural electrification, civil rights, the national highway system and so many other blessings that we all enjoy today. The seeds of these shared national successes were planted in ground made fertile by earlier local collective efforts in communities across the nation. 

Today, hope can be found in the rebirth of local organizations and charitable groups whose work reminds us that the “we” must be central to our identity if our communities and our nation are to thrive. 

In my next column, I’ll write about some of the efforts underway on our peninsula to help the people of Door County bind themselves to one another in service of a better future for us all.

This article was written by Community Foundation President and CEO Bret Bicoy and originally appeared in the Peninsula Pulse.

Insights on Giving in Affluent Households

For nearly a decade, the Bank of America Study of Philanthropy: Charitable Giving by Affluent Households has been conducted in partnership with Indiana University’s Lilly Family School of Philanthropy. It is the most comprehensive, longitudinal study of the giving habits of America’s wealthy families. The study’s 2021 version was recently released and offered insights and lessons for our charitable community.

Let’s begin with a definition. For purposes of this study, “affluent households” are those with a net worth of at least $1 million (excluding the value of their primary home) and/or having an annual household income of at least $200,000.

Perhaps the most heartening news for folks like me who work in the world of philanthropy is that ours is by far the most trusted segment of society. That is, when members of wealthy families are asked which entities they most trust to solve society’s intractable problems, nonprofit organizations are at the top of the list. 

America’s charitable sector is trusted 24% more than small businesses, 42% more than churches, 44% more than the president, 56% more than large corporations and 67% more than Congress. About seven out of every eight people in affluent households express some reasonable level of confidence in the nation’s charities and philanthropic organizations. Not surprisingly then, especially considering their wealth, affluent households donated 17.5 times more money to charities than donors in the general population. 

What is surprising is the enormous disparity in the rate of giving, even if you exclude consideration of the size of the donation. Of affluent households, 88.1% make a gift to charity every year while only 48.8% of the general population does. In other words, affluent households are 80% more likely to donate to charity in any dollar amount. 

Further, the gap in the giving rate between wealthy families and the country as a whole grows even larger if you exclude churches from the statistics. Affluent households are more than twice as likely to give to a nonchurch charity compared to the population as a whole.

Interestingly, younger and older generations of affluent Americans are increasingly approaching giving from a different perspective. Younger people are significantly more likely to say that concern about a specific societal issue is the fundamental motivation behind their giving decisions, regardless of the charity that ultimately receives the gift.  Conversely, older Americans are far more likely to say that faith and confidence in a particular organization are why they donate, rather than to confront a single issue facing society.

The study also found that affluent families are becoming far more savvy about the enormous tax advantages of using giving vehicles to facilitate their charitable donations. Since 2017, nearly 50% more of America’s wealthy families have begun using a Donor Advised Fund as a means to simplify and centralize their giving. Similarly, during that same time period, 42% more wealthy families have added a charity as a beneficiary of their estate plans.

One of the more recent trends among affluent households is the use of impact investing to achieve philanthropic goals. Impact investing involves making financial investments in for-profit companies with the intention of generating positive, measurable social and environmental impact alongside a reasonable financial return. 

About one out of every seven wealthy families explicitly uses an impact-investing strategy to achieve both its financial and philanthropic goals. Although this still remains a relatively modest portion of affluent households, the trend is clearly pointing up. Since 2017, nearly twice as many wealthy Americans have begun participating in impact investing.  

Finally, only 11.9% of affluent households did not give anything to charity last year. The most common explanation, offered by 30.9% of wealthy Americans, is that a family need took priority. Obviously, if a family has a specific financial challenge that constrains its giving, there’s nothing a charity can do about that. 

However, consider the next three most common reasons: “No connection to an organization” (21.9%), “Do not want to give to charity” (20.8%), and “Was not asked to give” (19.8%). Each of these reasons why wealthy families didn’t donate is the fault of those of us who work in the charitable sector. No connection? We failed to engage. Do not want to give? We failed to inspire. Never asked? We failed to respectfully ask.  

This longitudinal study provides invaluable insights on the giving patterns of affluent families, but ultimately it is incumbent on those of us who work and volunteer for charities to engage, inspire and ask people to give back to the Door County community we all love.

This article, written by Bret Bicoy, President and CEO of the Door County Community Foundation, originally appeared in the Peninsula Pulse.

Take Advantage of These Expiring Charitable Deductions

In my last column, I wrote about the enormous tax advantages of placing highly appreciated stock in a donor-advised fund at your local community foundation, particularly when “bunching” several years of tax deductions into a single year. In the column titled “Maximizing Your Charitable Deduction,” I noted that this has long been a highly effective way to avoid capital-gains taxes and reduce income taxes, thereby maximizing your ability to give back to the community. 

Thankfully, this giving strategy will be around for the foreseeable future, but there are several short-term changes to charitable tax law that are expiring Dec. 31. You’ll need to act fast to take advantage of them.

Let me begin with one caveat. I am neither an attorney nor an accountant, which is something I lament every time my children’s college tuition bills come due. Please check with your own personal wealth adviser to understand how these general strategies will affect your specific tax situation.

When Congress passed the Taxpayer Certainty and Disaster Tax Relief Act in 2020, it temporarily extended several changes in tax law that were originally enacted during the early days of the pandemic through the Coronavirus Aid, Relief and Economic Security (CARES) Act. The IRS recently issued guidance (IR-2021-190) reminding taxpayers that they have until Dec. 31, 2021, to take advantage of these giving strategies.  

Charitable Deduction in 2021 for Non-Itemizers

Contributions that you make to charity are normally reported to the IRS on your 1040 Schedule A, the form used to itemize deductions. The standard deduction for the average taxpayer is $12,550 for individuals and $25,100 for married couples. The overwhelming majority of folks don’t have nearly enough deductions to exceed these levels, so nearly nine out of every 10 taxpayers claim the standard deduction instead. In practical terms, this means that during a typical year, almost 90% of us receive absolutely no tax benefit at all for the charitable gifts we so generously make.  

However, through the end of 2021, there is a special deduction available for individuals who do not itemize their taxes. 

“Ordinarily, individuals who elect to take the standard deduction cannot claim a deduction for their charitable contributions,” according to the IRS. “The law now permits these individuals to claim a limited deduction on their 2021 federal income-tax returns for cash contributions.” 

Through the end of this year, individuals can claim a deduction of up to $300 for most cash contributions they make to charity, and married couples filing jointly can claim a maximum deduction of $600 without having to file a Schedule A to itemize their deductions.

Temporary 100% Limit on Contributions for Itemizers

For the 10% of folks who itemize their deductions during a typical year regardless, Congress has offered a temporary benefit as well. 

The charitable gifts that itemizers can deduct on their taxes is normally capped as a percentage of their adjusted gross income. The specific limit can range from 20% to 60%, depending on the type of asset and the kind of charity receiving the gift. Regardless, the IRS says that the “law now permits electing individuals to apply an increased limit, up to 100% of their adjusted gross income, for qualified contributions made during calendar year 2021.”  

Although cash contributions to most charitable organizations qualify for the temporary 100% limit, the IRS says it does not apply to donations to private foundations, supporting organizations, donor-advised funds and most charitable remainder trusts.

Corporate Limit Temporarily Raised to 25%

During a normal year, the maximum allowable deduction that a corporation can claim for gifts to charity is capped at 10% of the company’s taxable income. Congress has temporarily raised that limit to 25% of corporate taxable income for charitable contributions made in 2021. 

The IRS reminds us that companies should be aware that the increased corporate limit applies to C corporations and that the tax filer must elect the increased limit on a contribution-by-contribution basis.

Increased 2021 Business Limits on Donated Food

Businesses that donate food inventory for the “care of the ill, needy and infants” may also qualify for increased limits on those in-kind contributions. The IRS announced that for “[qualified food inventory] contributions made in 2021, the limit for these contribution deductions is increased from 15% to 25% [of the business’s taxable income].” 

The increased limit of 25% specifically applies to C corporations. The IRS says that sole proprietorships, partnerships and S corporations will generally qualify for a higher limit, but the amount will vary based on other factors.

This article which was written by Bret Bicoy, President and CEO of the Door County Community Foundation, originally appeared in the Peninsula Pulse.

Maximizing Your Charitable Deduction

The S&P 500 has hit a new all-time high more than 50 times this year.  The good news is that there is a way for you to avoid some capital-gains taxes, earn a substantial tax deduction and do a tremendous amount of good for the community you love: Consider using some of your highly appreciated stock to “bunch” several years’ worth of charitable gifts through a Donor Advised Fund at your local community foundation.

Let’s look at these pieces individually before seeing how they can work well together for your tax benefit.

First, when you donate publicly traded stock to a 501(c)(3) public charity, you generally avoid the capital-gains taxes that you would have owed Uncle Sam, and the charity doesn’t pay them either. Almost like magic, those taxes disappear, thereby allowing the entire value of your donated stock to support the charities you love.  

Further, as the donor, you can normally claim a charitable tax deduction of the fair market value of the stock. That’s why donating highly appreciated stock is one of the most tax-efficient ways to give. You get the double benefit of avoiding capital-gains taxes and earning a tax deduction.

Second, “bunching” is a tax-planning tool in which you take the standard deduction during most years and bunch all of your deductions into a single year during which you claim a substantial itemized deduction. 

People might bunch two years’ worth of property taxes (paying in January and December of the same year), medical expenses for procedures that are not time-sensitive, or multiple years’ worth of charitable gifts into a single tax year. For those who have a substantial number of deductions but still fall short of the level that justifies itemizing them on their taxes, bunching deductions into a single tax year can result in enormous tax savings.

Third, a Donor Advised Fund is similar to a private foundation but without the legal, accounting and administrative costs that come with operating a corporate foundation. Community foundations invented Donor Advised Funds as a simpler, cheaper and more tax-efficient alternative. 

For example, let’s say you create the John and Jane Smith Charitable Fund at your local community foundation. Donations into your fund are typically tax-deductible to you as charitable gifts. Then you use your fund to make distributions to the charities you care about. 

There are for-profit financial-services firms that offer Donor Advised Funds, but when you create one at your local community foundation, you have the benefit of working face to face with local nonprofit professionals who serve as your personal foundation staff.

Each of these tax-planning tools works just fine independently, but when you use them all in concert, you dramatically increase both the value of your charitable gift and the tax deductions you can claim.

For instance, let’s imagine that John and Jane Smith normally donate $20,000 to charity annually and have few other tax-deductible expenses. Consequently, they claim the standard deduction of $24,800. In practical terms, this means that the Smiths get absolutely no tax benefit for their $20,000 of charitable giving!  

But what if the Smiths create the John and Jane Smith Donor Advised Fund at their local community foundation? They bunch the next five years’ worth of their charitable giving into this tax year, thereby allowing them to claim a whopping $100,000 itemized deduction in 2021 (five years x $20,000 in donations per year). 

They also very wisely make that charitable gift using $100,000 worth of stock that has appreciated significantly, which enables them to avoid capital-gains taxes while still claiming an itemized deduction of the fair market value of their $100,000 stock gift during this tax year. 

Then, during each of the next four years, the Smiths will claim the standard deduction of $24,800 (adjusted annually, of course). In other words, they will have avoided capital-gains taxes and earned about $75,000 in additional tax deductions over five years using this simple strategy.

Finally, the Smiths will distribute $20,000 every year from their Donor Advised Fund so they can still support the charities they love at the same level they always had.

Goodness knows I’m not an accountant, so you should seek professional counsel to ensure that these tools are right for your particular tax situation. But for many people, bunching multiple years’ worth of charitable gifts by donating highly appreciated stock to a Donor Advised Fund at a local community foundation is an incredibly tax-efficient way to give back.

This article, written by President and CEO of the Door County Community Foundation Bret Bicoy, originally appeared in the Peninsula Pulse.

Why I Choose to Love the Granary

By Bret Bicoy, Peninsula Pulse – August 6th, 2021

For a long time, I couldn’t get excited about the Teweles and Brandeis granary in Sturgeon Bay. A few years ago, many people I admire were vehement about the need to save this 120-year-old structure from destruction, yet others I respect were equally certain that it has no place in our future. Frankly, I just didn’t have strong feelings either way. The granary simply wasn’t a part of what I love about Door County.

When I reflect upon what I treasure about life on this peninsula, I think of Door County’s natural beauty and performing arts. Door County is an uncommon combination of environmental and cultural treasures that is the envy of many cities, yet this treasure trove is situated in our small towns, where neighbors still know each other’s names. It’s what I love most about this place.

I was never opposed to saving the granary; it just wasn’t very important to me.

But I work for the Door County Community Foundation, and preserving the granary is extremely important to several of our donor families. Ultimately, the Community Foundation’s board of directors agreed and unanimously voted to support the effort to preserve the granary.  Regardless of whether I was excited, it became my responsibility to help make the dream of restoring and rejuvenating the granary a reality. And I can remember the precise moment when my entire perspective on this project changed. 

It was the morning when the granary was being moved across the bridge, back to its original location. I was standing inside the fenced area, watching the building movers do their job, when I glanced over my shoulder. Standing against the fence looking in, almost like smiling little kids watching their first real baseball game, were several members of the Northeast Wisconsin Antique Power Association.

Their charity is commonly referred to as NEWAPA, but you likely know it as the group that organizes the Valmy Thresheree. This massive, three-day event is put on by Door County’s farm families to celebrate the agricultural heritage of our community. It includes an antique tractor pull, barn dance, parade of antique machines, chainsaw competition and even a polka mass. During this year’s event, to be held Aug. 20-22, perhaps as many as 10,000 people will visit the 40 acres of the Valmy Thresheree to celebrate the history of farm life in Door County.  

For NEWAPA members – several of whom were standing at the fence that morning – the granary is an important part of the past.

Don Rudolph, one of NEWAPA’s officers, later told me that his grandfather, Julius Karl Rudolph, moved in 1899 from the German Settlement in Liberty Grove to the better farmland of Sevastopol and hauled countless horse-drawn wagons filled with grain to the granary in his day. Don’s father, Edgar, continued the tradition, and Don himself did business at the granary location until it finally closed.

That morning at the fence, I recall encountering one much older man who was crying. He said it gave him great comfort to know that the granary that had towered over our community long before he was born will still be looking over all of us long after he is gone.

Although the granary isn’t part of my Door County experience, it is central to the experience of many families that called Door County home generations before my wife and I settled here.

“The granary is one of the last vestiges of a once-vibrant agrarian business community that included sawmills, flouring mills, grain elevators, pea canneries, pea warehouses, cherry- and apple-processing facilities, an ice cream factory, implement dealers and other supporting businesses,” Don Rudolph said. “As one of the last standing ag-related buildings, it deserves to be preserved to honor Door County’s agricultural heritage.”

The Valmy Thresheree property is a little more than 10 minutes away from the shops of downtown Egg Harbor. For generations, the tourism-based part of our economy has lived right next door to our farm families, yet sometimes it feels nowadays like these neighbors don’t talk to each other very much anymore. Yet we are still neighbors.

The granary is important to me not because I have some fondness for the building, but rather, because it is important to many families that settled and built the county that my family now enjoys. Although I might be ambivalent about a thing, I choose to care about that thing precisely because it’s important to my neighbor. It’s what good neighbors are supposed to do. This is what it means to be a community. 

COMMUNITY INVITED TO RECEPTION FOR ARTISTS ANNE EGAN, DEBORAH ROSENTHAL, & NANCY SARGENT

The community is invited to attend a reception on Friday, July 16^th from 4:30 p.m. to 6 p.m., at the Door County Community Foundation. The reception celebrates the Lobby Gallery Summer Exhibition featuring works by Anne Egan, Deborah Rosenthal, and Nancy Sargent. The Community Foundation is located at 222 N 3^rd Avenue in Downtown Sturgeon Bay. Refreshments will be served by Thyme Catering.

Anne Egan studied art at St. Norbert College but did not begin painting until moving to Door County in 1988 when she took many classes at the Peninsula School of Art. Her work was represented by Woodwalk Gallery for fifteen years and can be found in many private collections as well as several public venues. After a 5-year hiatus, Anne had returned to painting and hopes to never again stop. “My paintings can begin anywhere—from inspiration arising from natural world, manufactured forms, or the human form,” said Egan.

After retiring in 2018 from a three-decade career as a museum curator in several small museums, including 24 years as Curator of Exhibitions and Collections at the Miller Art Museum in Sturgeon Bay, Deborah Rosenthal has recently been focusing more on her studio training in painting, drawing and printmaking. “Drawing is my primary interest along with color experimentation influenced by Fauve artists’ exuberant color practice,” said Rosenthal.

Nancy Kinsey Sargent was born and raised in Fish Creek.  She graduated from Gibraltar High School at a time when there was no art program offered. Nancy attended Cardinal Stritch College in Milwaukee.  Graduating with a B.A. degree in education with a concentration in art, she returned to Fish Creek to teach elementary art in the Gibraltar School System. Marriage moved Nancy away from Door County, but in 1997, Nancy and her husband John retired to Fish Creek. Nancy exhibited her first collection of work as an emerging artist in 2001 at the Snow Star Gallery Ltd. in Fish Creek. “My love of color, pattern, rhythm, and symbols takes on a life of its own becoming more about the act of painting than the images themselves,” said Sargent.

Each season, different Door County artists will be invited to exhibit their work at the Door County Community Foundation’s Lobby Gallery. The Gallery is normally open to the public during the Community Foundation’s regular hours of 8:00 a.m. to 4:30 p.m., Monday through Friday.

The Door County Community Foundation, Inc. is a collection of separate charitable funds set up by individuals, families, non-profit organizations, private foundations and businesses that are managed, invested and disbursed for the current and future good of Door County. The Community Foundation was launched in 1999, currently administers more than $33 million in assets, and distributes more than $5 million to charities in Door County every year.

Winding Down the Emergency Response Fund

Now that the vaccinated among us have begun to remove our masks, it’s time to update the community as we enter the final phase of the Door County Emergency Response Fund.  As you may recall, The Board of Directors of the Door County Community Foundation activated the Emergency Response on March 19, 2020.  Working in partnership with United Way, this Fund was our community’s coordinated philanthropic response to COVID-19 and resulting economic crisis. 

The initial contributions to the Emergency Response Fund were entirely local.  It began with a gift from the Community Foundation itself along with local year ‘round residents whose jobs remained secure.  Then donations started to arrive from across the nation as seasonal residents sent gifts to help those who were unemployed in the place they love.  Nearly 70% of the $1.2 million donated to the Emergency Response Fund and other response efforts at the Community Foundation have come from people who live in Door County only part of the year.

While $1.2 million is a modest number in the grand scheme of philanthropy, on a per capita basis, it appears that the generosity of the people who love Door County has made ours the most generous response effort in Wisconsin. 

A joint Community Foundation-United Way Task Force established three priorities for the Emergency Response Fund.  First, our goal was to provide support for organizations offering immediate relief and assistance to people who were struggling during the stay-at-home order.  That work ended in June of 2020. 

The second priority was, and continues to be, to provide support for organizations helping people in who continue to struggle as the national recession threatens their family’s economic security.  Remember, during the summer of 2020, unemployment in Door County was double what it was during the summer of 2019. 

As challenging as it was for working families last summer, our single greatest concern was the looming 2020-2021 off-season.  For those at the bottom rung of the economic ladder, jobs become scarce during the cold months.  If a family doesn’t make their usual summer wages during the busy season, their ability to survive through the winter would be severely compromised.  Hence, the Community Foundation and the United Way placed great focus on creating initiatives to address two very basic needs:  food and shelter. 

For food, we brought the 8 food pantries together to form the Door County Food Pantry Coalition (www.FeedDoorCounty.org).  For shelter, we created a new Door County Rental Assistance Program (www.RentReliefDoorCounty.org) and internally prepared ourselves to make a significant investment in rent relief.  Thus we launched these new programs and waited for the substantial demand on our resources to begin. 

While the economic crisis continued during the off-season – people were struggling mightily –we didn’t anticipate the massive federal response.  Instead of Door County having to bear the burden alone, federal and state money became the primary sources of rental assistance.  As a result, instead of being the sole funding source, the Emergency Response Fund was primarily used to fill the gaps when a particular family didn’t meet the rigid federal and state criteria.  Functionally, this meant that the Emergency Response Fund never needed to invest more than $70,000 into rent relief when we anticipated spending several times more.

The shifting of the cost of rental assistance to government funding has left us the resources to attend to the third priority of the Emergency Response Fund: providing support for the non-profit organizations themselves, whose long-term viability is threatened by the economic crisis in Door County.

“Our first two priorities were focused on helping people who are struggling during this health and economic crisis,” says my colleague, Amy Kohnle, Executive Director of the United Way.  “While that work will continue, our third priority is to look at the health of the non-profit organizations themselves.”

Arts organizations and environmental groups are major economic engines for Door County, bringing tourists here and creating jobs for our residents.  Historical societies and other kinds of charities are important to our quality of life.  While the primary focus of the Emergency Response Fund remains helping those families who are facing tough times, we also want to ensure that Door County’s most important charitable organizations survive this crisis as well.

If you’re an arts organization, environmental group, historical society, or other kind of non-profit that incurred significant expenses related to COVID-19, you are invited to join human service charities in seeking assistance from the Emergency Response Fund.  To apply, or for a complete listing of grants awarded, visit www.RespondDoorCounty.org.

For Many Charities, the Economic Crisis Continues

The Door is open! From the cars lined up on the highway to the people lined up at Al Johnson’s, it’s clear that Door County has reopened after more than a year of this horrible pandemic. The advance-reservation rates reported by our lodging establishments indicate that this may be the busiest season in Door County ever.

Yet as we look around at all the people who are enjoying their stay in this wonderful place, it’s easy to forget that some of our greatest community treasures were hit hard by this global health and economic crisis and are still struggling, even now.

“COVID nearly destroyed our organization,” said Amy Frank, managing director of Third Avenue Playhouse (TAP). “We haven’t sold a ticket in over 15 months. In March of 2020, TAP was in the final week of rehearsals for the first show of the season. The majority of our production expenses – construction of the set and costumes, salaries for the rehearsal period, promotional and advertising costs, and royalty fees – are all incurred prior to the first performance. Closing the theater right before opening night immediately put TAP in the red, and we’ve been playing catch-up ever since.”

TAP’s story is far too common on our peninsula. So many arts and cultural organizations that are both essential to our quality of life and critical to our tourist economy faced similar stories of financial carnage last season.

“COVID devastated our budget last year,” said Mona Christensen, executive director of the Birch Creek Music Performance Center. “We not only lost all of our tuition revenue from our academy, but ticket sales from our concerts, advertising and sponsorships as well.”

“In 2020, our major conferences were canceled,” said Lauren Ward, managing director of Write On, Door County, “leaving us, like many artistic nonprofits, searching for ways to stay afloat and continue furthering our mission.”

These cultural treasures aren’t merely nonprofit organizations. They also employ real people who bore the brunt of this economic devastation.

“We had to cancel contracts for 63 company members,” said Dave Maier, managing director of Northern Sky Theater. “That’s more than $500,000 in lost wages to our performers and production staff.”

And this revenue loss wasn’t limited just to arts and cultural charities.

“We closed the Nature Center and canceled programs and events, including the Festival of Nature for the first time in 18 years,” said Andy Gill, executive director of The Ridges Sanctuary. “We count on those visitors to pay trail fees, make donations, shop in our Nature Store, sign up for memberships and take advantage of our programs. They are critical to our earned-income model.”

Environmental charities faced a significant added challenge during the pandemic because unlike arts groups whose stages went dark and buildings were closed, environmental organizations experienced a surge in the use of their facilities as the desire to be outdoors created unprecedented demand. Unfortunately, the increased use of trails and outdoor spaces translated into significantly higher maintenance costs without a commensurate increase in revenue.

“Demand for our programs is at an all-time high, but the decline in income has made it uniquely challenging to meet those demands,” Gill said.

It’s easy to look around at the incredible number of tourists we’re seeing this season and conclude that the economic crisis for these community treasures must be over. Unfortunately, that just isn’t the reality. Whether the source is guidance from public-health officials, restrictions from governing associations or labor contracts, or simply following best practices in a given field, ongoing COVID-19 restrictions are continuing to limit the ability of our charitable organizations to take advantage of these massive visitor numbers.

“This year, because of COVID protocols for music schools, summer camps and vaccinated/unvaccinated youth, we are operating at half capacity for our academy,” Christensen said. 

Similarly, Maier noted, “We already know that 2021 will also be a compromised season due to reduced audience capacity.”

That’s where you can help. The next time you walk the trails at Crossroads at Big Creek, be sure to leave an extra charitable gift behind. If you enjoyed a Midsummer’s Music concert, put something in a donation envelope before you leave for the evening. Charitable organizations such as these are essential to our quality of life and a major economic engine for our visitor industry.

“The ongoing donations from our friends and supporters are not only paying our bills, they are feeding our spirits,” Frank said. 

This season, make an extra gift to the charities you love the most.

This article, written by Door County Community Foundation President and CEO Bret Bicoy, originally appeared in the Peninsula Pulse.

Giving Is a Key to Success

As the fifth of our six children moves into her first apartment this weekend, I cannot help but pause for a moment to celebrate the giving person she has become. This daughter spends hours dreaming up wonderfully imaginative birthday celebrations for others because she knows how much it will make them smile. When she heard that a person she knew couldn’t afford a Christmas tree one holiday season, she left a tree anonymously outside her friend’s door. This young woman is filled with a generous spirit, and as it is with all her brothers and sisters, her mother and I are both so pleased about the adult she has become.

Fostering a generous spirit in children is something many of us do simply because generosity is a fundamental human value. Interestingly, research has shown that a giving attitude also has a very practical value because it helps to further a person’s career. There is abundant evidence that being a giver is a key component of many people’s professional success.

Adam Grant, a professor of management and psychology at the Wharton School at the University of Pennsylvania, studied how people relate to each other and summarized his findings in his book Give and Take: Why Helping Others Drives Our Success. According to Grant, our interactions with other people divide us into three categories: takers, givers and matchers.

Takers are easy to understand. They want to get more than they give.

“Takers believe the world is a competitive, dog-eat-dog place,” writes Grant, so “they tilt reciprocity in their own favor, putting their own interests ahead of others’ needs.”

Givers do just the opposite: They tilt reciprocity in the other direction.

“Whereas takers tend to be self-focused, evaluating what other people can offer them, givers are other-focused, paying more attention to what other people need from them.”

Yet most of us are neither. Most people approach others as a matcher. When we act as matchers, we’re “striving to preserve an equal balance of giving and getting.” 

Grant writes, “If you’re a matcher, you believe in tit for tat, and your relationships are governed by an even exchange of favors.”

Although no one is entirely one type, Grant notes that there is ample evidence to demonstrate that most people develop a “primary reciprocity style, which captures how they approach most of the people most of the time. And this primary style can play as much of a role in our success as hard work, talent and luck.”

It’s easy to stereotype givers as “chumps and doormats.” Indeed, Grant finds that givers occasionally drop to the bottom of the ladder of professional success, and they can be at a disadvantage if they “make others better off but sacrifice their own success in the process.” Yet when you seek out those who have reached the highest rungs of the success ladder, you are most likely to encounter givers.

“When takers win, there’s usually someone else who loses,” Grant writes. “Givers succeed in a way that creates a ripple effect, enhancing the success of people around them.” He says that “there’s something distinctive that happens when givers succeed: It spreads and cascades.”

The key to a givers’ success is grounded in what Grant (and other researchers) commonly refer to as the “strength of weak ties.” Strong ties are the people we trust most, such as our family members, close friends and colleagues. Weak ties are those people we only know casually. 

Unlike matchers, who give only when they get – and far different than takers, who insist on taking what they want – givers share of themselves generously without any expectation of compensation. As a result, over the course of a lifetime, they develop extraordinarily rich networks of acquaintances whose lives are better because of their interaction with the giver. It’s the strength of these weak ties that is the secret to the giver’s success.

When a giver encounters an obstacle, a distant acquaintance often arrives to offer a helping hand. When a giver needs counsel, a casual friend often has knowledge to share. 

“It takes time for givers to build goodwill and trust, but eventually,” writes Grant, “they establish relationships that enhance their success.”

This article was written by Bret Bicoy, the President and CEO of the Door County Community Foundation and originally appeared in the Peninsula Pulse.

An Accounting-Fraud Tool Applied to Nonprofits

Frank Benford was a physicist in General Electric’s research laboratory almost a century ago. During that era, data sets were typed or written out by hand. One day, as he was looking through pages and pages filled with numbers, he noticed a fascinating pattern that was consistent across all his voluminous ledgers of work.

First, some background. The “leading digit” of any number is the first digit on the left other than zero. For instance, in the number 8675309, the leading digit is 8, and in the number 42, it’s 4. The numbers 1 through 9 are the nine possible leading digits because 0 is excluded.

People reasonably assume that if you have a page filled with numbers, all of the nine possible leading digits should occur equally, with each one showing up about 11% of the time. However, Benford noticed that in every large list of numbers, the number 1 is by far the most common leading digit. 

What Benford discovered – and what has since been confirmed to be correct – is that about 30% of all the numbers in any large data set will have 1 as the leading digit. The number 2 will be the leading digit about 17% of the time, the number 3 about 12% of the time and so forth, with each successive number being less common until you get to 9: by far the least common leading digit, appearing less than 5% of the time.

In 1938, Benford published the Law of Anomalous Numbers, which we now call Benford’s Law. It’s a distribution pattern of leading digits that you expect to see in every large data set of numbers that haven’t been manipulated by a human. That’s why Benford’s Law is such an exceptional tool in rooting out fraud.

Today, forensic accountants scan in the tax returns, financial statements and other transactional data of a business – basically pages with lots of numbers on them – and a computer checks to see whether the leading digits of all those numbers are consistent with the pattern of Benford’s Law. If these “naturally occurring” numbers haven’t been manipulated or fabricated, they will normally fit the pattern. If they don’t, then it’s reasonable to suspect that something fishy may be going on and a deeper investigation is warranted.  

In their recent paper “Abiding by the Law? Using Benford’s Law to Examine the Accuracy of Nonprofit Financial Reports,” academic researchers Heng Qu, Richard Steinberg and Ronelle Burger published their findings regarding the first application of Benford’s Law to the tax returns and financial statements of an enormous sampling of charities to see whether any trends were apparent.

The good news is that the financial statements of the nonprofit field as a whole conform to Benford’s Law. In other words, as a group, the numbers of the whole universe of charities do not raise any suspicion. The bad news comes when you look at specific subsets of the data. 

“We find close conformity with Benford’s Law for the whole sample, but at the individual organization level, 34% of organizations do not conform,” the researchers wrote.

What immediately jumps out when looking at the research is that charitable work benefits from the involvement of paid professionals.  Charities with a paid, professional staff have financial statements that are far more likely to conform to Benford’s Law than those that operate only with volunteers. 

“Organizations with paid directors/officers are significantly more conformant by all tests,” the researchers concluded. Further, volunteer-run organizations that pay professional accountants to audit their statements are also far more likely to conform to Benford’s Law. Thus, it behooves charities that deal with significant amounts of money to hire a professional staff person or pay an outside accountant to ensure that funds are being properly handled and protected.

The other significant conclusion to draw is that charities need to be held accountable by an entity that knows how to evaluate their work. 

The researchers wrote, “Organizations that receive government grants and those receiving indirect support [such as grants from a community foundation] are significantly more conformant by all tests than those that do not receive these funds.” 

Everyone performs better when they are accountable to someone for their performance. Charities that receive support from government agencies and grant-making foundations – and are therefore held accountable by them – are far less likely to have nonconforming financial statements that might raise suspicion.

This article, written by Bret Bicoy, President & CEO of the Door County Community Foundation, originally appeared in the Peninsula Pulse.