By Jake Blumberg, Nonoko Sato and Kate Barr
To say the past three years have been difficult for the Minnesota nonprofit sector, and every Minnesotan, would be an understatement. In times of crisis, nonprofits are often on the front lines helping our neighbors in need. And when the crises continue year after year, nonprofits continue to work to provide Minnesotans with the food, housing and medications they need, while simultaneously ensuring the most vulnerable are protected.
Nonprofits not only provide these essential community services, they also employ 14% of the state’s workforce and help to drive their local economies.
As leaders in the nonprofit and philanthropic sector, we are grateful we could step up for our communities when they needed us — and we want to continue to be there for our neighbors. Years of pandemic response have left organizations overextended and under-resourced as needs increase. Inflation aggravates this already difficult situation, resulting in a nationwide dip in individual giving compared with 2020 and 2021.
Additionally, a number of recent incidents, most notably fraudulent activity discovered in the organization Feeding Our Future, have raised public concerns regarding the integrity of the nonprofit sector. Together, we offer a set of perspectives as we approach a critical moment in the calendar for our sector, the year-end giving season:
First, it is important to note that the set of circumstances represented by Feeding Our Future and its affiliates, while disturbing and worthy of thorough investigation, is an anomaly in the world of Minnesota state grants and nonprofits, which overall are well documented to be scrupulous in their performance and use of funds. (While federal exemptions eased the typically stringent rules and oversight during the height of the pandemic, those standards have since returned to pre-pandemic levels in Minnesota.)
In fact, the nonprofit sector is uniquely accountable and transparent in its financial activities and is required to comply with the numerous regulations and agencies that guarantee oversight, accountability and transparency (such as publicly available annual tax filings through the Minnesota Attorney General’s Office and the IRS, functioning boards of directors, etc.). Feeding Our Future lacked in all these areas of compliance to operate as a charity in Minnesota.
Second, the fraud at Feeding Our Future was caught, is being investigated, and those involved are being brought to justice. We appreciate the intentional and meticulous work the Minnesota Department of Education, the Minnesota Attorney General’s Office, the FBI and the U.S. Department of Justice have done to investigate and charge wrongdoing tied to Feeding Our Future. Their efforts ensure that the good work done daily by thousands of Minnesota nonprofits, as well as the trusting bonds they share with their donors, volunteers and communities, remain strong and protected. It’s confirmation that, when needed, the systems that regulate our sector are working as intended.
Last, the vast majority of nonprofits do not receive government funding and depend on trust and support of the public. Few receive the type of government funding collected by Feeding Our Future. Instead, they depend on the generosity of donors like you. Dedicated staff members and volunteers partner with boards of directors to ensure that donations are deployed in the community in line with their missions and legal status as 501(c)(3) nonprofit entities. Thousands of nonprofits do this every day while remaining in good standing with regulatory agencies.
We are grateful for the proven generosity of Minnesotans — and we need your continued support now more than ever. Together, we can ensure that nonprofits have access to financial support, diverse volunteer and board representation, tools and resources for effective community organizing, and a seat at the table as issues and needs are explored throughout Minnesota and beyond.
Please join us in ensuring that organizations that function with integrity can continue meeting their mission to serve all Minnesotans.
Jake Blumberg is executive director of GiveMN. Nonoko Sato is executive director of the Minnesota Council of Nonprofits. Kate Barr is president and CEO of Propel Nonprofits. This commentary was also submitted on behalf of the following 13 additional Minnesota nonprofit leaders: Nasibu Sareva, CEO, African Development Center; Kris Kewitsch, executive director, Charities Review Council; May yer Thao, president and CEO, Hmong American Partnership; Matt Varilek, president, Initiative Foundation; Henry Jimenez, executive director, Latino Economic Development Corporation; Elena Gaarder, CEO, Metropolitan Consortium of Community Developers; R.T. Rybak, president and CEO, Minneapolis Foundation; Renay Dossman, president, Neighborhood Development Center; Karen White, president and CEO, Northwest Minnesota Foundation; Eric Jolly, president and CEO; Saint Paul and Minnesota Foundation; Diana Anderson, president and CEO, Southwest Initiative Foundation; Anna M. Wasescha, president, West Central Initiative; Marcus Pope, president, Youthprise; Dr. Gene Gelgelu, founder, president and CEO, African Economic Development Solutions/Little Africa.