When we launched PittsburghGives and the Day of Giving five years ago, none of us envisioned the phenomenon it would become. The program has grown every year since, and all of us involved have been gratified by what our community has accomplished together. The question now is: Where do we go from here?

The question arises because the program has reached an inflection point. Its matching pool cannot sustain the sort of growth we have been experiencing. From barely a thousand donors contributing in our first year, Day of Giving grew to almost 18,000 donors last year, and that rate of increase is likely to continue. Unfortunately, the resources available for our matching pool are limited, and in 2012 the “match” for every dollar donated dropped to a dime. As the match continues to decline in the face of rising demand, it begs the question of how long the program can continue and still be worthwhile.

In discussing this issue with The Pittsburgh Foundation’s Board and staff in recent months, along with nonprofit leaders in focus groups and individual conversations, we have kept returning to the basics. Why did we launch this program in the first place? Have we achieved what we set out to accomplish? And if so, is it time to move on or is there still more to be done?

The Foundation had three explicit goals in launching the Day of Giving.  First, we wanted to create a transparent, regional “one-stop shop” for information on area organizations and agencies. The result is PittsburghGives, which today houses information on over 700 of our region’s nonprofits and is one of our nation’s richest nonprofit databases.

Second, we hoped to increase the capacity of our community’s nonprofits to take advantage of new technology and social media to broaden their support among individual donors and expand their bases of charitable support. Thanks to Day of Giving, thousands of new donor relationships have been established, and the capacity of nonprofits to build on those relationships has increased dramatically.

Third, we wanted to make more people in our community aware of The Pittsburgh Foundation and the work we do. As our region’s major community foundation, we strive to be a vocal advocate for moving our community forward and support our nonprofits in operating at the forefront of trends in philanthropy, such as the rise of on-line giving and increasing demand for transparency. The Day of Giving is a clear demonstration of that and our model has become a benchmark for communities across the country.

In reflecting on these outcomes and the input we have received, we have decided to continue with the program for two more years but to begin to modify it slowly now while signaling that more significant changes lie ahead. Specifically, here is what we are planning:

1. On behalf of our Board, I am pleased to advise that our Day of Giving this year, set for October 3, 2013, will provide a matching pool of approximately $750,000 for Allegheny County and $100,000 for Westmoreland.
2. To ensure a robust match percentage for participating organizations, and to honor the program’s original intent, only the first $1,000 that any individual gives per organization will be eligible to participate in the match pool. Gifts over $1,000 will obviously be allowed but only the first $1,000 per individual per organization will share in the match. This compares to last year’s cap of $10,000.
3. We will host another “regular” Day of Giving in 2014, most likely to coincide with a nationwide program currently being planned for community foundations across the country.  This National Day of Giving, very much built on Pittsburgh’s model, has been tentatively scheduled by its organizers for sometime in the spring of 2014. We will share further details as they develop.
4. Our Day of Giving program will change in 2015. We are still figuring out how, but the important message for nonprofits now is that they refrain from building an expectation for Day of Giving into their annual budgets for 2015 and beyond.
5. We will be simplifying the profiles that nonprofits must complete on Pittsburgh Gives to be eligible for Day of Giving in response to comment from local charitable organizations. We are working with our technology partner to shorten profiles and simplify the story that nonprofits are trying to tell.

We are grateful to everyone in our community who has helped to make the Day of Giving the success that it undoubtedly is. Please be assured that going forwards we are focused on how best to preserve and further develop this program as a valued community asset.

There’s a somewhat cynical assessment of America’s democratic election system that suggests we get the government we deserve. It speaks more to the all-too-frequent bouts of apathy on polling days than it does about the skills, vision and competency or otherwise of our election candidates.

But against the background of the on-going Federal investigation into Pittsburgh’s police operations, and the withdrawal of Luke Ravenstahl, the current incumbent, from our city’s mayoral elections, perhaps now is the time to be asking ourselves: What kind of future leadership do we want for our community?

History tells us that to envision the future, it helps to examine the past and Pittsburgh’s enormous advancements in recent years are unequivocal. Our city’s riverfronts are in the advanced stages of radical transformation, we are a recognized and respected leader of urban design and green building development, and we are at the forefront nationally of addressing urgent reform issues within our public school system.

We have a Cultural District that is second to none and less than two years ago, we were named America’s most liveable city. There is solid ground for optimism with an array of Downtown development projects on the drawing board and continued revitalization programs in our city neighborhoods.

But when the time comes to choose our next mayor – and The Pittsburgh Foundation is without fear or favor on whoever he or she may be – let us expect our new leader to embrace our city’s accomplishments while taking a bold and visionary stand in helping to shape Pittsburgh’s future.

Let us expect Pittsburgh’s civic leadership to nurture an atmosphere where business can thrive, where our hard-won reputation is advanced and where the vulnerable, the underprivileged and the disadvantaged are protected. Let us expect our leadership to work across all areas, including the corporate, nonprofit, academic and public sectors, in effective and inspiring partnerships that will foster innovation, entrepreneurship and creative solutions.

And let us elect a leader who will focus on Pittsburgh’s dominant critical issues, including those around race and poverty.

We should set the highest expectations for our next leader, regardless of who is elected Mayor in November. And regardless of who is elected, let us all pledge to play our part in striving to turn the big dreams we have for our community into reality.

Congressman Camp, Ranking Member Levin, and other Committee members, thank you for this opportunity to provide written testimony on the deduction for charitable contributions as part of the Committee’s work on comprehensive tax reform.  Especially, I would like to recognize members Jim Gerlach, Mike Kelly, and Allyson Schwartz, from my home state of Pennsylvania.

For the past five years I have served as President and CEO of The Pittsburgh Foundation, the 13th largest community foundation in the United States.  During this time, we have experienced consistent growth in terms of annual fundraising and currently The Pittsburgh Foundation’s assets are approximately $900 million.  This growth would not have been possible without the generosity and commitment of our donors and in 2012 alone, our donors gave $12.7 million from their funds at the Foundation to support the vital work of over 1,100 nonprofit organizations throughout the Pittsburgh region.  This was in addition to the $44 million in grants provided by The Pittsburgh Foundation to strengthen charitable programs in our local community to improve health care services, safeguard and develop educational opportunities for our children, enhance the arts and cultural activities, and provide human services programs to support the region’s most vulnerable citizens as well as addressing key issues concerning the well-being of our environment and economic development.

I highlight this information at the start of my testimony because unlike private or corporate foundations, community foundations serve a unique and significant role in philanthropy, a role that would be endangered, I believe irrevocably, by any reduction or elimination of the charitable tax deduction, which by its very creation was designed to help facilitate community-based charitable giving that is so well represented by The Pittsburgh Foundation.

Beyond the technical definition as tax-exempt public charities, community foundations are a critical tool in promoting self-sufficiency among nonprofit organizations and our community’s overall health by providing opportunities for donors to participate in place-based initiatives through the creation of funds to meet current and potential needs in perpetuity.

Furthermore, many leading community foundations, like The Pittsburgh Foundation, take on a broader responsibility to encourage and inspire charitable giving among individuals and families in local communities, and to provide professional expertise, guidance and innovative resources that help them to do so.

The community foundation sector in the U.S., collectively with approximately $55.6 billion in assets, advances the philosophy of Pittsburgh’s own Andrew Carnegie, “a person of wealth is an agent of civilization, and philanthropy is a tool for improving civilization while at the same time substituting for radical reforms.”   This philosophy holds true today but will be seriously undermined should individuals feel that they are no longer encouraged to participate in true community-based philanthropy in seeking to make a positive impact in their communities.

Such a level of discouragement would result, I believe, if proposals are successful to amend the current code governing the charitable tax deduction.  Currently the code serves not only as an invaluable monetary incentive, but also as tangible evidence that philanthropic good work is recognized, valued and supported.

The charitable tax deduction is vitally important for community foundations to deliver their missions, especially with the growth of donor-advised funds that allow donors to be part of the philanthropic process in identifying critical community needs and recommending grantmaking support to charitable programs about which they are especially passionate. The Pittsburgh Foundation’s donors are resolute in their belief that by joining with a community foundation, they benefit greatly from a philanthropic partnership, which in turn benefits our local community.

An example of an initiative led by The Pittsburgh Foundation that leveraged individual giving on behalf of the community is the Neighbor-Aid Fund, which attracted support from many local funding partners as well as public donations.  In response to the 2008 economic crisis this emergency fund was designed to support nonprofit organizations striving to meet increased demand for essential human services, specifically, food, housing, transportation, and utilities.  Over $1 million was distributed to nonprofits providing critical “safety-net” services.

Another example of foundation work that can only be successful if our donors support it via giving is The Pittsburgh Foundation’s Day of Giving.  Launched in 2009, the on-line site’s giving events have so far raised more than $21 million for the region’s nonprofit organizations.  Last year alone, this effort raised a total of $8,540,345, an increase of over 31 percent compared with the previous year.  More importantly, 665 nonprofits received contributions from over 17,000 individual donations.

My foundation has an unwavering commitment to further developing its partnerships with donors as well as collaborative and innovative ventures with funding partners at local and national levels in order to maximize grantmaking impact and philanthropic leadership in our region. Together we have pioneered some major achievements in recent years, including reform initiatives within the Pittsburgh Public Schools, and the launch of the Pittsburgh Promise scholarship program, that provides four-year funding of up to $10,000 per year for city public school students pursuing college and university education.  Like Pittsburgh’s Day of Giving, the Pittsburgh Promise has become an acclaimed model for similar initiatives developed by other foundations across the United States.

Local, state and federal governments are fiscally constrained, severely limiting their ability to mount new programs and even sustain existing ones. This reality combined with increasing demand for assistance from our nonprofit provider community, is further witness that any action that would lead to a reduction or elimination of the charitable tax deduction would have a direct and negative impact on charities and the people they serve.

Thank you for this opportunity to share the important role donors play within the context of a community foundation and I ask that as important tax reform debates continue, the charitable tax deduction be preserved in order to safeguard an essential part of our infrastructure that serves to inspire and enable philanthropy and the great, essential work that it undertakes on behalf of us all.

To members of the Pennsylvania General Assembly:

Pennsylvania’s community foundations are universally dedicated to improving the quality of life in communities around the Commonwealth.  Each year we distribute tens of millions of dollars in grants to organizations addressing a wide range of issues in our state.  By administering funds entrusted to us in exactly the way the donor specified, we have an enormous impact on the places where Pennsylvanians live and work.

Through that work, we collectively support a large number of organizations working to address the problems of rape, domestic violence and child abuse.  None of those organizations have resources adequate to the formidable task they undertake.

We write today, therefore, to ask that you support efforts to direct the expenditure of the fund created as a result of the settlement between Penn State and the NCAA solely within Pennsylvania.  This fund represents a unique opportunity to make a significant investment in the capacity of organizations working to prevent horrific violence—and to ease the suffering of those who experience that violence.

While we express no judgment as to the wisdom of the settlement, it is clear to us that funds generated by Penn State ought to be spent on behalf of Pennsylvanians.   If there was ever an institution built on the generosity and farsightedness of Pennsylvanians, including our donors, it is Penn State.  Penn State itself asserts that it is “an instrumentality of the state.”  As such, it is hard to understand how the residents of our state will benefit from having Pennsylvania’s funds spent in California or New Jersey.

There is clearly a need for these funds here in the Commonwealth.  Moreover these funds were clearly generated (whatever their purported source) for the benefit of the residents of the Commonwealth. Those two reasons should be sufficient for our legislature to assure that any funds generated by this settlement benefit the communities of our Commonwealth.

Grant Oliphant
President
The Pittsburgh Foundation

Kevin K. Murphy
President
Berks County Community Foundation

Michael Batchelor
President
The Erie Community Foundation

R. Andrew Swinney
President
The Philadelphia Foundation

Janice R. Black
President/CEO
The Foundation for Enhancing Communities

Charles M. Barber
President and CEO
The Luzerne Foundation

Eric Dewald
Chief Executive Officer
Central Susquehanna Community Foundation

Karen A. Simmons
President/CEO
Chester County Community Foundation

Al Jones
Executive Director
Centre County Community Foundation

Barbara B. Ernico
President
Adams County Foundation

Samuel Bressi
President & CEO
Lancaster County Community Foundation

Christian Maher
Executive Director
Crawford Heritage Community Foundation

Betsie Trew
President & CEO
Washington County Community Foundation

Trenton E. Moulin
Executive Director
Bridge Builders Community Foundations

Linda L. Goodwin
Executive Director
Bucks County Foundation

Larry Haynes
Executive Director
Community Foundation

Bettie B. Stammerjohn
Executive Director
Community Foundation of Greene County

Living inside the Washington beltway must be a profoundly disorienting experience. Maybe there’s something in the Potomac River, maybe it’s just too much time in the world’s most self-absorbed echo chamber, or maybe it’s just the pressure of too much traffic. Honestly, I don’t know.

But there must be something that explains the recent Washington Post editorial by Fred Hiatt that concludes that the federal income tax deduction for charitable contributions “overwhelmingly… benefits the wealthy.” Mr. Hiatt goes on to opine that “the rest of the country has to make up the gap.”

Huh? Only in the current weird climate of our nation’s capital could anyone conclude that the benefits of the charitable deduction accrue to the people who donate money to charitable causes. And only in D.C. could a newspaper imagine that it’s news that the people who give the money are — sit tight now — people who have money to give.

Since it doesn’t seem obvious to the Post, and growing numbers of others hold the misconception that the charitable deduction only benefits the wealthy, perhaps a little clarity from out here where most of the nation lives would help.

People who donate money to the March of Dimes are encouraged to do so by the charitable income tax deduction (which has existed since 1917). The March of Dimes has had some pretty big success with that money. It funded the research that lead to the Salk vaccine that prevents polio. In 1954, there were about 38,500 new cases of polio reported in the United States. Since 1999, there’s been one case reported. The World Health Organization reports a global drop in new cases of 99 percent since 1988. I’m pretty sure the beneficiaries of the charitable gifts made to the March of Dimes are all the people who didn’t contract polio this year.

There’s a little town north of where I live called Bethel. Sitting at the base of the Appalachian Mountain range, Bethel’s population would be described as somewhere in the working-class to working-poor range. More than 40 percent of the children who go to the elementary school there qualify for free or reduced lunches. There’s not much in Bethel, but they do have a library. It’s only about 1,500 square feet, but it’s packed with children after school and it circulates about 150,000 books a year. For many in the community, it’s also the only place to access the Internet. Last year, the people in Bethel raised more than $40,000 to keep their library open, and I’ll bet some of those donors took the charitable deduction. But the beneficiaries, it seems to me, are the children whose reading levels improved and the people who were able to find critical information about jobs, health care and perhaps even read The Washington Post online.

This list could go on and on. Outside of the Washington D.C. orbit, every town in America, in fact, every American can tell you who benefits from the charitable deduction — or perhaps when they themselves benefited from it.

And anyone with, as my late mother would have said, “the common sense that God gave a goat” can understand that the charitable deduction doesn’t “benefit” the giver. If I have $100 and I keep it, I have $100. If I give that $100 to the local food bank and, if I were entitled to the 35 percent deduction that Mr. Hiatt finds so offensive, I’d still be out $65. The charitable deduction would reduce my cost of giving, but it sure doesn’t make money for me. What that $100 does accomplish, though, is to fill backpacks with food for some of the many children in Reading, Pa., who live in poverty. Those children take the backpacks home each Friday after school, ensuring they have something to eat over the weekend until they come back to school on Monday.

Mr. Hiatt concludes his editorial with a list of some of the choices that Congress will have to make and the comment “You need to keep all of them in mind as you decide how much you want to pay to help renovate that hospital wing with the billionaire’s name above the door.” Out here in Reading, very far from the beltway, we’re all very grateful to Terry McGlinn and his family for donating the money for the McGlinn Family Regional Cancer Center at Reading Hospital. The center is a specially designed facility where all of the specialists who treat cancer are located together, making it easier to create and implement a holistic plan for patient care. Every year, the center treats about 1,600 cancer patients. One year that group included my wife. If you asked my sons who the beneficiaries of the McGlinn’s generosity were, they’ll say “we are because we still have Mommy.”

That’s how we understand the charitable deduction out here, a long way from Washington. Perhaps the folks from the Post should come visit.

Twelve hundred young people from all over the globe descended on Pittsburgh last week to participate in the One Young World Conference. OYW is a big deal, attracting an all-star lineup of presenters—from Bill Clinton to Jamie Oliver to Kofi Annan—and a wonderfully, wildly diverse group of forward-thinking twenty-somethings. My special assistant, Leigh Halverson, who attended the conference last year, talked my wife Aradhna, who is President of Leadership Pittsburgh, and me into co-hosting a breakout session for fifty of the participants and then a smaller dinner in our home to introduce them to the community. (How Leigh, who masterminded the logistics for all the breakout sessions and home dinners around Pittsburgh, successfully pulled it off is another story, but the bottom line is, she did us—Pittsburgh and The Pittsburgh Foundation—proud.)

My favorite moment in the whole event came when a young woman from India who was attending our breakout session reflected on how much she appreciated learning from all us “old people.”  The room roared with laughter, even us “oldsters,” who also included Heinz Endowments President Bobby Vagt, Riverlife President Lisa Schroeder, Center of Life Executive Director Tim Smith, and UPMC’s Chief Inclusion and Diversity Officer Candi Castleberry Singleton.

The young woman hastened to clarify her real intention but she needn’t have worried—her gratitude for the bridges we had built across age and geography was genuine and unmistakable. It was a moment of real connection that touched all of us so-called “experts.” We walked away from our interactions with the OYWers feeling we had gained as much from our time with them as we had given.  

Congratulations to everyone involved in making this conference a success, particularly Steve Sokol at the World Affairs Council of Pittsburgh, but especially Pittsburgh itself. Your willingness to open your hearts, minds and even your homes to a group of young people from around the world was a gift to them, but even more a gift to ourselves.

The Pittsburgh Post-Gazette today reported that I consider myself a “lousy prognosticator.”

And it’s true, I do.

As we approached the Day of Giving event this week, all of us at The Pittsburgh Foundation were energized and excited by the enthusiasm and feverish expectation that was building among donors and nonprofit organizations. But I had my doubts that we would raise much beyond the $6.4 million received in contributions last year.

How wrong I was. By midnight on Wednesday, contributions of had flowed into our PittsbughGives on-line giving platform over a 24-hour period, resulting in a hefty $8.4 million being raised to support our local nonprofit organizations.

It represents a 31 percent increase at a time of continuing economic uncertainty when under normal circumstances it would be perfectly justifiable to be watching the pennies. But this was not normal, even for the famed generosity of our community in this, the heartland of our nation’s philanthropy.

The results of the Foundation’s fourth annual Day of Giving were truly stunning and far beyond our hopes and expectations. The number of individual donations topped 17,700, up from the 13,600 last year.  Gifts ranged from the $25 minimum to $25,000 and we received 105 separate gifts of $10,000 or more.

And it all went into the much-needed resources of 665 nonprofit organizations in Allegheny and Westmoreland counties to support the critical work they do on behalf of us all.

To all those who made contributions, a heartfelt thank-you from all of us at the Foundation. To all the nonprofits that took part and especially excelled at engaging donors and supporters with an array of on-line marketing and awareness-building tools, thank you for a great job, well done.

Already, I’ve been hearing questions about where we go from here. I am delighted that the Day of Giving has clearly become a high point in the local philanthropic calendar for donors and nonprofits alike, and we will consult with them in deciding how we can further improve the event for 2013.

What do I think will happen next year? Betting is not my forte.

The Day of Giving has become a firm fixture in the fundraising calendar for many local nonprofit organizations, and has become especially important during a period when other funding sources have diminished or disappeared altogether.

Indeed the enthusiastic participation of our region’s nonprofits is again highlighted by the record number taking part in The Pittsburgh Foundation’s fourth annual Day of Giving, to be hosted next week, on Wednesday, October 3, 2012.

More than 700 nonprofits in Allegheny and Westmoreland counties have completed or updated their profiles on the Foundation’s PittsburghGives on-line site to be eligible to receive donations that will qualify for a share of the match pool — $750,000 for The Pittsburgh Foundation and over $80,000 for our sister organization, the Community Foundation of Westmoreland County (CFWC).

There is no doubt that our PittsburghGives program has provided much-needed support at a most critical time. But it is not only about the money raised from the event, although this in itself has been an invaluable source of funding for many or our charitable organizations. More importantly, nonprofits have used this platform successfully to attract new donors, creating broader and more sustainable on-going support. This has been our primary goal from the outset with the Day of Giving.

All contributions received during the 24-hour on-line event next week will receive equal pro-rated shares of the available matching funds, and this year we hope to raise more than the record $6.4 million in total contributions received in 2011.

In fact, last year was an outstanding milestone with a near doubling of money raised compared with 2010 ($3.3 million) and the number of individual contributions – 13,643 in 2011 compared with 7,778 the previous year.

The success of this event over the past three years has been due in major part to the enthusiastic participation of donors and growing members of the public – many of them newcomers to philanthropy – who have given generously to a vast array of nonprofit programs serving our community.

Thank you for using this event to make a huge difference to our local charitable programs, and we look forward to you joining us on-line on October 3.

For years now, the Pittsburgh Federation of Teachers has been on my personal roster of heroes. Their members do challenging, important work educating our kids, and the union’s willingness to work in partnership with the Pittsburgh Public Schools has been probably the critical factor in moving forward one of the most promising school reform efforts in the country.

But at The Pittsburgh Foundation, we simply cannot agree with the PFT’s flat-out refusal to work alongside PPS Superintendent Linda Lane on finding an alternative to the last-in, first-out rule that will soon result in the furloughing of some of the school district’s most effective teachers. If the union persists in that refusal, it could end up gutting the very reform initiative it has helped make happen.

That’s why I joined my colleagues at the The Heinz Endowments and Grable Foundation in penning an oped on the subject that appeared in the Pittsburgh Post-Gazette on Sunday. This was a difficult commentary for us to write. A decade after our three foundations publicly withdrew funding from PPS in despair over the district’s dysfunctions, we  have long-since returned as enthusiastic supporters of a school board, two superintendents and a union who together have held out real hope of proving that urban public education in this country can be dramatically improved. We believe in these folks and what they are accomplishing together.

The heart and soul of this work has been an effort to swell the ranks of highly effective teachers. Teachers matter, and as in any other profession, some are better at it than others. Working on the premise that every child deserves to be taught by teachers who really have the skills to help them learn, PPS and the PFT have partnered in an ambitious program to transform that premise into a reality.

Unfortunately, the district’s fiscal crisis has forced it into the unenviable position of having to furlough several hundred teachers in the coming months. State law in Pennsylvania mandates that teachers be laid off solely according to seniority, regardless of how skilled they are at educating students. The good news is that the union, if it wanted to, could agree to set that requirement aside and develop an alternative that would also make some allowance for considering a teacher’s performance. The bad news is that it doesn’t appear to want to.

In fairness to the PFT, its reluctance is at least partially understandable. Teachers who have been around longer earn higher salaries, and they logically fear being targeted first by the budget-cutting knife. They also note that performance measures can sometimes forget  that high performance in a more challenging school may look different than in an easier setting. And they worry that, historically, methods for evaluating a teacher’s performance have done little to inspire confidence that they will be treated fairly.

But all of these concerns either have been addressed in Pittsburgh or can be if approached in good faith. The critical point is that teachers in Pittsburgh are already subject to a rigorous evaluation process that they helped craft. Called RISE, this evaluation system uses a comprehensive set of criteria developed by the District in partnership with the PFT, and it does a good job of identifying how effective teachers are in helping their students learn.

What would it say about our decision-making as adults if, despite having this critical performance information, we would simply choose to ignore it? Can you imagine any organization–public or private–remaining successful by making critical personnel decisions with complete disregard to whether they are actually the best at their jobs? Insisting on pursuing that course will be bad for the students, for Pittsburgh’s school reform effort and, ultimately, for the union.

We can do better than this. Against the background of the great work that has been accomplished on reform and building teacher effectiveness so far, we should be doing everything in our power to hold onto every effective teacher we possibly can. For everyone’s sake, but most importantly our children’s, the PFT and PPS must sit down together to craft a solution that combines respect for seniority with respect for effectiveness, but above all respect for the students, whose learning needs should matter more than anything.

Click here for the editorial published in the Pittsburgh Post-Gazette on April 29, 2012