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Financial Disclosure for Quasi-Governmental Organizations -- A Need for Compromise
Friday, October 17th, 2008
Robert Wechsler
To what extent should financial disclosure rules be applied to
nonprofits that do government work?
According to an article in Sunday's New York Times, two years ago New York State extended disclosure requirements to the board members of nonprofits "affiliated with, sponsored by or created by a county, city, town or village government." The goal was more transparency in quasi-governmental organizations.
But the state's annual forms are lengthy, and many of the prominent people who sit on these nonprofit boards feel they are doing a service and shouldn't have their private financial affairs put out for public consumption. So lots of complaints have been made, and the New York City Conflicts of Interest Board has been listening. It has shrunk the list of covered NYC nonprofits from 125 to at most 30.
The best solution, I think, would be to have these board members limit their disclosure to relevant interests, such as interests in any firms that contract with their organizations or relatives who work for their organizations or their contractors. Disclosure is not an all-or-nothing issue, and should not be treated as such. But the COIB is not in a position to change the state law, so it has little choice. However, it can (and probably has) recommended changes to the law.
One thing I hate to see in shrinking the list of nonprofits is the splitting of hairs in the legislative language. The article points out that the Fund for Public Schools, chaired by the Schools Chancellor, was taken off the list because the school system is not "a county, city, town or village government." Since when are schools not governmental organizations? It's true they should have been expressly included, because they're often regional, a different level of government. But they're not regional in New York City.
Disclosure is as important as it is sticky. People who volunteer to serve in government don't want to give up their privacy, and they shouldn't have to. But they should be required to disclose possible conflicts. Everyone thinks that the disclosure required of U.S. Senators is the norm, and that's scary. But sometimes too much is asked of local government officials, especially of volunteers. On the other hand, organizations of local governments often oppose even the slimmest of requirements.
Compromise is important here. It sure beats hair-splitting and celebrity protests.
Robert Wechsler
Director of Research-Retired, City Ethics
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According to an article in Sunday's New York Times, two years ago New York State extended disclosure requirements to the board members of nonprofits "affiliated with, sponsored by or created by a county, city, town or village government." The goal was more transparency in quasi-governmental organizations.
But the state's annual forms are lengthy, and many of the prominent people who sit on these nonprofit boards feel they are doing a service and shouldn't have their private financial affairs put out for public consumption. So lots of complaints have been made, and the New York City Conflicts of Interest Board has been listening. It has shrunk the list of covered NYC nonprofits from 125 to at most 30.
The best solution, I think, would be to have these board members limit their disclosure to relevant interests, such as interests in any firms that contract with their organizations or relatives who work for their organizations or their contractors. Disclosure is not an all-or-nothing issue, and should not be treated as such. But the COIB is not in a position to change the state law, so it has little choice. However, it can (and probably has) recommended changes to the law.
One thing I hate to see in shrinking the list of nonprofits is the splitting of hairs in the legislative language. The article points out that the Fund for Public Schools, chaired by the Schools Chancellor, was taken off the list because the school system is not "a county, city, town or village government." Since when are schools not governmental organizations? It's true they should have been expressly included, because they're often regional, a different level of government. But they're not regional in New York City.
Disclosure is as important as it is sticky. People who volunteer to serve in government don't want to give up their privacy, and they shouldn't have to. But they should be required to disclose possible conflicts. Everyone thinks that the disclosure required of U.S. Senators is the norm, and that's scary. But sometimes too much is asked of local government officials, especially of volunteers. On the other hand, organizations of local governments often oppose even the slimmest of requirements.
Compromise is important here. It sure beats hair-splitting and celebrity protests.
Robert Wechsler
Director of Research-Retired, City Ethics
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