Wednesday, February 9, 2011

Earmarks…good or bad for charities?

Earmarks, that dirty word, may be a relic of the past. If so, what will the effects be on charities? Nonprofit groups are waking up to the fact that when Congress stamped out earmarks, it was talking about their projects. That coupled with a proposed five-year freeze on domestic spending that would cut tens of millions of dollars that they counted on. Thousands of charities will have far less money to spend on legitimate projects. There will be far more applicants scrambling for a smaller pot of grant money. The ban on earmarks to private industry led to an eruption of non-profits closely tied to for-profit companies. Critics portray earmarks as synonymous with wasteful pork-barrel spending and there have been many sizeable abuses that have enriched an elected official. Many have been noted in Nonprofit Imperative. Many charities are struggling and do not know what they are going to do. Some lawmakers have been known to get around the earmarking process by practices known as lettermarking and phonemarking -- in which the offices of members of Congress write or call agencies to get money spent on specific projects. Only time will tell.
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