Proposed "America Gives More" act presumes private foundations are "warehouses of wealth," hoarding stores while charities plead, but is it taking right tack?
"How can we increase the flow of money to charitable organizations? With the anemic economic recovery and cuts in government funding, the need for donations is greater than ever, yet funding for charities has remained largely stagnant....There is over $600 billion sitting in private foundations awaiting distribution. However, private foundations have typically limited their annual giving to the minimum amount required by law: 5 percent of their assets. Moreover, since the payment of salaries and other administrative expenses can also count toward the 5 percent requirement, charities often receive far less than the minimum distribution rule would suggest....What is to be done? A bill currently making its way through Congress, called the America Gives More Act, purports to provide the answer. While much of the bill is benign, included among its provisions is one that lobbyists for private foundations have been seeking for years: a reduction in the excise tax on private foundations to 1 percent." -- Ray D. Madoff, the New York Times