Charity Cases

Government Leader home > June 2005 issue

June 2005; Vol. 1 No. 2

Charity Cases

By Patience Wait

Gift authority helps agencies stretch resources by accepting donated property. But there are a lot of strings attached.

It’s disconcerting to drive through the woods of a federal facility in rural Georgia and come face to face with a hulking jetliner.

There is nothing to indicate why the aircraft is there on a paved lot surrounded by loblolly pines. There is no runway, and a close look at the aircraft reveals rather worrisome seams between the body and the wings.



Books make a great gift: The Library of Congress’ Charles Stanhope shows off a gift of early illustrated books from the 15th century.

But the aircraft is not meant to fly—it’s there for training. And it ought to have a big red bow on the fuselage—it was a gift from a company to the federal center that trains law enforcement officers from more than 80 agencies.

“We’ve been doing the training for arming the pilots,” said Kent Davis, head of the Office of Legal Counsel at the Federal Law Enforcement Training Center. The center, which provides training for state and local law enforcement officers from around the country in addition to agents from federal agencies, hosted nearly 45,000 students last year—a 35 percent increase from 2003.

“There was a pilot from the company at one of the training sessions who asked how we do counterterrorism training. We took him to the buses we were using and explained how the training was done. He was very impressed but wondered why we were using buses.”

The pilot basically made the offer on the spot, Davis said, promising to shepherd the idea through his corporation. “The rest is history.”

Uncle Sam likes receiving gifts. Anyone can donate money or other items of value to the federal government as a whole; every year, many people give money to lower the national debt, for instance. And a number of individual federal agencies have “gift acceptance authority,” permission from Congress to accept gifts of money, property or services.

The rules aren’t the same for every agency, however, and it’s not as simple as just saying yes—there are a lot of strings attached.

“There is no general convention here,” said Tom Armstrong, assistant general counsel for appropriations and budgeting at the Government Accountability Office. “In order to figure out what an agency can accept, you have to look at the specific gift authority” it has been granted.

FLETC, for instance, cannot accept gifts of money, only of property, goods or services that will assist its mission of training law enforcement officers.



	KENT DAVIS, FLETC: “DHS, in an internal directive, has said ‘Yea, ye shall not solicit,’ even if the Justice Department says it’s all right.”

“Our gift authority specifically says we can accept tangible gifts and services,” Davis said. “The perception is that cash is pretty dangerous” as a donation, because of the potential for ethics problems.

Davis is responsible for the legal review of any gift offers to make sure ethics rules are not violated.

“That’s the toughest legal review we do,” he said. After doing his own research on any potential conflicts, “we make the company sign a statement that they have no pending regulatory action, no contract award in the works.”

Plane truth. When the company offered the jet, it took Davis a few weeks to conduct the review. In addition to regulatory and business reviews, he had to arrange for a fair-market-value appraisal so the plane could be recorded as an asset on FLETC’s books.

He also contacted other interested parties, such as the Federal Aviation Administration, which had to remove the plane from its registry because it will not fly again.

Corporate or individual donors can attach limited conditions to their gifts as long as they do not conflict with governmental or agency objectives. In the case of the jet, the company asked that its name not be released, he said.

Ethics concerns. The decision to accept a gift is made by the director of the center after Davis makes a recommendation on whether it fits FLETC guidelines. FLETC is one of the agencies strictly limited in a key way—it cannot solicit donations.

This restriction is not so much a statutory one as a policy decision made by the Homeland Security Department, FLETC’s parent.

“DHS, in an internal directive, has said, ‘Yea, ye shall not solicit,’ even if the Justice Department says it’s all right,” Davis said.

The ethics concern is a major reason for that limitation. It would not be, or appear, ethical for a company to give tangible gifts to any agency it seeks to do business with or is regulated by—a classic example of conflict of interest. The other limitation is constitutional.

Congress has granted some agencies the ability to accept gifts—in some cases, even request them—but generally it controls the purse strings, Davis said. As a rule, agencies aren’t allowed to spend “extra-budgetary” funds because only Congress can decide spending.

FLETC is at the strict end of the spectrum. Because of statute and policy limitations, the center has received very little in terms of dollar value. Over the past four years, since March 2001, FLETC has received gifts totaling exactly $262,743.92, Davis said, “and the plane was by far the biggest piece of that.”

But other agencies have been granted much greater leeway to bring in donations, including the ability to solicit gifts.

An example at the other end of the spectrum is the Library of Congress.

A large part of everything the library owns is a gift. The copyright department receives copies of everything published in the United States and records them all as gifts.

But U.S. law also allows the librarian of Congress to accept gifts of both money and materials. And the library has a trust fund board of directors with authority to accept gifts of property.

“We have several hundred gift funds, many of them established over time for specific purposes,” said Charles Stanhope, director of development for the library. “These are not supported by appropriated dollars.”

A little light music. Stanhope cited the music division’s concert program. A Washington socialite in the 1930s used to host performances during her salons, and she was determined to have them continue after her death.

“When she was making plans for the end of her life, she endowed a fund so we could have an ongoing free public concert series. She also gifted us with her collection of Stradivarius instruments,” Stanhope said.

One of the largest gifts the library has received—in both square feet and value—is a $10 million grant from the David and Lucile Packard Foundation to begin developing a state-of-the-art National Audio-Visual Conservation Center near Culpeper, Va.

But the most expensive gift came from Lessing Rosenwald, a great collector of books and artwork whose father was president and owner of Sears Roebuck & Co. early in the 20th century. When he died in 1979, he bequeathed the books and other printed materials to the Library of Congress and the artwork to the National Gallery of Art.

“He gave us a collection of rare items completely unique in the world,” Stanhope said, including “early illustrated books from the 15th century.” The library can solicit gifts and has numerous programs for pursuing specific acquisitions.

“It’s not like the gifts just fall in our lap,” said Helen Dalrymple, a senior public relations specialist with the library. “When there are major items that are most appropriate to bring into the library, where we’re the only place that can protect [and] conserve them, we put together proposals and approach major corporations to support us.”

Stanhope said a recent example was the purchase of a very special map. “It was a happy marriage of Congress appropriating $5 million and three friends of the library, donors, stepping up and making a combined contribution of another $5 million,” he said. “We acquired a 1507 printed map of the world, the first with the word ‘America.’ ”

At FLETC, Kent Davis knows he is never going to have access to those kinds of resources. But luck and good relations with the local community have a tendency to come through when there’s a need.

In early May, vice president Dick Cheney paid a visit to the center—a rare opportunity for the center to show off its resources but one that called for extra measures. A local business donated the use of a limo for Cheney, since the center doesn’t have one, Davis said. “But we still had to go through all the reviews and approvals.”