Inside the News

The cost of giving

   Who knew it could cost so much for foundations to give away money?

   They all pay accountants.

   Most fork over money for taxes.

   At some fortunate foundations, the founders are still alive and adding new money every year. The rest, however, hire investment advisers to preserve and build up their assets.

   And then there are the trustee costs.

   Eight of the 10 biggest foundations pay salaries to their boards or key employees.

   But so do many small foundations, even those with less than $1 million in assets.

   Trustee expenses topped costs at a dozen foundations.

   Bernard Tolbert, the former head of the FBI's Buffalo office who is now in charge of security for the National Basketball Association, serves as chairman of the Statler Foundation's board, where he makes $16,500 a year, along with the other trustees.

   He travels from his home in New York City once a month to attend foundation meetings in Buffalo, and puts in many hours every week beyond that on Statler work, he said.

   "I don't think anyone does it for the money,"  he said. "If that's the case, we'd be better off getting a job at McDonald's."

   Pablo Eisenberg, with the Georgetown University Public Policy Institute, says boards tend to be filled with "high power, higher paid professionals."

   "It's just an outrageous thing that these wealthy folks should get paid for doing their civic duty," Eisenberg said.

   Do you agree? Or do those entrusted with hundreds of thousands of dollars, and even millions, deserve to be paid?

   --- Patrick LaKamp

Foundations: personal perspectives

   Short tales of how foundation money changes lives are in the story of the free-tax clinic and in today's multimedia collection of video shorts: From Sister Helen Wolf, who used foundation money to do neighborhood outreach and find a way to connect with African refugees, to after-school program that is one boy's oasis and Lisa Clute's discovery of the free tax clinic and how it  helped her climb out of overwhelming debt.

   Foundation leaders say they do try to use their millions to help this economically ailing region and the working poor and people who live in poverty. Traditional scholarship programs are still in the mix, along with more unusual efforts intended to do something else besides tend to the  daily needs of desperation. They say they want to address some of the more complicated problems, such as the tax clinics effort to get unclaimed refunds and a program to train administrators to do a better job of leading public schools that are failing.

   What do you think? Is this enough? What else should be done? Share your ideas of  better ways for foundations and nonprofits to spend millions of dollars exempt from taxes and reserved for charity. Or, has philanthropy from a foundation affected your life at time of great need? Tell us your story.

-- Michelle Kearns

Foundations: no shortage of need

   Local foundations give away almost $100 million a year … and it's still not enough.

   Just ask Marlies Wesolowski, who runs a community center in the Broadway-Fillmore neighborhood.

   She had to eliminate a crime-prevention program that helped elderly residents because she couldn't find $22,000 in funding.

   Meanwhile, the Buffalo Philharmonic Orchestra received more money than the total given the United Way, United Jewish Fund and Catholic Charities combined, a Buffalo News analysis of giving found.

   "I don't want to come across criticizing the foundations," Wesolowski said. "We're fortunate to receive gifts from foundations. So I don't want to be critical, too much so, about what they do and don't do."

   But she is disappointed her Lt. Col. Matt Urban Center had to cut a program she called "needed and necessary."

   "Would we like more? You bet," she said. "Could we use more? Sure we could."

   The foundations are quite aware of the need.

   "There are more needs than we have resources for," said Howard Zemsky, a trustee for the Zemski Family Foundation, which has given nearly $4 million in grants since 2002. "We're not lacking in requests and for projects to support."

   As Buffalo hovers near the top of the national list of the poorest cities, even those who run local foundations wonder if they should re-evaluate who's getting the grants.

   Deciding priorities isn't so simple, however.

   Even experts disagree.

   "Too little money goes to benefit those that need it the most," said Aaron Dorfman of the
National Committee for Responsive Philanthropy.

   But Emmett Carson, former chairman of the National Council on Foundations, said foundations
should give to whatever causes they want.

   "That's what makes philanthropy strong … the ability of people to pick the issue that's important to them," he said.

   What do you think?

      -- Patrick Lakamp

The secret to the Capital District's success

   There are many reasons why the economy in the Capital District has fared better than other upstate communities over the past generation.

   Certainly, there's been a relatively stable state work force (though its numbers have declined in recent years), less reliance on manufacturing, a proximity to New York City and Boston, and strong ties between colleges and the private sector.

   But the growing role of state government as a major player in shaping the Capital District's economy has frustrated business and government leaders in other upstate communities.

   Nowadays, there are high-tech firms coming to the Capital District with high-paying jobs. Colleges are expanding, adding sprawling new facilities, computer research centers, theaters and other trappings that depict a healthy regional economy.

   It's not Raleigh or Austin or Silicon Valley, but the Capital Region, with the state propping up its economy, has seen housing prices rise mightily over the past decade compared to other upstate communities. Population is growing, albeit behind the national rate, but ahead of other upstate areas and places like the Buffalo area, which has bled population.

   Folks around Albany say the state has helped, but it's taken far more than government bureaucrats opening up the state's coffers to boost the region's economy.

   The Spitzer administration, meanwhile, says it wants to end the days of kicking state money out of the airplane, as they used to say about former Gov. George Pataki, to a hodgepodge of projects. Instead, Gov. Eliot Spitzer says his administration is focusing on the strengths of individual regions …  and looking to grow their economies based on those strengths.

   …  Tom Precious

Child Porn Pipeline

Like many of you, we at The Buffalo News  - editors, reporters, photographers - cringe when we learn about children being sexually abused. How unfair it is to steal the innocence of a child. Yet, in recent years, we read about it more and more. A Jamestown man forced an 8-year-old to perform sex acts in front of a Web cam. A South Buffalo man admitted taking pornographic pictures of a 5-year-old.  An Amherst teacher was arrested for viewing child pornography on the Internet. So was a Hamburg policeman. So was a Rochester area doctor.

It's frightening.

We began doing some research, not sure what direction our story would take, but convinced that we had to do something to focus more attention on the issue.

We talked to law enforcement and read everything we could on the subject, from newspaper articles and Internet postings to Congressional testimony and scholarly journals.

Clearly, this was the underbelly of the Internet age. The disgrace of the 21st century.

But there was also, we soon realized, some kind of Russian connection. So many of the men arrested in Buffalo were viewing child pornography made in Russia.

Being a regional  - not a national or international - newspaper, The Buffalo News rarely sends reporters outside the country on assignment.

But we felt so strongly about this story that we did some more research, then asked Editor Margaret Sullivan to send one reporter and one photographer to Russia to learn more about this Russia-U.S. connection.

Months later, reporter Lou Michel and photographer Derek Gee were headed to Moscow.

Meanwhile, reporters Sue Schulman and Dan Herbeck continued working on the story in Buffalo.

We've spent almost a year now researching, writing and photographing "The Child Porn Pipeline."

We hope the series has some impact.

We hope it answers some questions about a terrible crime problem that is growing fast in our community and around the world.

We hope government, law enforcement, and the computer industry does something about it.

We need to protect our children.

-- Sue Schulman, Lou Michel, Dan Herbeck, Derek Gee