How to Give the Gift Of Giving Year ‘Round
Corrections or additions?
These articles by Douglas Dixon and Michael Schumacher were
prepared for the December 20,
2000 edition of U.S. 1 Newspaper. All rights reserved.
New from NJEDA: Tech Upgrade for Kringle
It has just been revealed that the New Jersey
Economic
Development Authority (NJEDA) has been working on a secret project
with Kringle Corp. Inc. to perform a technology upgrade of the
entire Kringle corporate enterprise inventory and delivery
infrastructure.
Commented Santa Claus, the Kringle Corp. CEO, “New Jersey
and you, ho, ho, ho!”
For the past year, elves from the Kringle Corp. technology division
have been taking classes at The College of New Jersey to upgrade
their skills in Web design and programming, particularly in the
object-oriented
languages C++ and Java. The elves attended the college incognito,
and apparently this experiment was a holly jolly success.
Kringle Corp. was originally attracted to New Jersey as a logistical
and distribution center because of its location adjacent to a
northernly
shipment route. Due to the steady growth in its client population,
and the increasing bulk and weight of its deliverables, Kringle Corp.
needed to develop a more decentralized approach to inventory
management.
With funding from the New Jersey Economic Development Authority,
Kringle
Corp. established a warehouse and distribution center near Newark
Airport, with access to air and snow transportation. The Port
Authority
of New Jersey estimates this location will lighten the load for
the Kringle delivery vehicle, allowing it to travel more rapidly
during
transit through other continents, and then stop in Newark to take
on the sacks for this continent. This reduces time from warehouse
to tree, which is particularly important for perishable goods such
as partridges and figgy pudding.
In order to better manage its inventory and deliverables, Kringle
Corp. has been working with database and artificial intelligence
experts
from Princeton University to develop an integrated client and
gift tracking and matching database system. With this system, Kringle
Corp. can input gift requests and suggestions from clients, and then
match them against available inventory and potential suppliers. The
database also uses fuzzy logic to make a list that weighs gift quality
against client disposition ratings, using a calibrated scale from
“naughty” to “nice.”
Kringle Corp. also has been able to make use of the
Internet to perform more precise client ratings by evaluating the
materials that clients are posting and transmitting via the Internet.
It is developing automated tools to scan websites, E-mail, and chat
room transcripts in order to check twice for troubling client
behavior.
One future possibility is to provide for direct observation of client
goodness, to see them when they are sleeping and when they are awake,
by connecting to feeds from microphones and WebCams attached to client
PCs.
One major advantage of this new database system is that Kringle Corp.
can take advantage of E-commerce suppliers to address the growing
need for the more technologically-sophisticated items requested by
clients that are replacing the more traditional items manufactured
by the legacy Kringle Corp. facilities. In particular, Kringle Corp.
has been able to take advantage of automated shopping and bidding
systems to reduce stocking costs by selective acquisition of popular
and nostalgic items such as golden rings and sweet silver bells
through
auctions on eBay.
One of the important considerations for this database design was to
maintain the security and privacy of the client information.
Unfortunately,
before the security systems were fully implemented, several young
hackers were able to penetrate the system and adjust their own ratings
towards the nicer end of the scale. However, they were detected, and,
as a result, they had better watch out during the upcoming holiday
season for the Lump O’ Coal virus embedded in a fruitcake.
Kringle Corp. also worked with Princeton-based communications experts
and engineers from several unidentified companies to develop a
sophisticated
worldwide communications system. This provides constant cellular
communications
during airborne and rooftop operations, and uses a GPS tracking system
installed in the delivery vehicle to monitor progress during the
night’s
run. The specifications for this system were particularly demanding
due to the need for it to operate continuously, even when the weather
outside is frightful.
The firm is now considering a follow-up project to develop a bionic
reindeer power and guidance system for the delivery vehicle. This
is intended to automate the sometimes temperamental red-nose guidance
system now in use on foggy Yuletide eves.
In recent years Kringle Corp. has become concerned about escalating
client pouting over receiving incorrect packages. While some of these
reports may be explained by client misjudgments of the type of item
for which they are qualified, Kringle Corp. has moved to tighten its
delivery processes. All inventory, whether hard goods or plush, is
now bar-coded and tracked throughout the Kringle Corp. system. To
verify the destination itself, Kringle Corp. is installing universal
bar-coded markers on client properties, unobtrusively located near
the crown of the chimney.
Finally Kringle Corp. is also considering the use of biometric
identification
systems as definitive verification that the correct item has been
delivered to the proper individual. Marlton-based Iridian
Technologies
Inc. (formerly IriScan, Inc.) was planning to bid for this contract
until R&D determined that identifying individuals by scanning the
iris pattern of the eye is logistically impossible when they are
nestled
all snug in their beds.
— Douglas Dixon
Top Of PageHow to Give the Gift Of Giving Year ‘Round
It’s the holiday season and homes all around are strung
with glowing lights and other festive decorations. For some, this
time of year means gathering with family and friends infrequently
seen during the preceding months. Others look forward to frolicking
at parties oozing with good cheer. And gift giving is as much a part
of this time as the scent of freshly felled conifers and home-baked
delicacies.
For those inclined to give more than the usual store-bought trinkets
and mass-produced tokens of affection, there are opportunities here
in our neighborhoods that provide benefits to worthwhile causes all
year long.
One such way is to join with your local Community Foundation —
a professional organization that oversees endowment funds set up by
members of the community and which makes charitable grants to local
nonprofit organizations. Your donations can be pooled with others
and provide huge benefits to concerns are as varied as our holiday
traditions. These causes include education, healthcare, the
environment,
academia and much more.
“Thanks to community foundations, evolving into a philanthropist
is easier than ever before,” says Nancy Kieling, executive
director of Princeton Area Community Foundation, one of several such
organizations in the Garden State. “While traditionally reserved
for the super-rich, philanthropy is now open to a more diverse field
of donors,” says Kieling.
There are more than 500 Community Foundations in the country, but
only four based in New Jersey. In addition to PACF, the others are
the Community Foundation of New Jersey in Morristown, the Summit Area
Public Foundation in Summit, and the Westfield Foundation in
Westfield.
According to PACF’s website (www.pacf.org) the organization was
created “to bring the services of a community foundation to the
greater Mercer County area. The Foundation has grown quickly through
the generosity and vision of many in this community who have
recognized
the Foundation as a capable and agile steward of their philanthropic
resources.” The total value of PACF’s funds in November was $12.5
million, with over than $800,000 distributed so far this year. Last
year PACF disbursed a record $853,000 to more 250 non-profit
organizations,
an all-time high for the nine-year-old organization.
PACF manages several types of funds. Some are tied to specific causes
such as the mental health, AIDS, women issues and the arts, while
other types, such as the unrestricted funds, support organizations
across greater Mercer County at the discretion of PACF’s board.
Donations
made to these funds are pooled together with others that form the
basis of the endowment. Typically, only interest on the principal
is used for grants. Exclusively PACF and its advisory board control
each of these funds.
Another fund option allows the donors greater involvement in
decision-making
of disbursements. The donor-advised funds, as the name implies, allow
those bankrolling the fund the ability to specify where they would
like to have grants made. About half of the more than 80 funds PACF
manages are donor-advised. “Setting up a donor-advised fund is
simple,” says Kieling. “It can be done quickly. A simple fund
agreement lays out the terms of the fund, who the advisor will be,
and what role the foundation plays in the management of the fund.
Whatever asset the donor wishes to give can be transferred at their
convenience — cash or appreciated securities.”
“In creating a donor-advised fund, donors retain the right, during
their lifetimes or during the lifetime of other advisors they name,
to recommend grants to specific organization or program field,”
says Kieling.
One of the benefits of a donor-advised fund in a community foundation
such as PACF is the research that takes place on behalf of donors
prior to making a grant. In the majority of the cases, says Kieling,
there isn’t a problem, but when there is, not finding out could result
in a poor investment of a donor’s money. Kieling related that recently
during one of these routine investigations, a prospective recipient
was found to have some internal deficiencies that would not make it
an ideal grant prospect. “It was a great organization, but on
the business side they needed to get things in order. So we advised
against making a grant at this time.”
Kieling added, “From time to time the foundation will call
advisors’
attention to special community needs and programs and invite
participation
in special program initiatives.”
PACF takes an annual fee of one percent of the donor-advised fund’s
balance to administer the fund. That’s really a good deal when one
considers all that’s required to maintain these funds and make
disbursements.
They include administrative, compliance, professional investment
management
and grant making consulting services.
“Donor-advised funds are a very convenient way to make a single
donation and then have the opportunity to make a variety of
contributions
over time,” says Van Zandt Williams, who along with his
wife, set up the Myra and Van Zandt Williams Jr. Fund. “We had
some considerable capital gains and wanted to give it away, so a
donor-advised
fund made sense.”
One of the key factors in the Williams’ decision was the opportunity
to get a tax credit in the year the fund was established, while having
the luxury of time to investigate appropriate grant recipients.
It was not merely a tax break that spawned the John Duncan Wallace
Jr. Memorial Fund. Rather, it was the need to memorialize their
son who died of AIDs several years ago that led Jack and
Happy
Wallace to set up this donor-advised fund, which for the past five
years has been providing grants to such groups as the Trenton chapter
of Habitat for Humanity and the Chaplaincy Fund at the Princeton
Medical
Center, as well as numerous local educational and art related
endeavors.
“We try to pick three organizations a year,” say the Wallaces,
“and contribute to those type of activities and needs that our
son might have supported. Over the years the fund has grown quite
a bit and we can make fairly meaningful contributions.”
Jack Wallace anticipates that in time his other children will take
over as fund advisors. If, however, a donor does not specify a
successor-advisor,
such funds become unrestricted endowed funds of PACF and are pooled
with other PACF assets for future fund making.
The Grandchildren’s Fund is the one of the newest type of
donor-advised
fund to hit the philanthropic landscape, according to Judy
Feldman,
PACF’s director of development and communications. “We were
delighted
when one of our trustees and his wife created a fund to pass on their
family’s tradition of philanthropy to their grandchildren,” she
said. “Even though the children are still young, they will begin
to learn about the needs of others, to make small grants, and to think
about how they can help more substantially one day.”
“We all know that children are like sponges,” says Feldman.
“They soak up everything they see and hear, and learn values early
and best by example. What better way to instill a sense of charity
and compassion for others than by teaching lessons in giving when
children are most receptive, and when they are already learning in
their own everyday experiences about what it means to share.”
Feldman recommends www.kidscare.org and k12edphil.org for
learning more about how children can get involved in philanthropy.
Another useful website: www.inheritance-project.com.
Whether one’s generosity stems from a sense of noblesse oblige —
the nagging notion that “to whom much is given, much is
required”
— or the need for atonement or even a tax break, a partnership
with a Community Foundation is easy to forge. Any amount is
acceptable.
There is a $10,000 minimum to open a donor-advised fund. Grants from
the fund are generally made once the fund has built to $25,000.
— Michael Schumacher
Princeton Area Community Foundation, Inc., 188 TamarackCircle, Skillman, 08558, 609-688-0300. Nancy W. Kieling, executivedirector, www.princetonol.com/groups/pacfCommunity Foundation of New Jersey, 35 Knox Hill Road,Morristown 07963-0317, 973-267-2903. James C. Kellogg, president.The Summit Area Public Foundation, Box 867, Summit07902-0867,908-277-1422. Jon W. Cooper, president.The Westfield Foundation, 301 North Avenue West,Westfield,07091, 908-233-9787. Elizabeth B. Chance, executive director,www.westfieldnj.com/wf/index.htmTop Of PageTaxmen ComethThe tax advantages of setting up a donor-advised fundwere spelled out in PACF’s November newsletter as follows:”Philanthropic intentions and smart tax strategy often gohand-in-handwhen creating either a private foundation or a donor-advised fund.Both give a person the change to make a charitable gift and reap sometax benefits. Generally, in the year you make a gift to adonor-advisedfund you can take an income tax deduction for up to 50 percent ofyour adjusted gross income for a cash gift, and 20 percent for giftsof appreciated property such as publicly-traded stocks. This comparesfavorably with tax deductions of 30 percent and 20 percent of AGIrespectively for similar gifts to private foundations.”Another advantage of the donor-advised fund is that there isno excise tax imposed. A private foundation is generally subject toa 2 percent excise tax on income and interest, or at least 1 percentif higher payout conditions are met.”A private foundation is required by law to spend at least 5percentof its assets on grants and charitable expense annually, whether ornot that much is earned by investment performance. A donor-advisedfund is not subject to the spending rule, and the advisor can suggestgiving away more or less at his or her discretion.””Both private foundations and community foundations file detailedannual submissions to the IRS, and both must make public disclosuresabout their operations. However, donors to community foundations canremain anonymous while the names of private foundation donors mustbe disclosed.”A good rule of thumb in this and other matters where there’s atransferof money for charitable purposes is to check with your tax advisors.And then hope they’re right.Top Of PageWomen PhilanthropistsWomen business owners lead the general population ingiving money and time to philanthropic causes, according to a newsurvey conducted by the National Foundations for Women Business Ownersin cooperation with The Committee of 200 and underwritten by theCenterfor Philanthropy and Nonprofit Management at Merrill Lynch.The report, “Leaders in Business and Community,” is basedon a national survey of 226 women and 235 business owners. “Nineout of ten business owners (92 percent of women and 88 percent ofmen) contribute money to charities, compared to 70 percent of allU.S. households surveyed in 1999,” says Nina McLemore, headof the NFWBO. McLemore says that nearly one-third of the businessowners surveyed make significant personal charitable contributionsof $5,000 or more per year, including 15 percent who contribute$10,000or more. McLemore is president of Regent Capital, a Manhattan-basedprivate investment firm.Men and women business owners say that they have increased theircharitablegifts and activities in recent years, and they are increasing theirworkplace philanthropy by establishing programs to encouragevolunteerismby their employees. These policies include provisions for eitherunpaidor paid leave for volunteer activities, and extended leave forphilanthropicactivities.Women and men philanthropists want to be role models for others.”Aswomen acquire greater personal wealth through business ownership,rising salaries, and inheritance, it is important for them to leveragetheir philanthropy by serving as role models for other businesswomen,”says McLemore. The survey shows that about half of business ownersagree.Other survey findings include:Women business owners are more likely than their malecounterpartsto credit family tradition as motivation for philanthropy.Women begin their volunteerism at a younger age than men.Women are more likely than men to use their volunteer time inleadership positions — serving on board and chairing fundraisersand special events.Business owners are more likely to support an organization thatthey believe in and that is well-run. They are also more inclinedtoward organizations where the solicitor is not pushy, is polite,and demonstrates a need.For the $90 report (36 pages with 19 charts) call the NationalFoundation for Women Business Owners at 202-638-3060, or visitwww.nfwbo.org(E-mail info@nfwbo.org).Next StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
