Many of the grants the Baltimore Community Foundation made through a special projects fund last year to help the Baltimore Police Department went directly to programs that put a spotlight on the work of city law-enforcement officers.
One gift of nearly $50, for instance, paid for refreshments at a meeting on a department-led mentoring project for girls. The grant maker spent nearly $1,500 on T-shirts for youngsters at a police-run summer camp and more than $2,500 to paint a mural at police headquarters.
But another gift from the grant maker’s Baltimore Police Foundation Special Project Fund was a bit different. Serving as a fiscal sponsor of the fund, the community foundation paid $120,000 to Persistent Surveillance Systems, a private company, to fly over Baltimore and take aerial photos to assist police in solving crimes. The grant was made at the recommendation of billionaire philanthropists John and Laura Arnold, who made a gift to the police-support fund through their Fidelity Charitable donor-advised-fund account.
No Legal Issues
The grant has left many wondering whether spy planes are an appropriate use of philanthropic money for a foundation dedicated to strengthening a city — especially one as beset by racial strife as Baltimore — and whether the community foundation provided proper oversight as a fiscal sponsor of the fund for police projects.
Legal experts interviewed by The Chronicle made clear that the gift was permissible, but they and other sources raised questions about how the money was disbursed and why neither the foundation nor the police department had disclosed the surveillance project.
Long-simmering tensions between police and the city’s black population burst into national consciousness last year with the death in police custody of Freddie Gray and subsequent civil unrest. Earlier this month, the U.S. Justice Department issued a scathing report showing that city police routinely engaged in “unlawful and unconstitutional” treatment of African-Americans. News of the police surveillance flights, first reported by Bloomberg Businessweek, has made things even more problematic, said Lawrence Brown, an assistant professor in the School of Community Health & Policy at Morgan State University.
Mr. Brown said the revelation will broaden the “rupture of trust” between black Baltimoreans and local civic institutions.
“Now we’re finding it’s the philanthropic community engaging in this behavior,” he said. “It’s quite laughable to classify this as a charitable activity.”
One of the city’s most prominent grant makers has similar questions.
In a statement Wednesday, the Open Society Institute-Baltimore called for a thorough disclosure by police of the program. The philanthropy, an affiliate of George Soros’s Open Society Foundations, said the police department’s secrecy surrounding the surveillance system had “set back the trust-building process” between city residents and law-enforcement officials.
In an interview Friday, Open Society-Baltimore spokesman Evan Serpick said the gift could be considered charitable, since it went to secure public safety, but the lack of public disclosure of the flights was troubling.
Secrecy a Concern
Not all Baltimore grant makers see the surveillance program as problematic.
Robert Embry, president of the Abell Foundation, said he would have been “delighted” if a donor had approached him to make the Persistent Surveillance grant, although he said he would have required that the program be publicly disclosed.
Since 2005, Abell has provided nearly $500,000 in grants to buy surveillance cameras and monitor their use in Baltimore.
“I don’t know what the big furor is about,” Mr. Embry said. “The motive is to be able to solve crimes. As far as we’re concerned, reducing the murder rate is very much a charitable purpose.”
Thomas Wilcox, president of the Baltimore Community Foundation, said the special-projects fund served as a “conduit” for the Arnolds to make their gift. The foundation is the fund’s fiscal sponsor, a relationship that allows organizations that do not have nonprofit status but carry out charitable missions to receive gifts from donors. By giving money to a tax-exempt sponsoring group, donors can take a tax deduction and be assured their money will go to the cause they designated.
Asked if police surveillance serves a charitable purpose, Mr. Wilcox replied: “The police department is in charge of public safety, and this donor thought this particular project — and we didn’t know much about it — was going to protect neighborhoods and keep them safe.”
Mr. Wilcox said he did not know the identity of the donor until the Bloomberg Businessweek article was published. Earlier this year, he said, Fidelity Charitable approached the community foundation about steering another gift to the special-projects fund to support more surveillance flights, and the grant maker declined, Mr. Wilcox said, because this time the donors wanted the foundation to monitor the program, and the grant maker did not have the ability to do so.
In the future, Mr. Wilcox said the Baltimore foundation will take a closer look at gifts made through the 800 funds it oversees as fiscal sponsor.
Obligations of Charity
Gregory Colvin, a San Francisco lawyer who specializes in nonprofit law and wrote a guide to fiscal sponsorship, said it was “unfortunate” the Baltimore Community Foundation characterized itself as a conduit because the term suggests that the grant maker didn’t have responsibility for how the funds were used. Fiscal sponsors, he said, typically accept funds and hold them as their own assets rather than simply pass them through to a grantee. He suggested that fiscal sponsors enter into a contract with grantees and at the very least require grant recipients to provide an application and budget for their work so the fiscal sponsor can use its own judgment about whether to make a gift.
“It’s an obligation of the fiscal sponsor to make sure the funds are properly spent,” he said.
Generally, if a nonprofit provides support to a government entity so as to lessen its financial burden, the donation can be considered a charitable gift, according to Allen Bromberger, a nonprofit lawyer in New York.
That can include law-enforcement activities. For example, a widely cited Internal Revenue Service ruling in 1985 authorized a charity to give money to a police department to buy narcotics in drug stings.
“If a public body says something is needed for the public interest, generally the charity is allowed to defer to the government,” Mr. Bromberger said.
But he cautioned that just because something is legally charitable doesn’t mean it won’t be controversial, as in the case of the Baltimore overflights.
“There’s a tension between what’s legal and what’s right,” he said. “Boards of charities have to make these judgments all the time.”
