As new rules on federal giving show, public’s reaction to plans don’t always yield changes

Joe Davidson
Columnist February 6

Government efficiency and effectiveness aren’t always the same thing.

As Obama administration officials strive to increase the efficiency of a federal employee charity drive, some philanthropy executives fear it could become less effective.

Joe Davidson writes the Federal Diary, a column about the federal workplace that celebrated its 80th birthday in November 2012. View Archive

The trepidation concerns an Office of Personnel Management (OPM) plan to restructure the Combined Federal Campaign (CFC). The plans are included in OPM’s “final rule,” which is not truly final until published by the government. Charity leaders expect that to happen soon.

CFC funnels donations from federal employees to charities — almost 850,000 workers contributed in 2012. In a document accompanying the final regulations, OPM Director Katherine Archuleta says they “are being issued in order to strengthen the integrity, streamline the operations, and increase the effectiveness of the program to ensure its continued growth and success.”

The final rule is the result of a long process that included gathering reaction to proposed regulations. The story of the CFC rules offers a look into how federal agencies evaluate the public comments used to formulate government regulations. In this case, the story demonstrates the frustrations of the leaders of organizations that are heavily dependent on donations from the federal workforce.

Certainly, the charity leaders are “delighted that we’re going to get some efficiencies,” said Kalman Stein, president and chief executive of EarthShare, a federation of environmental and conservation charities that currently administers the local CFC. There is good support for a number of the OPM rules, including extending the solicitation period, allowing new employees to participate immediately instead of waiting until the next solicitation period and creating a standing mechanism for disaster relief contributions.

Yet, the leaders feel key suggestions they offered were overlooked, sidestepped or ignored.

“A lot of us were disappointed, stunned perhaps,” at the shape of the final rule, said Thomas G. Bognanno, president and CEO of Community Health Charities of America. He recalled a July House hearing where members of Congress joined with charity executives in criticizing some of the proposed regulations.

OPM spokesman Thomas Richards said the agency would not comment on the new rules “since we are still in the regulatory process.”

Drawing much heat is a rule that “eliminates cash as a giving method.”

The OPM wanted to eliminate cash, check and money order donations “to increase the efficiency of the administration of the CFC by eliminating burdensome paperwork, saving resources, and removing the possibility of the mishandling of cash,” says the document accompanying the final regulations.

A worthy objective.

But it could sacrifice effectiveness in the name of efficiency. Though cash and check gifts represented only 7.4 percent of 2012 contributions, that’s still a lot of money — more than $19 million of the $258 million donated.

Rosie Allen-Herring, president and chief executive of the United Way of the National Capital Area, said that rule could result in a “significant drop” in contributions.

We “want to make it as easy as possible for people to donate,” she said.

The proposed rule drew lots of opposition — 96.8 percent of the comments said don’t do it, the final rule acknowledges.

The OPM backed off, somewhat. The rule “eliminates cash as a giving method” and includes a five-year transition period to electronic giving.

Similarly, the OPM wanted to kill the Local Federal Coordinating Committees that manage donation drives and, importantly, select the administrator of the local campaign, called the Principal Combined Fund Organization (PCFO).

Charity executives were adamant that killing the committees and doing away with PCFOs would hurt what the OPM document calls the “local touch,” the person-to-person contact that leaders insist is critical to fundraising. The OPM dismissed those concerns, saying they “appear to be unfounded.”

Though 95.7 percent of the comments opposed the OPM’s proposal, agency changes in the final version fall short of what the charities wanted.

“The title Local Federal Coordinating Committee (LFCC) is maintained,” says the final rule, but the power is not. The committees will no longer select campaign administrators.

Furthermore, the PCFOs will be eliminated, despite 83.7 percent of the comments opposing this plan.

Bognanno and other charitable-federation leaders wrote to Archuleta one month ago asking for a meeting to discuss the changes. Referring to the House, the letter said: “Our concern is that OPM may soon issue new final rules, which would be a step that is totally out of sync with Congress’s request for more transparency, thoughtfulness, and expert consideration before taking such action.”

Archuleta was not OPM director at the time of the hearing. The executives told her that members of Congress urged the agency to provide answers “regarding questions and concerns they had about the proposed changes” and to obtain advice from a committee of experts before the rules were finalized.

None of the charity executives or members of their federations “are aware of any actions taken,” the letter said.

The charity leaders said Archuleta did not respond to the letter. Neither would Richards, the OPM’s spokesman.

Twitter: @JoeDavidsonWP

Previous columns by Joe Davidson are available at wapo.st/JoeDavidson.

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