Editorial: Helping more animals with fewer resources

From ANIMAL PEOPLE, April 2009:

A year into the global financial meltdown, the humane
community as a whole seems to be holding up relatively well, so
far–but precariously.
Puppy mills, by contrast, are collapsing at an
unprecedented pace. 2008 brought more than twice as many dogs and
cats into animal shelters as result of breeder failures than 2007,
and the 2009 volume from breeder failures is on pace to eclipse the
2008 record.

Some animal charities have collapsed, as well, leaving
hundreds of animals in need of accommodation by the surviving
organizations. Through 2008, however, the numbers of animals left
in need by animal charity failures had increased only marginally from
2007. Because many animal charities had rapidly expanded their
holding capacity during earlier boom years, the humane community has
so far managed to absorb most of the animals left by puppy mill and
animal charity failures with only occasional reversion to the
on-the-spot mass killing of impounded animals that frequently
resulted from such cases in past decades.
There have been exceptions, however, and there is much
anxiety among the humane community that continued economic distress
could force a return to high-volume shelter killing. Animal
advocates in cities and counties whose shelters are now pursuing the
elusive goal of no-kill animal control fear that momentum and public
support will be lost if killing rates blip upward. Activists in
cities and counties that have only just begun to promote low-cost dog
and cat sterilization fear that the urgently needed sterilization
programs will be lost to budget cuts. Where gassing animals has
recently been abolished but gas chambers remain in place, there is
concern that gassing will resume as a perceiving cost-trimming
measure–even though shelter consultant Doug Fakkema has assembled
hard data demonstrating that gassing is actually a more expensive way
to kill animals than use of pentobarbital injection.
The good news, so far, is that even though shelter
surrenders of animals have increased, and even though adoptions are
markedly down, shelter killing in the U.S. does not appear to have
increased since ANIMAL PEOPLE in July/August 2008 published our most
recent set of regional tables. Two-thirds of the way to publishing
our 2009 tables, most incoming data continues to show modest
declines in shelter killing.
The bad news is that data from fiscal years ending in 2008
may not include the numbers from the worst of the economic crisis.
If 2008 brought a downturn in the numbers of dogs and cats who were
sterilized by nonprofit programs, the result will be more puppies
and kittens born during the 2009 “puppy and kitten season” that is
now just beginning.
Humane societies and animal control agencies are used to
working in crisis mode. Coping with whatever the emergency for days,
weeks, or even months is familiar to veterans of animal rescue. The
most stressful part of the present situation, for many and perhaps
most animal agency administrators, is not being able to look ahead
to a specific time that may bring respite. Floods recede and fires
burn out, but a recession does not hit bottom on a predictable
schedule. No one knows how long resources may have to be stretched,
how secure program funding is, or how secure jobs are.
What we all do know is that if lean times get leaner, the
need for humane services will only increase, and donations decrease.
For many individual donors, the most frustrating part of the
crisis is not being able to respond as generously as they would like,
because they themselves have lost jobs, or fear their jobs may be at
risk, or are using whatever extra resources they have to help
stricken family members–and the family members’ animals.
ANIMAL PEOPLE is coping with the same pressures as the rest
of the humane community, and other print media too. In 2007 we were
obliged by a 35% increase in printing and mailing costs to reduce our
frequency of publication from 10 editions per year to nine. In
September 2008 we suspended mailing free subscriptions to foreign
animal charities. At the end of 2008, having lost several pages of
pre-sold advertising, including from one organization whose budget
was frozen by an archaic law that prevents it from using a
significant endowment, we dropped from 24 pages per edition, our
size since mid-1995, to 20 pages, our count in 1992-1995.
We have, nonetheless, fared much better–through the much
appreciated continued support of our generous readers–than many of
the largest and most prestigious U.S. daily newspapers. Unlike the
collapsing dailies, most of them failing only a few years after
turning record profits, ANIMAL PEOPLE has always been published on a
nonprofit basis, to fulfill a community need. Our modus operandi
has always been close to the model that mass media analysts suggest
is most likely to succeed in the 21st century. Thus, though the
times are difficult, we are as optimistic about our own future as
about the future of the humane cause.
Animal advocacy has actually expanded in many past
recessions, in part because national and international economic
calamity has tended to expose the failings of major animal use
industries. For example, the first few dozen humane societies in
the U.S. formed during the recession that followed the end of the
U.S. Civil War. The number of U.S. animal shelters increased by half
during the Great Depression. The Humane Society of the U.S.,
Friends of Animals, and the Animal Welfare Institute are among the
most prominent of a generation of animal charities that emerged amid
the post-Korean War recession. The animal rights movement debuted
during the post-Vietnam War recession. After a few years of national
economic recovery, the U.S. unemployment rate soared during the
first few years of the 1980s–but those same years brought the
formation of PETA, the Best Friends Animal Society, and In Defense
of Animals, among dozens of other animal charities of continuing
prominence.
The present recession coincides with increased recognition of
global warming and ecological damage to the world’s oceans, of which
overfishing is a leading cause. The rise of concern for farm animal
welfare is already a political fact in many nations, driven by
outbreaks of deadly zoonotic diseases in some parts of the world
where there are no strong farm animal advocacy voices. The role of
violence toward animals as a precursor to violent crime against
humans is increasingly recognized, even where there are no humane
laws.
There is, in short, every reason to believe that current
events favor the humane message. On multiple fronts the humane
community is uniquely positioned to help humanity to effectively
address problems which are at once more urgent and more enduring than
how we organize the exchange of chits representing assets and credit.
The economic crisis is an administrative issue. When the global
economy recovers through administrative changes, and it will
recover, sooner or later, the issues that the humane community can
help with will remain, and will continue to demand humane leadership.

Trust funds lost when most needed

Meanwhile, there is the reality that animal charities are as
squeezed by the financial crisis as anyone else. Amplifying humane
perspectives is inhibited when cash flow is stretched just to provide
basic care to animals in need. An inescapable irony is that the
humane community might have all the resources necessary to fulfill
present needs and opportunities, if only the wishes of legators had
been honored.
Manhattan Surrogate Court judge Troy Webber on February 25,
2009 ruled that the trustees of the Leona M. & Harry Helmsley
Charitable Trust are not bound by the first clause of Leona
Helmsley’s 2004 mission statement, to make grants for “purposes
related to the provision of care for dogs,” and may instead follow
the second clause, to fund “such other charitable activities as the
trustees shall determine.”
Helmsley Charitable Trust spokesperson Howard Rubenstein
stated that the trust’s funds, estimated at $5 billion to $8
billion, will be allocated “as soon as possible in such areas as
health care, medical research, human services, education and
various other areas” that he did not specify.
“Rubenstein did not say whether dog-related charities would
be guaranteed recipients of the trust,” reported Amy Westfeldt of
Associated Press.
The Helmsley Charitable Trust assets alone could have trebled
the resources of the U.S. hands-on animal welfare community, with
enough left over to extinguish canine rabies worldwide. Instead, it
may do nothing for animals whatever.
The Helmsley debacle came 16 years after tobacco heiress
Doris Duke left $1.2 billion to endow the Doris Duke Charitable
Foundation, mandated to fund projects in the areas of the performing
arts; the environment; prevention of cruelty to children and
animals; and biomedical research. Duke also expressed her interest
in animals by leaving smaller sums to the Doris Duke Foundation for
the Preservation of Endangered Wildlife, the Doris Duke Foundation
for the Preservation of New Jersey Farmland and Farm Animals, and
the New York Zoological Society. Then, recalled HSUS president
Wayne Pacelle when the Helmsley verdict was announced, the Doris
Duke Charitable Foundation trustees “parsed the language of Duke’s
will to justify exclusion of animal welfare funding as a priority.”
This too had a precedent. Candy heiress Helen Vorhees Brach
was murdered in 1977 while personally investigating a ring who killed
race horses to collect insurance. The perpetrators were finally
brought to justice nearly 20 years later. Brach had already formed
the Helen V. Brach Foundation. During her lifetime, 100% of the
Brach Foundation went to projects benefiting animals, reported Steve
Warmbir of the Elgin Daily Herald. After Brach’s death, projects
benefiting animals got just 20% of the grant money allocated during
the next five years, Warmbir found. This had dropped to 10% by the
time Brach’s brother Charles Vorhees died in 2002, and was 7% in
fiscal 2008.
Helen Brach’s will has been cited in at least four estate
planning handbooks as an example of sloppy wording that enabled the
Helen V. Brach Foundation trustees to circumvent her own intentions,
and to instead fund projects of personal interest to them. The same
could be said of the Duke and Helmsley estates. But Brach, Duke,
and Helmsley also made a more fundamental error in putting their
estates into perpetual trusts, instead of liquidating their assets
to directly endow the charities they meant to support.
Contrary to common belief, creating a perpetual trust does
not help to ensure that an estate will not be misused. Rather, it
gives more people the opportunity to misuse it, while keeping the
money away from the purpose it is supposed to be used for.
The whole notion of endowing a charity in itself also
requires revisiting. Conventional wisdom in nonprofit management
holds that legacies not specifically designated for a here-and-now
purpose should be kept in permanent reserve, to generate interest or
dividends. Typically these returns are invested in fundraising from
the public. The endowment income thus drives institutional growth.
However, while 5% to 10% of the endowment helps to fund the work of
the charity, 90% to 95% helps to fund whatever for-profit enterprise
the rest is invested in, via banks and stock brokers.
Though investing endowments is considered to be the “safe”
approach to ensuring that a charity will have a future, endowments
can be lost to bad investments–and many recently have been.
Hundreds of charities, including dozens in animal work, have lost
the equivalent of many months or even years of operating expenses.
Some invested in unrepaid mortgages. Some were caught in the
collapse of the stock market. Either way, money left to help
animals did less for animals than if it had insulated a rat’s nest.
To limit the potential damage from investment losses, many
states have laws preventing charities from using endowment funds if
the value of the endowment funds falls below the sum of the money
that has been put into them. Thus the Massachusetts SPCA, still
among the 10 richest humane societies in the world, is laying off
staff for the second time in six years and is closing three shelters,
leaving large parts of Massachusetts with severely restricted humane
services. At least three other humane societies among the 20 largest
in the U.S. are making deep cuts in services for essentially the same
reason.
The fallacy inherent in both creating posthumous trusts and
in funding endowments is in seeking perpetuity–in effect, investing
in the continuance of misery, withholding resources now so as to
help a little bit later.
Thoughtful estate planning empowers credible and committed
beneficiaries to lastingly reduce suffering in the future by
eradicating sources of misery here and now.