Recognizing the transparency is a core value in the digital age, the John S. and James L. Knight Foundation is now requiring journalism and media grantees to disclose the identities and amounts contributed by major donors.
The requirement applies to donations of $5,000 and more given to the projects Knight Foundation is funding. The information must be published on the organization’s website.
Below is a list of Frequently Asked Questions for the policy.
FREQUENTLY ASKED QUESTIONS
1. Why is the foundation requiring donor transparency for journalism and media grants?
Transparency is a core value in digital media. For digital media projects to be successful, we believe they must be transparent. As Knight Foundation helps lead journalism to a better future in the 21st Century, want to be clear about the value of transparency. Transparency in journalism and media grant-making will be an important distinguishing characteristic of Knight Foundation grants, and, we hope of the grants of other leading foundations in journalism and media grant-making.
2. What grants are ‘journalism and media grants’?
They are any grant made in the Journalism and Media Innovation Program, as well as grants made through the Knight Community Information Challenge, the Community Arts Journalism Challenge and occasionally by other parts of the foundation. Our intent is to ensure that people consuming news and information from media ventures that we fund know who is supporting those media outlets. In general, journalism and media projects are those aiming to provide news and information to specific communities.
3. Does this apply to all grantees or only new grantees?
Donor transparency for journalism and media grants is only a requirement for new grants. Even so, we think donor transparency is a best practice for digital media. We encourage all of our grantees to do it.
4. Why is it only for donors of $5,000 or more?
In its general reporting rule for 501c3 nonprofits, the Internal Revenue Service requires contributions of $5,000 or more to be listed on the form 990B. Though the IRS has many different reporting requirements, we chose the $5,000 level as the simplest, fairest and clearest threshold. Though nonprofits list their donors by filing the form 990B with the IRS, most nonprofits do not have to make their 990B forms public. But leaders the new generation of web-based nonprofit news organizations have started doing so. Though we require transparency only for funders of $5,000 or more on Knight-funded projects, we encourage projects to find ways to list more than just the major donors. The more transparency, the better.
5. Does an institution like a university, a public broadcaster or a community foundation have to reveal all its donors?
No, the requirement applies only donors giving $5,000 or more to a specific media project also funded by Knight. The institutions unable to produce donor transparency around those specific media projects would not be eligible for Knight Foundation funding for those projects. Anonymous donors from prior years and anonymous donors to parts of the institution having nothing to do with the Knight project could remain anonymous. We think institutions should become more transparent than they are, but we are only requiring transparency specifically on the projects we fund.
6. What about the addresses of the donors?
We do not require addresses to be revealed, but we still encourage it. When people have identical names, their addresses are the way to tell them apart. Addresses are part of the 990B information that the federal government requires. In the future, we may begin to require addresses. At this stage, we decided to require the minimum: names and amounts of donors of more than $5,000.
7. Is this the strictest requirement of its kind?
No. To be a member of the Investigative News Network, your organization must reveal donors of more than $1,000. We decided to use the larger minimum donation of $5,000 because that is what the federal government requires nonprofits to report in the IRS Form 990B. But if organizations want to name all donors, we think that will increase its credibility with the community it seeks to serve.
8. Does a Community Foundation need to list all its general fund donors if it uses that fund for a media project?
No. Only the funders who give more than $5,000 would need to be listed – and only then if those funds are specifically earmarked for the media project. When community foundations fund projects from their general fund, they would list themselves as the funder. But even though we don’t require it, we think greater transparency is a good idea.
9. What if I’m not the media organization myself but I am re-granting the money to the media outlet?
You’ll need to be sure the media outlet in question agrees with the donor transparency rule. Your grantee would need to agree to post the required donor information on its website. If your grantee won’t provide donor transparency at this minimal level, you can’t re-grant our funds to them.
10. Do we actually have to put our entire 990B on line?
It would be easier and more transparent if you wanted to, but you don’t have to. All we are requiring are the fundamentals from that federal form – name and exact amount for all donors of $5,000 or more. So at this point, you do not have to post addresses, even though they are required on the 990B forms. That said, we want to emphasize that we consider our requirements minimal. You are encouraged to go beyond them.
10. How often does this information have to be posted?
The more often you post it, the greater the transparency. But the requirement is that you post it at least annually.
11. Does Knight Foundation post its 990B on line?
Yes, private foundations like ours, as well as certain political organizations, are required to make their 990Bs public. Ours is on our website.
12. Will this apply to the foundation’s program- related investments in media?
Yes, program-related investments are grants, so the disclosure applies.
13. What do I do if all of my donors are happy to go along with this except one? Can I appeal to the foundation for an exception?
Yes, you can appeal. You will, however, need to tell us the name of the donor to do that. And you should know that we are serious about this policy and while anything is possible, we do not anticipate making exceptions.
14. What happens if I promise donor transparency, but then in practice I do not live up to that promise?
Once you commit to compliance in the grant agreement, if you don’t comply during the grant period, you might forfeit the rest of your grant. In addition, we might ask you to repay whatever Knight money you already have received.