Saturday, November 19, 2016

NOM: And the total is ...

Brian S. Brown
65 million dollars to accomplish what exactly? Good job Brian S. Brown. Since 2007, National Organization for Marriage and NOM Education Fund have spent a combined $65,093,000 of donor money. Thirteen million of that was processed through NOM-Ed meaning that is was tax deductible. We all subsidized whatever sums came from individuals rather than foundations. Please note the following:
  • The earliest return that I have for NOM-Ed is 2011. From that we get 2010 (“prior year”) expenditures. There could be expenses for 2009 and earlier that are obviously not included in the total.
  • It doesn't look like there is duplication of shared expenses. However NOM is the front office of Fuck-Ups so anything is possible.

Just how dire is their financial condition?

To answer that question I consolidated the two entities. For the record, that is accounting fiction. There is no such thing as consolidating financial statements for separate non-profits. Nevertheless, it is instructive. The two organizations share resources and NOM has moved money around as necessary. I eliminated the inter-organizational loan. Doing so increases NOM's assets while decreasing NOM-Ed's.
While combined revenues decreased by 28%, expenses did not keep pace, declining by only 16%. This is despite cutting payroll by $435 thousand between 2014 and 2015.

Yet the big problem is working capital

The deficit has swelled by 67%. Working capital is the difference between current assets and current liabilities. It depicts the ability to pay suppliers, meet payroll and meet other expenses such as occupancy. With some assumptions (guesses if you prefer)  which include deducting payroll and occupancy from expenses we can calculate the turnover of accounts payable and then calculate that 139 days are required to pay suppliers. These are bills that are payable generally at the end of each month. In other words, Brian Brown or his cannon fodder have a job of fending off creditors who are threatening to sue.

There are a large number of questionable items. The payroll taxes do not prove out correctly. What did they get for nearly $70 thousand in legal fees? There are also a number of errors and omissions in the returns. The Service will probably remain oblivious.

Insolvency.

With negative net worth and negative working capital, NOM is technically insolvent. I doubt that they could survive a chapter 11 bankruptcy filing but anything is possible. The dire financial condition probably attracts some donors through need but, I suspect, mostly deters donors who see their money going to pay off creditors in contrast to programs.

I have to give Brian Brown some credit. In spite of an abysmal track record he has managed to secure another gig as the leader of the hate group World Congress of Families with the potential to obliterate that organization. And let's not forget that he has a third gig with ActRight.

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