As NPCs Begin Their Third Decade . . . Recent Developments in Oversight and Ongoing Challenges

1. As NPCs Begin Their Third Decade . . . Recent Developments in Oversight and Ongoing Challenges Kim Collins, Administrator Nonprofit Program Office (NPPO) Barbara West, Executive Director National Association of Veterans’ Research and Education Foundations (NAVREF)

2. Overview Nonprofit Program Office (NPPO) Staff NPPO Goals 2006 and 2007 Annual Reports Update NPC Oversight Plans Legislation – 2008 and 2009 Governance Challenges and Solutions Questions

3. NPPO Staff Administrator - hired September 2008 Staff Assistant - on board December 2008 Auditor/Accountant - in recruitment phase

4. Accomplishments To Date Establishment of a database for use by the NPPO Collaboration with the NPC Steering Committee Addressing the OIG findings about VA NPCs Formulating NPC Oversight Compilation of the 2006 and 2007 Annual Reports to Congress

5. 2006 and 2007 Annual Reports

6. NPCAnnual Revenue2005 - 2007 2005 2006 2007 • $227,239,899 • $230,106,691 • $250,453,983

7. Total NPCExpenditures

8. Financial Position For 2006, NPCs reported $194.1 million in total net assets, this was a 6% increase over the prior year For 2007, NPCs reported $208.4 million in net assets, this was a 7% increase over the prior year This amount includes research projects funds held by the nonprofits as well as operating funds and fiscally prudent reserves

9. Conclusions… The VA-affiliated NPCs continue to make a substantial contribution to the VA research and education missions. NPCs are fulfilling their congressional mandate Revenues and expenditures in support of VA research and education programs are holding steady VA-affiliated NPCs contribute to the success of VA’s research and education programs

10. NPC Oversight Plans VHA Response to OIG Report on VA Nonprofits On site reviews Evaluation Checklist

11. How to Shine During the NPC Review Prepare a binder containing the supporting documentation in an easy to find format Plan to spend time with the reviewers (if necessary) Use the review as an opportunity to review your own NPC and make improvements (if needed)

12. Legislation Passed in 2008 - S. 2162 - Sec. 806 (P.L. 110-387) Provides permanent authority for VAMCs to establish new research corporations NAVREF Proposal to Update and Clarify NPC authorities Would allow NPCs to merge without the addition of all statutory board members Numerous other updates and clarifications without changing the NPCs’ fundamental character

13. Governance Challenges Challenge: Scheduling Board Meetings Issues: Competing demands on board members’ time Time of day Your Solutions

14. Governance Challenges Challenge: Recruiting Non-VA Statutory Board Members Issue: NPC statute requires each NPC to have two board members who are not federal employees Your Solutions

15. Governance Challenges Challenge: Hiring, Compensating and Evaluating the Executive Director Issues: Recruitment – AO, other VA employee or non-VA Setting compensation in accordance with IRS rules Regular evaluation Your Solutions

16. Governance Challenges Challenge: Identifying and Orienting Officers – Chair, President, Secretary and Treasurer Issues: Which officers are required? Advisable? Statutory VA members as officers Responsibilities Your Solutions

17. Governance Challenges Challenge: Overseeing Finances Issues: Too much or too little financial information Understanding financial statements and audit reports Annual NPC operating budget Your Solutions

18. Governance Challenges Challenge: Handling Transfers when a PI Leaves Your VAMC Issues: Active projects and associated funds Accumulated “residual” funds PI moves to another VAMC; leaves VA entirely Your Solutions

19. Questions Thank you! Kimberly Collins kimberly.collins@va.gov 202-461-1714 Barbara West bwest@navref.org 301-656-5005