R EPOR TR ESUMES ED 018.816 EA 001 220 THE QUASI NONGOVERNMENTAL ORGANIZATION. BY- PIFER, ALAN CARNEGIE CORP. OF NEW YORK, N.Y. PUB DATE 67 EDRS PRICE MF-$0.25 HC-$0.72 16P. DESCRIPTORS- ORGANIZATIONS (GROUPS), INSTITUTIONS, *FEDERAL GOVERNMENT, *PRIVATE AGENCIES, *FEDERAL AID, FINANCIAL SUPPORT, REGIONAL LABORATORIES, *COMMUNITY AGENCIES (PUBLIC), *VOLUNTARY AGENCIES, GOVERNMENT ROLE, AGENCY ROLE, NEW YORK CITY, ORGANIZED TO MEET URGENT NATIONAL NEEDS, PROVIDE INDEPENDENT JUDGMENT, AND OFFER FRESH SOLUTIONS TO COMPLEX PROBLEMS, THE QUASI NONGOVERNMENTAL ORGANIZATION IS DEFINED AS A NONPROFIT ASSOCIATION OR INSTITUTION LODGED IN THE PRIVATE SECTOR OF SOCIETY BUT FINANCED LARGELY OR ENTIRELY BY THE FEDERAL GOVERNMENT, RESPONSIBLE TO ITS OWN BOARD OF DIRECTORS, LOCATED ON NONGOVERNMENT PROPERTY, AND DETERMINING AND IMPLEMENTING ITS OWN PROGRAM. EXAMPLES OF SUCH INSTITUTIONS INCLUDE RESEARCH UNITS SPONSORED BY THE DEFENSE ESTABLISHMENT, REGIONAL EDUCATIONAL LABORATORIES, PRIVATE ORGANIZATIONS SUPPORTED BY CIA FUNDS, TECHNICAL ASSISTANCE PROGRAMS SPONSORED BY THE AGENCY FOR INTERNATIONAL DEVELOPMENT, AND COMMUNITY ACTION AGENCIES SPONSORED BY THE OFFICE OF ECONOMIC OPPORTUNITY. BECAUSE IT SERVES PUBLIC RATHER THAN PRIVATE OR INDIVIDUAL PURPOSES, THE QUASI NONGOVERNMENTAL ORGANIZATION IS DISTINCT FROM THE TRUE VOLUNTARY ASSOCIATION. WAYS NEED TO BE FOUND TO INSURE SUCH ORGANIZATIONS THE FREEDOMS OF PROGRAM, ADMINISTRATION, AND COMMUNICATION, WITH ADEQUATE FINANCIAL SECURITY AND APPROPRIATE ACCOUNTABILITY. THIS ARTICLE IS A REPRINT FROM THE "ANNUAL REPORT FOR 1967." (JK) ..IMIN.. e-t IS I--" A ani I U.S. DEPARTMENT OF HEALTH, EDUCATION iWELFARE OFFICE OF EDUCATION EXACTLY AS RECEIVED FROM THE THIS DOCUMENT HAS BEEN REPRODUCED POINTS Of VIEW OR OPINIONS PERSON OR ORGANIZATION ORIGINATING 11. OFFICIAL OFFICE OF EDUCATION STATED DO NOT NECESSARILY REPRESENT POSITION OR POLICY. Reprinted from the 1967Annual Report CARNEGIE CORPORATIONOF NEW YORK N 589 Fifth Avenue, NewYork 10017 kri 0 10022 0 After March 1, 1968: 437Madison Avenue, New York Carnegie Corporation of New York is a philanthropic foundationcreated by Andrew Carnegie in 1911 for the advancement and diffusion of knowl- edge and understanding. Its present capitalassets, at market value, are about $322 million. Approximatelyseven per cent of the income may be used in certain Commonwealth areas; all other incomemust be spent in the United States. The Corporation is primarily interested ineducation and in certain aspects of governmental and internatbnal affairs. Grants for specificpro- grams are made to colleges and universities, professional associations, and other educational organizations. The presidentof the Corporation is Alan Pifer. The Quasi Nongovernmental Organization IN recent years there has appeared on theAmerican scene a new genus of organization which represents a noteworthyexperiment in the art of gov- ernment. Lodged, through thenormal process of legal incorporation, in the private sector of society, this new entity hasin many respects the counte- rance of the r,._ ate,nonprofit enterprise and even some of thecharacteris- tics of the true voluntary association. Yetit is financed entirely, or in large part, by the federal government,it was created as the result of federal legis- lation or other governmental initiative, andit serves important public pur- poses as an instrumentof "government by contract." We maycall it the quasi nongovernmental organization. What precisely is this new creature? Whyhas it come into being? What unique purposes does it serve? Whyis it quasi nongovernmental? What is its probable future? These are questions that have on the wholebeen little considered. They should interest anyone who is concernedabout the future of private institu- tions in our society. They should alsointrigue anyone who is concerned about howindeed whethercurnational government can remain an effective force in the face of the mountingcomplexity and increasing extent of the problems with which it mustgrapple. For this new social form has, like previous inventions such as the governmentcorporation and the govern- ment foundation, comeinto being not for capricious reasons butbecause it is an indispensable response to newconditions. Our society needs it and accords it an honored, ifindeterminate, place among our panoply of na- tional institutions. What isdifferent about this new development, however, 3 ANNUAL REPORT FOR1967 C, is that although it stems from government,it is not, like its predecessors, located within government. And, therefore, it raises somenovel questions. Quasi nongovernmental organizations seem tobe principally a phenom- enon of the past twodecades. How many of them there are now or how much money government spends throughthem annually, no one knows for sure because of thedifficulty of defining the genus precisely and because of the lack of any centralized information about it.The genus would, how- ever, seem to includethe following distinct and quite different species: several dozen so-called "not-for-profitcorporations" providing advisory and other services to the Air Force, Navy,Army, Department of Defense, Atomic Energy Commission, and National Aeronautics andSpace Admin- istration; a small number of agencies related to theDepartment of State or the Agency for International Developmentproviding educational, informa- tional, cultural, and technical assistance services overseas; a scoreof regional educational laboratories sustained by the UnitedStates Office of Education; and about three-quarters of the more than1,100 community action agen- cies, which receive most of their support from theOffice of Economic Op- portunity. The list would also include the limited groupof organizations which have until recently been wholly supportedby the Central Intelli- gence Agency. Probably not yet to be classified as quasi nongovernmentalorganizations are many additional agencieswhich, unlike the ones just described, have genuine origins in the private sector but which in recent years,with large- scale government financial support, haveincreasingly become instrumen- talities for carrying out public purposes. These agencies arefound in the fields of health, welfare, and education, in theinternationa: area and in other domains. If the special relationships which ley aredeveloping with government become appreciablycloser, they too will be denizens of the halfway house between government and the private sector alreadyoccupied by the quasi nongovernmental organization.One must, therefore, keep these additional organizations in mind as potentialrecruits to the new genus. Characteristics The quasi nongovernmental organization has manyof the attributes of the true private organization. Typically, it has aboard of trustees or direc- tors that is supposed to govern it andthat, in theory, is ultimately responsi- ble for its affairs. The members of its staff areprivate employees, not civil 4 THE QUASI NONGOVERNMENTALORGANIZATION servants. It is not housed in a governmentbuilding or located on federal property. Its employees are in mostinstances free from security clearance except when working onclassified government business. In theory, itde- termines its own program and carries this out asit sees fit. Frequently, it receives some, though usually limited, financial supportfrom sources other than the federal government. It may,occasionally, even extend the privi- lege of membership in itself to individualsmeeting certain qualifications, thus giving it the appearance of thevoluntary association. Lastly, as we have seen, it is legally incorporated as aprivate institution, and it enjoys tax-exempt status. But the quasi nongovernmentalorganization has other characteristics which seem to deny it a place in the traditionof voluntary associations in American life or, indeed, fully in the private sector atall. Most importantly it was created as the result of federallegislation or administrative action in Washington, rather than on the initiative ofprivate citizens. It is dependent financially for its very existence on Congress andthe particular federal de- partment, agency, or service towhich it is related. The accounts it keeps on its federal funds are examined notonly by private but also by government auditors. It may, indeed, even be subjected to asearching investigation of its books by the General AccountingOffice on the order of a member of Congress. Its most active channel ofauthority, therefore, tends to run be- tween its paid staff and aWashington bureaucracy, and its programis likely to be heavily influenced byWashington's needs, regulations, and whims of the hour. At bottom, itsfreedom of action, compared with that of a truly privateorganization, is considerably restrictedbecause the necessity for public accountability is builtinto its very nature. In the circumstances, the quasinongovernmental organization is un- likely to be able to put down a deep andvigorous root system in private soil. However fine an organization it is andhowever useful, it remains an exog- enous growth, neverentirely accepted as either truly voluntary orfully private. Reasons for Existence The existence of each type of quasinongovernmental organization has at one time oranother been seriously called into question.And yet in each in- stance there was aconvincing basic reason for its establishment.An urgent national need had been identified that noother institution in the society was meeting, or,seemingly, could meet. 5 ANNUAL REPORT FOR 1 9 6 7 In the case of the "not-for-profits," the defense establishment,