What’s On Your Charitable BOLO List?

Part of the recent scandal surrounding the IRS’s Exempt Organizations office was its use of BOLO (“Be on the Lookout”) lists. IRS staffers used the lists to screen groups applying for tax-exempt status based on certain phrases and criteria. Groups that didn’t make it through the screen were subjected to longer and deeper reviews (see the Treasury Inspector General’s report here).

I’ll leave arguments about the appropriateness of the IRS’s processes and staff to others. But, the screening process and lists got me wondering about my grantmaking and philanthropoid peers: “What’s on your charitable BOLO list?”

Foundations and other grantmakers often have public guidelines that describe their priorities. At their best, the guidelines provide clear signals about how inquiries and proposals might be screened. In too few cases, they may even meet nonprofits’ hopes for transparency as recently reported by the Center for Effective Philanthropy.

The Treasury Inspector General’s report described BOLOs as an internal “shorthand way of referring to a group of cases.” I’m likely confirming the suspicions of nonprofit leaders everywhere: grantmakers have BOLOs too, even if unwritten or not labeled as such.

At their most benign, these short-hand BOLO lists are a way to streamline internal communications, e.g. “the founder’s favorites,” “the grantees from initiative X,” or “groups using evidence-based practices.” The lists might signal shorter due diligence processes or a shared sense of internal trust.

At their most constructive, the BOLOs are a means of prompting increased due diligence to better understand how the grantmaker can be most helpful, e.g. “groups that have cashflow problems” or “groups going through executive transition.”

At their most troublesome, the BOLOs can prevent good ideas and organizations from receiving fair consideration. The lists become an automatic gatekeeping mechanism that might not accurately describe the diversity of opinions and interests you’d expect from a group of people at an grantmaking organization. In my work with and around grantmaking groups over time, I’ve witnessed* BOLOs such as:

  • Thresholds around overhead ratios or other financial ratios that don’t take into account the variety of business models and stages of organizational growth
  • Expectations about board composition or behavior that may not fit the cultural norms of an ethnic group or community or 21st century, networked practices
  • Expectations of particular personality traits of nonprofit CEO
  • Groups of nonprofits that are deemed “too small” or “too large” to be effective
  • Nonprofits’ policy or advocacy work unnecessarily preventing them from receiving consideration for program support

My Take

Grantmaker staff and board members, like all people, carry biases, experiences, and relationships that influence their perspectives on their work and on their potential customers. We’re all human – it’s impossible to avoid these influences completely. I suspect BOLOs exist in nonprofits as well – “clients that are abusing the system,” “ticket buyers that will never convert to donors,” “those irresponsible parents from that neighborhood,” etc.

Board, grantmaking committee, and staff members of grantmakers need to uncover and discuss our BOLOs on an ongoing basis, even if they seem benign or useful. I encourage new members to be brave enough to ask about them – to BOLO for BOLOs if you will. And, veterans (myself included) have to challenge ourselves not to let cynicism and years of work create accidental BOLOs. My grantmaker mentors cautioned me always to question my own assumptions and biases before talking with a nonprofit or reading a proposal. I know I haven’t succeeded 100% of the time on this. But I’m willing to dig deeper to ensure any short-hand lists don’t get in the way of my being open to ideas that come my way.

So, what are the BOLOs, even unwritten, at your grantmaking shop? And, what are you going to do about them?


* DISCLAIMER: The examples are not and should not be interpreted as the views of my current or past employers or consulting clients. That said, ask me sometime about a former BOLO regarding audacious ideas mounted on foam core.