onePulse donors are asking for refunds but returns are unlikely, experts say
Blake Pfeil, an audio engineer who lives in Hudson Valley, New York, was strapped for cash when he donated $20 to the onePulse Foundation back in 2017.
A graduate student at the time, Pfeil said he could barely afford groceries, but he still felt compelled to help build a memorial the victims of the 2016 Pulse massacre.
“My donation was on the smaller side because at the time it was what I could afford, but it felt really important to me to donate that money,” he said. “Not just because it was such a tragic thing that happened, and I believed that the victims were owed at the very least that, but also because I have a personal history with gun violence.”
Six years later, Pfeil is among several donors who have requested refunds in the midst of onePulse Foundation withdrawing from plans to develop a museum and memorial. onePulse said requests for refunds range from $20 to $5,000.
Pfeil and other donors are likely not to get their money back from the foundation unless there are clear gift agreements that direct the return of funds if the objective associated with the gift cannot be done, according onePulse and nonprofit experts.
‘There may be nothing to return’
onePulse spokesperson Scott Bowman said the majority of the gift refunds being requested were unrestricted donations that were used for general operations, while one gift was specifically tied to the memorial and museum and was applied toward its intended purpose.
“All unrestricted gifts (i.e. not tied to any specific program or project) have been used for the ongoing initiatives and general operations of the foundation over the past six years,” Bowman said in an email. “Similarly, all restricted gifts (those expressly tied to a specific program or project) received to-date have been used appropriately and toward the donors’ specific intent.”
No refunds have been released as of Thursday but five individual donors have made inquiries, according to the organization.
Experts say while nonprofits do return funds under certain agreements, issuing refunds can be complex and it often depends on applicable state laws and terms of the donations. For those who sent unrestricted gifts like Pfeil’s, they are less likely to receive a refund if the money was already spent.
“There’s no federal law that dictates or mandates what happens with donations,” said John Trybus, a professor of social impact and nonprofit management at Georgetown University. “There can be some laws state by state — I don’t know specifically in Florida if any of those laws do exist — but the donations and contributions may have already been spent so there may be nothing to return.”
Mark Brewer, president and CEO of the Central Florida Foundation, said some refunds could be possible under certain gift agreements.
He said restrictions to gifts exists in order to hold both the organization and donor commitments to accountability, and if they do not exist, then an organization’s values or legal action drive settlements.
And in cases where funds were used appropriately but with little results, refunds on restricted donations are possible but rare, according to Brewer.
“Again, gift agreements rule here. If one is in place, calling for a refund in this case, then certainly that could happen,” he said in an email. “Keep in mind these gifts qualify the donor for a tax deduction in the year of the gift. If the donor has already taken that deduction and the money is retuned, the deduction must be backed out, which can be difficult and expensive.”
At least one state legislator is checking to see whether any state dollars issued to the onePulse Foundation can be returned.
State Rep. Anna Eskamani, D-Orlando, whose district includes the site of the 2016 massacre, said its her preference that funds allocated to the onePulse Foundation be reallocated to the city of Orlando.
She said she has contacted the Florida Department of State about more than $1 million in state appropriations issued to the charity.
onePulse acknowledged it received about $1.1 million from Florida.
According to the onePulse Foundation, a 2019 appropriation of $500,000 was designated for expenses directly tied to the museum effort, including staff expenses and capital costs. Bowman said onePulse has drawn down a little under $400,000 of the sum.
In 2020, the state approved $680,000 for general operations at the foundation. Bowman said those funds were used mostly for staff expenses.
According to Bowman, the onePulse Foundation is in talks with representatives about the $500,000 restricted funds and are waiting on next steps.
‘Bankruptcy is an option’
Heightened scrutiny of the organization follows failed negotiations with the owners of the Pulse nightclub property — one of whom is Barbara Poma, the founder and previous executive director of the onePulse Foundation who left the organization earlier this year.
Since May, people have been concerned after onePulse announced it would not purchase site from the property owners, prompting the city of Orlando to step in and purchase the nightclub for $2 million. That same week, the chairman on the Board of Trustees resigned and the board voted to end its agreement with Orange County government to build the museum, offering to return the warehouse it bought using county-issued tourism grant money.
The news prompted questions from donors and local and state government officials about the money the foundation raised, with lawmakers inquiring about launching a forensic audit.
Gene Takagi, principal at NEO Law Group and contributing publisher of the Nonprofit Law Blog, said there are cases in which it becomes impracticable or impossible for a charity to use donations for its promised purpose.
“For example, the charity may have failed to raise enough money to fulfill the promised purpose, which depended upon additional revenues,” Takagi said. “In such case, the charity may need to grant the money to another charity or public agency that can advance the same promised purpose or go to court for a cy pres ruling, which if given, may allow the charity to put the donated funds to related use even if not precisely consistent with the promised purpose.”
In situations where there are less funds remaining than the amount of refunds requested, Brewer said bankruptcy is an option, “assuming there is a gift agreement that holds the organization to specific use of the money that is not fulfilled, cash is gone and other assets remain to be liquidated.”
The Orlando Sentinel asked three institutional allies and sponsors of the nonprofit, including OneBlood, Hard Rock International and Orlando Health if the entities wish to see donated funds returned. Representatives at OneBlood and at Hard Rock International did not respond.
Lisa Maria Garza, a spokesperson for Orlando Health, said the hospital system provided a $1 million sponsorship for project construction of the memorial, museum and a walkway to connect the memorial site to the Orlando Health campus where most of the injured victims of the shooting were taken, as well as the establishment of an endowed scholarship that is health care related.
“We remain committed to support the memorial, the scholarship endowment and the memorial walkway, which will be named the Orlando Health Survivors’ Walk,” she said in an email.
Individual donors are less stoic.
Pfeil said getting his $20 donation refunded is less about the money and more about his own principles. Pfeil, who works in public media today, said he felt angered and disappointed over news that the onePulse Foundation is no longer pursuing its mission to build a museum and memorial.
“That $20 donation, while it’s probably shekels to people making six-figure salaries in executive positions at the foundation, it really meant something to me,” he said. “I’m someone who has been working in nonprofits for 15 years and I just find what they’ve done to be unconscionable.”
