Foundation Run by Harvard’s Gates Is Revising Tax Return After Questions Raised

By Robin Fields, ProPublica

A charity headed by star Harvard University professor Henry Louis Gates Jr. is filing an amended 2007 report to the Internal Revenue Service because $11,000 it paid to foundation officers as compensation was mischaracterized as being for research grants.

Questions about Inkwell Foundation emerged over the weekend, part of a tsunami of attention Gates has received since July 16, when he was arrested at his home by a police officer responding to a report about a possible burglary in progress. The incident ignited a national debate over racial profiling, further magnified when President Obama jumped into it.

ProPublica inquired about Inkwell after receiving an e-mail from Joseph Culligan, a private investigator who makes public on his Web site documents about prominent people, from Ann Coulter to Sonia Sotomayor. The e-mail spotlighted a $10,000 grant made to Joanne Kendall, the foundation's treasurer, pointing out that she is also Gates' assistant at Harvard.

Gates, a member of ProPublica's board of directors, said Monday that the award to Kendall was actually payment for doing administrative work for Inkwell and not, as Inkwell's IRS 990 form states, a research grant.

"It should have been listed as compensation," he said in a telephone interview. In part, he added, the payment was designed to make sure she wasn't doing foundation work on Harvard's dime.
Gates also said $1,000 paid to foundation secretary Abby Wolf was for secretarial work, not research.

Inkwell was started by Gates in 2005 to support programs and research on African and African-American literature, art, history and culture.

It reported no activities until 2007, when it raised $205,543 and spent $27,600, state and federal filings show. The payments to Kendall and Wolf were among the foundation's largest — only four of 23 Inkwell grants exceeded $500.

As the foundation's president, Gates signed the report submitted to the IRS, but said he missed the inaccuracies it contained until ProPublica brought it to his attention. The foundation's accountant, David Schwartz, said he was unsure how the payments ended up being misclassified.
"If I knew why, this wouldn't have happened," he said. Schwartz said he expected the amended report to be filed in the next week or so.

As part of maintaining their tax-exempt status, foundations have to file annual reports to the IRS showing where their money goes, separating program expenses from administrative overhead.

Regulators and watchdog groups expect charities to spend more on activities that serve their core missions, but it's not unusual for administrative costs to eat up more of the budget early on.

By reclassifying the payments to Kendall and Wolf, administrative expenses will constitute almost 40 percent of Inkwell's 2007 spending instead of less than one percent.

Aside from Kendall and Wolf, others with close ties to the charity or to Gates also have received funds from Inkwell.

Gates volunteered that the foundation's second-largest grant, for $6,000, went to his fiancée, Angela DeLeon, who was also on Inkwell's board from 2005 to 2006. Gates said he recused himself from the vote on DeLeon's grant, which was for a project translating documents from Spanish and Dutch about the slave trade to Mexico.

A grant of $500 also went to Evelyn Higginbotham, chairwoman of Inkwell's board.

Higginbotham is the chairwoman of Harvard’s Department of African and African-American studies and, with Gates, edited the 2004 book "African American Lives." Gates said that, as per the foundation's bylaws, she did not vote on the grant.

Inkwell has not yet filed its 990 form for 2008 and Schwartz said it has not yet been prepared.

ProPublica is an independent, non-profit newsroom that produces investigative journalism in the public interest.

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Researchers: White Patients Benefit More Than Blacks in Surviving Surgical Complications at Teaching Hospitals

Elderly patients who undergo surgery at teaching-intensive hospitals have better survival rates than at nonteaching hospitals, but these better survival rates apparently occur in white patients, not black patients.

"We found an advantage in surgical outcomes for patients in teaching-intensive hospitals compared to nonteaching hospitals, as we had expected from other studies," says study leader Dr. Jeffrey Silber, M.D., director of the Center for Outcomes Research at The Children's Hospital of Philadelphia, and a professor at the University of Pennsylvania. "What we didn't expect was that better outcomes in teaching hospitals occurred for white patients but not for black patients."

Furthermore, he adds, the survival advantage from teaching hospitals came from lower death rates after complications (lower rates of a measurement called "failure-to-rescue"), not from lower complication rates.

The study appears in the February issue of the Archives of Surgery.

The study group analyzed Medicare claims from 4.6 million patients aged 65 to 90 admitted for general, orthopedic and vascular surgery at 3,270 acute care hospitals in the United States from 2000 to 2005. Hospitals were classified as nonteaching hospitals if they had no residents, and teaching hospitals were scaled by their ratio of residents to hospital beds.

The researchers measured mortality 30 days after surgery, in-hospital complications and failure-to-rescue, defined as the probability of death following complications. They found that compared to nonteaching hospitals, hospitals with the highest ratio of residents to beds had 15 percent lower mortality after surgery, no difference in complications, and 15 percent lower odds of death after complications (failure-to-rescue). However, these benefits were observed in white patients, not black patients. These associations were adjusted for patient illness on admission, and adjusting for income level did not change these results. Unlike whites, for black patients, the odds of death, complication and failure to rescue were similar at both teaching and nonteaching hospitals.

Silber's group did not find lower rates of complications in teaching-intensive hospitals. "Overall, the improved survival rates were not because patients were less likely to have complications, but because they were less likely to die from those complications in teaching hospitals," said Silber, who first developed failure-to-rescue as a quality of care measure more than a decade ago. The National Quality Forum subsequently adopted it as a hospital quality indicator.

Black patients displayed higher complication rates than white patients at both teaching and nonteaching hospitals, though there was no difference in complication rates between teaching and nonteaching hospitals for both black or white patients. While white patients at teaching hospitals experienced better survival rates after complications than black patients when compared to nonteaching hospitals, black patients experienced the same survival after complications at both types of hospitals. The researchers found this racial disparity existed not only across different hospitals, but also for white and black patients within the same hospitals.

"We don't yet know why these racial disparities exist in surgical outcomes, but we have some working hypotheses," says Silber. His group offers possible explanations, such as unintentional differences in communication between patients and providers. Also, in previous work, Silber and colleagues found that surgical procedures take longer for black patients than white patients in some hospitals. "That finding raised the question of whether less experienced physicians might be more often operating on black patients," he adds.

However, Silber notes, the current study relied on Medicare claims data, not on detailed medical records, so it did not provide specific information on patient care that might shed light on the reasons for the observed racial disparities. "Our findings provide a starting point for further studies of detailed patient care that might shed light on why these disparities exist and how they could be reduced."

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Study Finds Banks Less Available to Working Class, Minority Communities

A new report by the National Community Reinvestment Coalition finds that most of the largest metropolitan areas of the United States have markedly lower numbers of bank branches in working class and minority communities than in the upper class and white neighborhoods.

Are Banks on the Map? An Analysis of Bank Branch Location in Working Class Neighborhoods draws the clear connection that without access to basic banking services, modest income families spend more of their limited resources for simple financial transactions.

"Despite the purchasing power that is clearly available in urban areas, these emerging markets have been left out of the mainstream bank ing industry," says John Taylor, NCRC president and CEO. "Without banks in the neighborhood, un-banked families are paying exorbitant fees for services that are practically free for the rest of us. How can anyone climb out of poverty if they have to pay $35 to a check casher on a $585 payroll check?"

In Are Banks on the Map? NCRC surveys 25 of the largest metropolitan municipalities, including their surrounding areas (MSAs), and maps out the number of bank branches located in communities based on income-level and minority population. This report shows in 24 out of 25 MSAs, urban areas that have dense populations have fewer bank branches -- therefore fewer mainstream banking opportunities -- than the less populated suburbs. Without the ability to build relationships with the regulated banking community, working class and minority neighborhoods are more likely to use"fringe" services, such as payday lenders and pawnshops, for small loans. They are also more likely to have their home loans originated with mortgage brokers and subprime lenders, which often led to foreclosures and unmanageable monthly payments.

"There are an estimated 14 million US households that do not have regular access to bank services," says Taylor. "If banks develop and expandtheir products needed by these communities, they would be helping themselves and the people they're chartered to assist."

At the top of the list with favorable bank branch/customer ratio, San Francisco, Miami, and Boston had higher than average number of branches in minority neighborhoods, whereas Houston, New York, Los Angeles and Chicago had relatively fewer in these communities.

Based on the findings in this report, NCRC calls for more attention tobe directed to the regulated and unregulated financial services available in these communities and for the strengthening of the Service Test of the Community Reinvestment Act (CRA). CRA requires banks to meet the needs ofthe communities in which they are located. By enhancing the Service Test, the public will be able to adequately measure the number of branches in various communities to evaluate whether banks are providing the quality and quantity need in those areas.

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Black-White Life Expectancy Gap Narrows, But Remains Substantial

Reductions in the death rate from homicide, HIV disease, unintentional injuries -- and among women, heart disease -- have contributed to narrowing the life expectancy gap between blacks and whites in the United States, although substantial inequalities and challenges remain, according to a study in the March 21 issue of JAMA.

Life expectancy at birth has generally been increasing in the United States since at least the late 19th century. For as long as data have been reported by race/ethnicity, life expectancy of blacks has been lower than that of whites, according to background information in the article. Since the early 1980s, the black-white life expectancy gap increased sharply, then subsequently declined. But the causes of these changes have not been investigated.

Sam Harper, Ph.D., of McGill University, Montreal, Quebec, and colleagues conducted a study to determine the contribution of specific age groups and causes of death to changes in the black-white life expectancy gap from 1983 to 2003. They analyzed data from the U.S. National Vital Statistics System, maintained by the National Center for Health Statistics, which collects information on all deaths occurring in the United States each year.

The authors report that after widening during the late 1980s, the black-white life expectance gap has declined because of relative mortality improvements in homicide, HIV disease, unintentional injuries -- and among women, heart disease.

"For females, heart disease made by far the largest contribution to the overall life expectance gap, accounting for 1.4 years (28 percent) of the gap in 1983, 1.6 years (28 percent) in 1993, and 1.3 years (30 percent) in 2003," the authors write. "Other important causes of the 4.5-year gap in 2003 include diabetes (0.5 years), stroke (0.4 years), and perinatal death (0.4 years)."

"Among males, the largest contribution to the gap was homicide in 1983 (1.1 years) and 1993 (1.6 years), but by 2003 heart disease became the leading cause, accounting for 1.4 years (21 percent) of the overall 6.3-year gap, followed by homicide (one year), HIV (0.6 years), and perinatal death (0.4 years)," they continue.

The current difference in life expectancy at birth between blacks and whites remains substantial, 6.3 years for men and 4.5 years for women. "Homicide, HIV, and perinatal death, although demonstrating favorable trends, continue to keep the black-white gap unnecessarily large, and unfavorable mortality trends in nephritis [kidney disease] and septicemia [bloodstream infection] are currently contributing to widening the gap," the authors write.

The authors emphasize that further narrowing of the gap will require concerted efforts to address the major causes of the remaining gap.

"Reducing social and individual risk factors for major causes of death and improving access and quality of care for blacks, particularly for cardiovascular diseases, should be a pressing priority for public health and health care," they conclude.


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By This Anniversary Year, U.S. Becomes Much More Accepting of Interracial Marriage

This year marks the 40th anniversary of Loving v. Virginia, the Supreme Court case that declared states could not prohibit interracial marriage. A measure of how far U.S. attitudes have come is that when U.S. Sen. Barack Obama's interracial parents married in 1960, their marriage would have been illegal -- and he would have been considered illegitimate -- in half of all the states in America.

Prior to 1970, the overwhelming majority of all couples were same-race married couples. Couples who lived together outside of marriage, whether heterosexual or same-sex, were practically invisible. Inter-racial marriages were extremely rare. In fact, until 1967, many states in the US had laws against interracial marriage. In Virginia, for example, all nonwhite groups, including blacks, native Americans, and Asians, were prohibited from marrying whites. Even in states that never had laws against racial intermarriage, such as Illinois and New York, racial intermarriage was rare before the end of the 1960s.

Since 1970 there has been a steady increase in all types of nontraditional romantic unions. The number of same-sex couples livingtogether openly has climbed significantly, while the number of heterosexual unmarried cohabiting couples has soared, from 3.1 million in 1990 to 4.6million in 2000 to 5.2 million in 2005.

State laws prohibiting interracial marriages were finally struck down in the Supreme Court's Loving decision. Yet such marriages continued to be very uncommon well into the 1970s. In 1970, less than 2% ofmarried couples in the US were interracial. By 2005, the number of such marriages had risen almost fourfold, with interracial couples representing 7.5 percent of all married couples. Although this percentage may seem small, it is a dramatic increase over several decades, and many signs pointto it accelerating in the future, says Michael Rosenfeld of Stanford University.

Some of the rise in racial intermarriage since 1970 is due to immigration, which has increased the racial diversity of the US since 1965. Hispanics and Asians are the predominant groups among the new immigrants, and because neither Asians nor Hispanics are residentially segregated tothe extent that blacks in the US historically have been, Asians and Hispanics have substantial opportunity to socialize with members of other racial groups, says Rosenfeld, of Stanford's sociology department.

The increased numbers of these immigrants have contributed to the rise in intermarriage between Hispanics and non-Hispanic whites, and the rise in intermarriage between Asians and whites, Rosenfeld says.

The rise in black-white marriages cannot be due to immigration. One cause is improvement in race relations. Despite enduring prejudices, the post-Civil Rights era has led to more socialization between blacks and whites, and to more intermarriage. Polls show that the percentage of Americans who want interracial marriage to be illegal has declined precipitously since the early 1970s, and thereis much higher acceptance of inter-racial unions than at any time in the past 200 years.

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