Monday, October 13, 2008

Change for NES

NES's Change for Charity became change of mind for the NES Board. From AC Kleinheider at the Nashville Post:

“We (NES) received feedback from customers that they prefer opt in programs, like NES’ Project Help program,” said NES CEO Decosta Jenkins. “While this new program would have provided much-needed assistance to charitable organizations in our community, we are listening to our customers and will not implement Change for Charity at the present time. NES Press Release
"At this present time" reads like we'll wait until they're not paying attention and try this at a later time. I'm glad they rethought this though. Their press release says the program allowed folks to donate "approximately 50 cents a month to charity". Of course that's just the average of rounding up. It'd been 99 cents for those folks with bills ending in .01.
In the meantime, NES encourages customers, who are able, to sign up for Project Help. One-hundred percent of the proceeds from Project Help go to pay the electric bills of needy families in our community so they can stay warm during the winter months.
100% of the voluntary donations by electric customers go to help folks stay warm vs. 80% and a 20% slush fund for NES to dole out.
Twenty percent of Change for Charity funds are available in grant form to 501(c)(3) organizations, and 80% of funds will be distributed to Metro Action Commission, Ladies of Charity, and Big Brothers of Nashville for energy assistance.
Now if we could get a few other government entities to pull their hands out of our pocketbooks.

See previous post: Increase in Rates Not Enough


Wendy said...

What no comment from NS Allen?

Kay Brooks said...


N.S. Allen said...

Well, you have to give me some time, once in a while. More pressing matters do, occasionally, keep one away from the blogosphere, after all. But I'd feel bad if I lost track of one of the only TN blogs I regularly read, so, here I am, at last.

That being said, I already noted in the original post on this topic that the outrage over the opt-in versus opt-out issue seemed overblown and silly, to me. I won't rehash that, here.

I do think it worth noting that the provision of Change for Charity's plan that would have provided 20% of its revenue for non-profit grants is hardly, on its face, a bad idea. After all, effectively, all Project Help does is funnel all of its revenue to a single non-profit of NES' choice, whereas CfC would have funneled its revenue to various non-profits of NES' choice and to the Metro Action Commission. There's not a very big difference, there, except that one program breaks up the funds into different directions, whereas the other does not.

To weigh the pros and cons of the two distribution schemes, one would have had to look at how efficiently the groups who got funding were using it. Simply observing that the recipients are fixed in one scheme and variable in the other tells us nothing about how much good each program could have done.

Wendy said...

I think I will take my money/donations to my local church who is fiscally responsible for the monies, I get to vote as a church member on how that money gets spent, and I get to choose how much money goes from my pocket to the Mercy Fund which helps individuals pay for their utility bills and food. Yes, that is being my brother's keeper in the right way and making sure that 100% of my charitable donations goes to a worthy cause, not just 20%. It is also the best way for me to build long-term relationships with the needy and/or poor and to show them mercy and love.

"He has showed you, O man, what is good. And what does the LORD require of you? To act justly and to love mercy and to walk humbly with your God."
Micah 6:7-9

Kay Brooks said...

NS: There are some really excellent blogs in Tennessee... I'm surprised I'm the the only one you read. Thanks. You might want to check: for some of the others.

You can argue about who gets the money or how much of it is put where but the bottom line is still it's not the electric company's job to take money from their customers and give it to to other customers. Their job is to make/distribute power efficiently.

Leave the charity work to individuals working in voluntary cooperation. Like Wendy, I'm part of a church that has a benevolence fund, regularly feeds the poor and aids folks in many, many ways and justifies that tax-exempt status.

N.S. Allen said...

Yeah, I've been meaning to pick up more, but it's been a slow process.

And, as I said in the original post on this topic, I actually agree that NES running a charity program probably isn't a good idea. If the government's going to look into initiatives to cut energy costs for the poor or something along those lines, I'd much rather they try to affect policy towards that end, rather than just raking in extra revenue and handing it over to a non-profit with a note that says, "You handle it."

I just think that the impact that the program would have had on the individual payer was so amazingly insignificant that the frustration with it bordered on the irrational.

I mean, just imagine that your household buys, say, jam, once a month, and the price of jam increases by 99 cents. Odds are that you aren't going to be particularly upset over this, because, even if you only make a povery-level $10,000/yr., the increase in your yearly jam expenses is only going to be, roughly, a little over a tenth of one percent of your income.

Odds are good that there will be no angry letter-writing campaign to the supermarket about this outrage. But, when the government does something like this, charges less than the 99 cents for most people, and allows everyone to easily opt out, suddenly, everyone's up in arms, even though the effect on one's annual income is either exactly the same or slightly less than the effect of the jam scenario.

So, while I agree in principle that NES running a charity program isn't a great idea, the frustration over it baffles me to nod end.

Kay Brooks said...

Have you heard the Boil a Frog analogy?

Again, you demonstrate the thinking of a person without a family. What you see as a pittance for a single guy starts to get into real money when you're going through 52 jars of jam a year. That $51.48 translates into 14 gallons of milk...almost three weeks worth of milk, or a pair of size 12 shoes for the oldest son, or...well, you get the idea.

I'll protect my right to keep my pittances and decide where they are spent. You are always free to sent NES your pittance through their Project Help.

N.S. Allen said...

Okay, I think you're taking my analogy a little too literally, here, and thereby missing the point.

To take the jam out of the equation, my point was that, if there was a private good that you paid for exactly as many times each year as your electric bill would have been rounded up by CfC, then the effect that a 99 cent price increase on that good has on your family is identical to the maximum possible effect CfC could have had on you, if you didn't opt out.

Now, obviously, whether it's $11.88 or $51.48 that a price increase adds to our yearly expenditures, and whether we're paying it to the supermarket or to NES, we'd rather have that money in our pockets than in theirs.

But the frustration directed at CfC was disproportionately greater than the frustration displayed at an identical price increase for a private good would have been, even though the harm each one does to you is the same. It's disproportionately greater, in fact, even though you're under no obligation to pay anything extra to CfC, whereas you're not going to get out of the supermarket with the private good, unless you pay the extra 99 cents.

And that is what makes no sense.