April 24, 2008
Congress Considers Requiring Charities to File Fund-Raising Details With Postal Service
By Elizabeth Schwinn
Washington
Lawmakers who want to discourage charities from spending most of the money they bring in on fund-raising costs are considering introducing legislation to require nonprofit groups to post information for donors to a Postal Service Web site, including the ratio of their fund-raising costs to program spending.
During a House subcommittee hearing today on an obscure postal rule, Rep. Danny K. Davis — chairman of the House Subcommittee on the Federal Workforce, Postal Service, and the District of Columbia — pointed out that under current law nonprofit organizations are not required to disclose much information to their donors. A central database with information on all charities would provide potential donors with the information they would need to make informed decisions on which charities to support, he said.
Rep. Henry Waxman, a California Democrat who oversaw recent hearings on veterans charities as chairman of the House Committee on Oversight and Government Reform, agreed.
Mr. Waxman cited the case of Roger Chapin, founder of Help Hospitalized Veterans, a Winchester, Calif., charity that the committee found spent $500,000 on salaries for Mr. Chapin and his wife, and $444,600 for a Northen Virginia condominium used by the couple.
“Donors don’t know where to get the information about these charities,” Mr. Waxman said. “They don’t know that Mr. Chapin’s organization spent only 25 cents per dollar on programs, with the rest going to fund-raising.”
Mr. Chapin has denied any wrongdoing, and said that he depended on professional companies that charge high fees to solicit donations.
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Can these guys not read a Form 990? You know, that big section called “PROGRAM SERVICES” that shows how much is spent on actual actual programs. Oh, I see it’s Henry Waxman that is involved. He probably really can’t read a Form 990.
jcampbell@visionstrategygroup.com
— Jamey Campbell Apr 25, 03:55 PM #
The public has a right to now where their money is going and who can help them if they are a hospitalized veteran. We have a right to have accessible information about charities. This is another causaulty of big media-they do not give communities the information we need to make informed decisions about seeking services or giving. I think that it’s very hard for smaller organizations to take on these reporting requirements and so I suggest not putting requirements in place that are ineffective and costly to organizations that are honest and hardworking. If the public doesn’t look at 990’s why would they look at the Postal Service website? I think the media could do more work in this area. And also, if there was a way for people that are supposed to be helped by these organizations to know they exist. I think they would also have a vested interest in keeping charities like this accountable. The worst part is that the Help Hospitalized Veterans exploited donors on the backs of veterans, many of which could use the work they said they were doing on their behalf.
— Ellen Apr 25, 05:38 PM #
“Program Services”? Take another look at what is being categorized as Program Services — if you can dig deep enough and get your hands on the audited report footnotes. The 990 needs to be updated. It is way too vague.
— Ray Apr 25, 09:09 PM #
There seems to be two different issues here that the Congressmen are ignoring. One is due diligence and the other is accessible public documents.
In our society there is an assumption that the consumer will exercise due diligence. If the information is available and the consumer chooses not to use it, it is not the seller’s responsibility. Conversely, if the seller (the non-profit agency) presents a distorted picture through fabrication or fraud on public documents, the seller needs to be held accountable.
As to accessible public information, there are current efforts to accomplish through the likes of GuideStar and rating agencies. Adding the Post Office website is not going to solve the problem unless the government and the Post Office is willing to engage in a consumer education program to make people aware of where this information can be found. Nothing in their current comments or historic patterns, suggest that Congress will do this.
John C McGee
Woodstock, GA
— John C McGee Apr 28, 10:14 AM #
Such irony… suggesting that the information be posted at a US Post Office Website. THE SINGLE LARGEST COST OF FUNDRAISING — ABOUT 30 PERCENT OF THE TOTAL — IS POSTAGE!
Fundraising via mail IS expensive. But it’s the only way to effectively inform prospective donors in New York or California of the important work that a group in Michigan or Texas is doing.
And the single-sighted focus on fundraising efficiency completely overlooks whether a non-profit is making meaningful differences to our Nation and our people.
Let’s focus more on the results and less on costs alone.
— Bill Apr 28, 02:56 PM #