The gift that goes awry
State report shows charities get small percent of donations
Generosity is a positive feature of the American spirit. It is the one palpable thing we can feel good about in this season of reflection and self-evaluation. I even know a man in Scotia who gives small quantities of money to more than 30 charities. It neither comes out of a large family trust fund, nor does he do it for a tax break.
Such individuals donate anonymously from a genuine sense of public spiritedness. This generous friend tries to ensure that his donations go to responsible charities. He performs some basic research about charitable organizations. It is not surprising that he finds many worthy organizations among the least-publicized ones. Many of the best on the local level operate without hiring telemarketers.
Every year The Christian Science Monitor publishes its list of the top national charities. It is a way of helping its readers distinguish between the real and the counterfeit charities. The 50 largest U.S. charities are ranked by total income. Information about total income, the percentage of total expenses spent on programs, and the salary and the benefits of the highest paid official are provided in a straightforward way. Included for each charity are ratings from three reputable watchdog agencies.
Among the top 50 national charities, fully 33 of them pay their top administrators more than $400,000 per year in compensation.
The listed salaries are enough to make the Madonna herself blink twice.
On the regional level, individuals can easily find information about what portion of their contributions actually goes to specific charities. On Dec. 21, the state Attorney General’s Office released “Pennies for Charity,” which is the annual report on telemarketing in New York state. Thirty-eight telemarketing campaigns in the Capital Region are included.
The results are a sobering indictment of public exploitation by telemarketing businesses. The report indicates that, on average, only 39.89 percent of public contributions ends up going to the charities themselves.
Locally, the report reveals that only $6,826 out of the $22,755 raised in the campaign for the Schenectady County Sheriff’s Benevolent Association went to the charity.
The Saratoga County Sheriff’s PBA did slightly better. It received 45 percent of the $37,000 raised in donations. Other revelations in the report document the fact that WMHT received 66.68 percent of $102,435. The Hunger Action Network of New York State in the Capital Region received only 55 percent of the $149,000 raised in its name. Furthermore, the New York State Troopers Benefit Fund in our area received only $109,000 out of the $409,000 raised in its name.
Some of this information makes one wonder about the leaders in these organizations who would actually sign contracts with telemarketers that are so obviously against the interests of charity donors.
I suggest two general guidelines to help separate the worthy charity from the less worthy.
First, if a charity solicits for a contribution over the telephone, it immediately disqualifies itself. A telephone call usually means a charity has cut a special deal with a marketing organization.
Second, if a charity sends more than one mail solicitation per year, this is evidence that it is spending too many of its resources on marketing operations at the expense of its programs.
Moreover, a “free gift,” such as a coin prominently displayed in a mailing envelope, or a picture of a cuddly animal, also disqualifies a charity for a contribution because it is evidence that the charity is treating potential donors as targets to be obligated or to be emotionally manipulated.
Far and away the most deserving charities most often prove to be the local ones that refuse to use telemarketers. These are often the ones that operate with the least publicity.
My friend in Scotia has a list of worthy local charities. It includes Mountain Valley Hospice, which operates in the Fulton, Montgomery and Hamilton county area. Schoharie Recovery, Inc. also impresses with its intelligent use of its limited resources. Not to be forgotten by prudent donors is the non-profit WAMC Northeast Public Radio in Albany, which does excellent regional public service work.
Although it really isn’t a charity, WAMC also organizes donation campaigns whenever a pressing human need arises. These three seem to be particularly worthy local organizations. None of them show up as employing telemarketers in the attorney general’s report.
The best compromise agreement on the national level would be to end the charitable tax deduction for all charities that use less than 85 percent of their income directly on their programs. Such a change would cripple exploitative telemarketing companies.
Another wise and reasonable idea is to end the charitable tax deduction for donors to any non-profit paying any of its administrative officials more than — let’s say — $150,000 per year.
These two provisions in the tax law would eliminate some of the incentive for self-dealing among the leadership cliques running charities. Both these provisions might also help untangle the distinction between true and counterfeit charity as well as re-emphasize the important civic idea that true charity is public service rooted in a spirit of kindness.
In any case, an across-the-board elimination of the charitable tax deduction would be a grave blow to true charity work. For now, as almost always, it is best to invest one’s generosity in the reputable smaller local charities that don’t use telemarketers. Good ones still can be found.
L.D. Davidson lives in Amsterdam and is a regular contributor to the Sunday Opinion section.