Saturday, February 24, 2018
Business

How we identified America's 50 worst charities

 

The United States is home to roughly 1.6 million tax-exempt organizations.

That's far too many to examine closely. So the Tampa Bay Times and The Center for Investigative Reporting used data collected by the nonprofit charity tracker GuideStar USA to narrow the pool to the 5,800 charities nationwide that report paying professional solicitation companies to raise donations.

We focused on these charities because relying heavily on for-profit fundraisers is one of the most inefficient ways to collect donations. Regulators and industry experts widely consider the practice a red flag for bad charities.

To tell the stories of America's worst charities, reporters started in California, Florida and New York, the largest states that require charities to disclose the results of their professional fundraising campaigns.

These states capture the fundraising activities of thousands of charities across the country, and in many cases record the donations raised and the cash paid to fundraisers in every state where a charity solicits donations.

Reporters zeroed in on charities that consistently kept less than 33 cents of every dollar donated. Watchdogs generally flag charities as wasteful if they keep less than 65 cents of every dollar raised.

The Times and CIR then looked back at a decade of IRS tax filings to identify and rank the 50 worst charities based on which groups paid the most to their fundraisers over that time.

One or two costly fundraising campaigns were not enough to make the list. Charities had to pay fundraisers the lion's share of money raised in at least 75 percent of all campaigns over the years.

In addition, the Times and CIR excluded charities that ran fewer than five campaigns, got half their cash revenue from other sources or had revenue under $200,000. The reporters also calculated the cash each charity spent on direct cash aid.

The Times and CIR counted money given directly to individuals or passed on to independent charities as grants.

Grants given to a charity related to the original organization were not counted. Neither were donated items or the costs of educational campaigns. Both can be legitimate forms of charity, but they are easily manipulated to mask fundraising costs.

The data has limitations.

After facing criticism for high fundraising costs year after year, charities and fundraisers have learned how to hide the costs of telemarketing and direct mail. Some have obscured costs by reporting mailing expenses and other fees separately. Others run their own telemarketing operations in-house.

Some of the charities' IRS filings were incomplete or had not been filed. Others contained obvious errors that sometimes could not be clarified.

The Times and CIR had three experts review the methodology for identifying the 50 worst charities. All of them, including Chuck McLean, vice president of research for Guidestar; Robert Tigner, general counsel of the Association of Direct Response Fundraising Counsel; and Putnam Barber, a nonprofit expert at the University of Washington, said the methodology was sound.

In addition to identifying the nation's worst charities, the Times and CIR used public records requests to compile the first nationwide database of state regulatory actions against charities and their professional fundraisers. The data, available at tampabay.com/charity, contains some 8,000 actions from more than 35 states.

Some disciplinary actions may be missing. Fifteen states provided no information; 24 states directed reporters to press release archives that may not have been comprehensive.

Comments
Activists call for tech companies to drop NRA’s digital TV channel

Activists call for tech companies to drop NRA’s digital TV channel

Activists are calling for Apple, Amazon, Google and other streaming companies to drop the National Rifle Association’s digital TV channel in the wake of the mass shooting at a Florida school last week, putting the companies in the delicate position o...
Updated: 1 hour ago
Edward Peachey demands severance from CareerSource before stepping down

Edward Peachey demands severance from CareerSource before stepping down

The head of the Pinellas and Hillsborough career centers under multiple investigations into the way they report job placement figures says he has no intention of stepping down.That’s unless he is paid five months severance.In a letter from his attorn...
Published: 02/23/18
Terminally ill Valrico man dies a month after marrying junior high sweetheart

Terminally ill Valrico man dies a month after marrying junior high sweetheart

VALRICO — During his final few days, 19-year-old Dustin Snyder moved to a hospice house, surrounded himself with belongings from home, swam in a pool and visited the beach in Ruskin.Wherever he went, the terminally ill Valrico man had family beside h...
Published: 02/23/18
Tampa Downtown Partnership gets initial city okay to expand north

Tampa Downtown Partnership gets initial city okay to expand north

TAMPA — The Downtowner may be heading to Tampa Heights — but not until Oct. 1.That’s because the nonprofit Tampa Downtown Partnership this week won initial City Council approval to expand into Tampa Heights."Tampa Heights is becoming an important gat...
Published: 02/23/18

Tampa lawyer gets 27 months in federal prison for insider trading

Tampa lawyer Walter "Chet’’ Little was sentenced this week to 27 months in federal prison for engaging in an insider trading scheme that reaped him and a friend profits totaling nearly $1 million.According to federal authorities, Little accessed comp...
Published: 02/23/18
More companies are cutting ties with gun lobby as #BoycottNRA movement gains steam

More companies are cutting ties with gun lobby as #BoycottNRA movement gains steam

Three major companies — Enterprise Holdings, First National Bank of Omaha, and the cybersecurity giant Symantec — have ended co-branding partnerships with the National Rifle Association as a #BoycottNRA social media movement picks up steam.Enterprise...
Published: 02/23/18
Citi to refund $330 Million to credit card customers it overcharged

Citi to refund $330 Million to credit card customers it overcharged

Citigroup is preparing to issue $330 million in refunds after the bank discovered it had overcharged nearly 2 million credit card customers on their annual interest rates, a spokeswoman said Friday.The bank, which has about 150 million credit card ac...
Published: 02/23/18
Girl Scouts camp sold to member of Tampa’s Lykes family

Girl Scouts camp sold to member of Tampa’s Lykes family

ODESSA — The 63-year-old lakeside summer camp had no air conditioning or electricity. Cabin floors were often covered in grime, and cobwebs clung to the windows.But under new ownership, the 18.6 acres of Florida woods known as Camp Scoutcrest to memb...
Published: 02/23/18
BB&T cites ‘technical issue’ in outage affecting customers

BB&T cites ‘technical issue’ in outage affecting customers

Millions of BB&T customers were unable to access their accounts after a service outage which the bank blames on an equipment malfunction. The Winston-Salem, North Carolina-based bank posted a statement on its Twitter page saying the problem persiste...
Published: 02/23/18
Realtors are ‘every 10 feet’ in Florida but more want in the business

Realtors are ‘every 10 feet’ in Florida but more want in the business

ST. PETERSBURG — Tired of working as a yacht captain, Pancho Jiminez decided to get into real estate even though he knows it’s a highly competitive field in Florida."Realtors are every 10 feet around here," he says.Nonetheless, Jiminez is among 30 st...
Published: 02/23/18