OKEECHOBEE — As we move toward the annual holiday season, we all see increased opportunities in our community to give. As we get pressed for donations, there is some homework that must be done prior to making charitable donations.
Many people use the barometer of an organization’s administrative expenses versus overall income as a true measure of whether the nonprofit is doing good work. Leading charity watchdog groups warn about this “overhead myth” and caution donors to look at much more than this indicator prior to making choices for directing their donations.
Directors of the Better Business Bureau’s Wise Giving Alliance, The Charity Navigator, and GuideStar, penned a collective letter to caution that “the percent of charity expenses that go to administrative and fundraising costs – commonly referred to as ‘overhead’ – is a poor measure of a charity’s performance.”
They urge donors to look beyond measurement and direct their pre-donation research to exploring an organization’s “transparency, governance, leadership and results.” This is true for all charitable endeavors, as donors in Okeechobee have learned over the years with initiatives that have provided little result for local residents, while continuing to line the pockets of nonprofit organizations who reach into our community yet they leave no footprint.
For someone who is looking to donate there are several simple things that can be done. First, each nonprofit organization should be easily accessible by conducting an entity name search on www.sunbiz.gov. This ensures that the organization is incorporated in Florida.
The second thing that can be done is a tax exempt entity search at: https://apps.irs.gov/app/eos/ to ensure that the nonprofit has registered and obtained nonprofit status with the IRS. In this search you are able to find organizations registered or those which have had their exempt status revoked.
Third, organizations that wish to fundraise in Florida are required to register with the Department of Agriculture and Consumer Services and you can inquire about an organization’s ability to solicit funds by searching the database at: https://csapp.800helpfla.com/cspublicapp/giftgiversquery/giftgiversquery.aspx. The Department of Agriculture and Consumer Services provides extensive information regarding the rules of fundraising as well as consumer protections.
The following information is a Donor Bill of Rights which was cooperatively developed by the American Association of Fund Raising Counsel (AAFRC), the Association for Healthcare Philanthropy (AHP), the Advancement and Support of Education (CASE) and the Association of Fundraising Professionals (AFP).
Donor Bill of Rights:
PHILANTHROPY is based on voluntary action for the common good. It is a tradition of giving and sharing that is primary to the quality of life. To assure that philanthropy merits the respect and trust of the general public, and that donors and prospective donors can have full confidence in the not-for-profit organizations and causes they are asked to support, we declare that all donors have these rights:
I. To be informed of the organization’s mission, of the way the organization intends to use donated resources, and of its capacity to use donations effectively for their intended purposes.
II. To be informed of the identity of those serving on the organization’s governing board, and to expect the board to exercise prudent judgment in its stewardship responsibilities.
III. To have access to the organization’s most recent financial statements.
IV. To be assured their gifts will be used for the purposes for which they were given.
V. To receive appropriate acknowledgement and recognition.
VI. To be assured that information about their donations is handled with respect and with confidentiality to the extent provided by law.
VII. To expect that all relationships with individuals representing organizations of interest to the donor will be professional in nature.
VIII. To be informed whether those seeking donations are volunteers, employees of the organization or hired solicitors.
IX. To have the opportunity for their names to be deleted from mailing lists that an organization may intend to share.
X. To feel free to ask questions when making a donation and to receive prompt, truthful and forthright answers.
In Okeechobee, there are roughly 40 registered 501 (c)3 organizations, eight registered foundations or funds for charitable giving and nearly 25 organizations registered as nonprofit or 501 (c)3 ministries.
Local churches have a different designation, as do schools; however, donations to these entities can also be tax deductible assuming the organization has filed the appropriate paperwork with state and federal entities.
As a final caution, do your homework before you give and don’t let your tax preparer or the IRS be the one to deliver the bad news that your donation is not deductible. Reputable organizations will not mind the questions and would love to share their mission and vision prior to accepting your donation.
Leah Suarez is a freelance writer.