Report Tracks How Oregon Charities Spend

Article excerpt

Byline: Susan Palmer The Register-Guard

A new report on charities doing business in Oregon warns donors to do some research before agreeing to give any money.

Produced by the Oregon Department of Justice, the annual report highlights charities that spend too much on fundraising activities and too little on their mission, whether it's cancer research or helping find missing children.

Thanks to the Internet and at least three national watchdog groups that rate charities, it's easier than ever to get helpful information, said Victoria Cox, spokeswoman for the state Department of Justice's Charitable Activities section.

The Better Business Bureau, The American Institute of Philanthropy, and Charity Navigator all use different ranking systems to indicate how effectively nonprofit groups fulfill their mission. The new state report describes how each group makes its evaluations.

For people who don't want to spend a lot of time assessing a charity, the letter grade provided by AIP or the zero- to four-star ranking of Charity Navigator are easy to understand, Cox said.

Not everyone wants to make that effort. For those people, groups such as The United Way are a good option because they've already vetted the charities they support, Cox said.

But in recent years, more people want to do the research themselves, she said.

"Young people especially are more interested in being involved personally with the decision, and they're not afraid of using the Internet," she said.

The big challenge is finding good information on state or regional charities that aren't evaluated on the watchdog Web sites, which focus mainly on national nonprofits, Cox said.

Another organization, Guidestar, provides Internet access to the federal tax returns of almost all the nation's charities. The returns provide the raw data other groups use to make their analyses, Cox said. It takes a little more time to read them, but anyone can do it, she said.

Among the important things to consider in evaluating a charity is what percentage of its income goes to supporting its programs. The Department of Justice recommends that at least 65 percent of a charity's money goes directly to its programs, Cox said.

The state report lists 29 charities, 24 that have received low ratings from two of the three watchdog groups and five that are highly rated for comparison.

Among those toward the bottom of the scale, the percentage of money going to mission-specific programs ranged from just 20 percent for The Interfaith Alliance down to 8.9 percent for the American Breast Cancer Foundation.

Aside from their questionable financial practices, some of the charities pose another challenge to potential donors. They have names similar to more effective organizations.

Without checking, for example, it would be hard to tell the difference between the F-rated American Breast Cancer Foundation and the A-rated Breast Cancer Foundation, or the B+ rated National Center for Missing and Exploited Children and the F-rated Operation Lookout National Center for Missing Youth. …