July 1998
Sta'iP i
■^aieigh
Carolina
VOLUME 5, ISSUE 1
A nonprofit newspaper about the nonprofit community
Look for us on the World Wide Web at http://www.pj.org
OF NORTH CAROLINA
Some charities defend high commissions
Solicitors keep 60 percent of funds raised for charity
A state regulator says donors feel
"ripped off." But charities and
solicitors say the numbers don't tell
the whole story.
By Emily Brewer
Professional solicitation firms
raised almost $58 million for charities
in North Carolina in the year ended
April 30. but charities received only
$22 million of that total.
"North Carolina is one of most
generous of all states in the republic.
but were getting ripped off and have
been for years through charitable
solicitations." says Lionel Randolph,
chief of the state’s solicitation licens
ing section.
“[The solicitors] are acting legiti
mately and legally but the public feels
they are getting ripped off when they
see that the charity is not getting
much of the money."
According to a report by
Randolph’s office, the 270 charities
that raised money in North Carolina
through professional solicitors
between May 1, 1997. and April 30.
INFORMATION, PAGE 18
• Lists of solicitors
• What to do if you're called.
1998, on average received 38.23 per
cent of those funds. Charities, kept
between none and 100 percent of the
raised funds.
Some solicitors listed on the
report raise money through telemar
keting. while others raise money
through promotions or events,
Randolph says.
In general, he says, telemarketing
Other than money
Corporate support shifting from cash
Giving by corporations to the nonprofit sector con
tinues to rise, but more of the giving is in the form
of in-kind gifts and voiunteerism.
B\ Emily Brewer
Corporate giving in the form of gifts of goods, ser
vices and volunteer time is on the rise, according to a
survey of corporations conducted by the Conference
Board.
“Noncash contributions have become an integral
component of many companies’ contributions and com
munity involvement strategies,” the report says. The
board surveyed 289 companies, representing one-
fourth of all corporate gifts in 1996.
As donations of products and services rise, cash
contributions have leveled at 1.3 percent annual
growth, the report says.
Noncash contributions accounted for 16 percent of
all corporate giving in 1994,22 percent in 1995, and 25
percent in 1996. In 1996, they totaled $600 million in tax
values and $800 million in fair-market values, the
report says.
Corporations that donate items to a public charity
for the benefit of the ill, the needy or minor children are
eligible for a tax deduction.
“Once the companies realize that they can benefit
as well as the community, they are usually very willing
to do what they can,” says Susan Corrigan, president
and chief executive officer of Gifts In Kind
International.
Gifts In Kind is one of two national organizations
that collect and distribute corporate noncash dona
tions around the country The National Association for
the Exchange of Industrial Resources was the first
such organization. It is based in Galesbui^, Ill.
“We’ve been giving $3.5 million in merchandise
through Gifts In ^d each year for four years,” says
John Connolly, the community relations manager for
the Sears Corporation in Chicago. “If they weren’t
there it would ^ much more time- and labor-intensive
on our part to identify the needs out there.”
Connolly says corporations are becoming more
aware that some products for which they no longer
have a need may be put to use by nonprofits.
The greatest needs among charities, Corrigan says,
are technology and office equipment to help them run
smoothly and efficiently.
Noncash versus in-kind contributions
The Conference Board defines noncash contribu
tions as company products (at fair market value),
donated furniture and office equipment, and property
In-kind contributions include a host of other things,
says Margaret Wethington-Arnold, manager for the
Minnesota Keystone Program, which recognizes and
encourages corporate charitable giving in the state.
According to her, in-kind giving includes the direct
Look for SUPPORT, page 16
m
mixed reviews
Member nonprofits say Gifts In Kirifs distri
bution of corporate in-kind donatkms carries
with it high shipping costs and poor service.
By Emily Brewer
Gifts In Kind International, a nonprofit that
helps corporations donate excess inventory to
charities, is taking heat from some member char
ities who say the group’s distribution system is
flawed and often Ms to help nonprofits.
While some nonprofits are happy with the
service Gifts In Kind provides, others complain of
hi^ shipping costs, difficulties receiving orders
and poor communication from Gifts In Kind
about their orders, among other problems.
Gifts In Kind says it has worked to address
problems and is channeling more donations than
ever.
Since 1983, the Alexandria, Va.-based group
has processed product donations — such as soft-
Look for GIFTS IN KIND, page 19
fundraising solicitors do not pass as
much money onto the charities as the
photography promotions and event
solicitors.
Critics say that while accurate,
the numbers in Randolph’s report
must be put in perspective. .According
to the report, for example. .North
Carolina Special Olympics received
none of the nearly $200,000 raised for
the group by the Genessee
Development & Research Group. Inc.
But the report does not say that
North Carolina Special Olympics is in
the first two vears of a five-vear-con-
tract with Genessee that guarantees
Special Olvinpics half of all funds
raised by the end of the five-year con
tract.
Keith Fishburne, president of
Special Olympics of .North Carolina,
says, "This is the Upe of fundraiser
that we have to buUd a base of sup
port. and that base of support is our
donors."
Fishburne says that at the end of
five years. Special Ohmpics will have
a base of givers in .North Carolina
Look for SOLICIT page 18
People giving more
Giving estimates are
understated, study says
Boston College researchers find
levels of giving much higher than
previously thought.
By Diana Ornitz
The estimate that charitable giv
ing in American households averaged
$696 in 1995 may be understated by
more than $300, say researchers at
the Social Welfare Research Institute
at Boston College.
Researchers Paul Schervish and
John Havens found that the average
household contribution may be as
much as $1,100 per year.
Independent Sector and the
AAFRC Trust for Philanthropy are
the leading sources of national esti
mates of charitable giving. But
Schervish and Havens say
Independent Sector’s estimates of
personal contributions to nonprofit
organizations are consistently 65
percent to 75 percent lower than the
AAFRC estimates.
Independent Sector’s estimates
are compiled by the Gallup
Organization and published every
other year in a Giving and
Volunteering in the U.S. survey The
AAFRC estimates are published
annually in Giving USA.
In a year-long study of 44 Boston
households, the Boston College
researcherrs found Americans gave
as much as 30 percent more than
their demographic counterparts in
the Independent Sector survey.
The Boston College researchers
used data from the 1995 Survey of
Consumer Finances, the 1996
General Social Survey and the 1996
Harvard Survey of Health and Life
Quality In the process, Schervish and
Havens concluded that better nation
al survey methods are needed.
Families may forget or be
unaware of the extent to which they
give each year, the researchers say.
Giving money to friends or family and
“in-kind” giving of clothing or other
products also tends to be overlooked.
This means that researcners must
conduct surveys that specifically
address such areas, Schervish says.
“We have learned an important
methodological principle,” says
Havens. “Whenever researchers
obtain information from harder-to-
interview groups such as the upper
affluent and wealthy who tend to give
more, whenever respondents are
helped to recall the details of their
giving over the past year, and when-
Look for GIVING, page 11
Journal launches
tech initiative
The Philanthropy Journal is
expanding. The Journal, which
publishes the Philanthropy
Journal of North Carolina and
Philanthropy Journal Online, this
summer vvill launch a national
newspaper and national confer
ence series, both focusing on non
profits and technology The
Journal also has changed its
name to Philanthropy News
Network. Story, page 3
INSIDE
Grants & Gifts 21
In July 22
Opinion 10
People 22
Professionai'SBrvices'..'20
1 NONPROFITS
I FOUNDATIONS
1 VOLUNTSERS
1 CORPORAL emNG
The sights and sounds of the
Internet may be a barrier to
the disabled. Can technology
meet the challenge?
Foundations are enjoying
tree Web sites - grantseekers
like it, too.
Wanted: 35,000 volunteers
as the Special Olympics
World Games come to North
Carolina
Large or small, charities
thrive with the help of
corporate sponsorships.
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\ FUNDWySIHS
A booming stock market
and increased private giving
boost funds of colleges and
universities.
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