Where does $1 to American Homeless Vets go?
This past week, my phone rang and a woman identifying herself as “Laurie” from “American Homeless Vets” was calling to request a donation. The organization is actually the Center for American Homeless Veterans but doing business as American Homeless and Disabled Veterans (AHDV) and also known as the Association for Homeless and Disabled Veterans. Sound confusing? It is but the mission of the organization is very clear. AHDV is an advocacy organization (a non-profit 501 (c) (4)) that educates the public about homeless veterans and creating awareness of solutions to this problem. They publish, print, and distribute The Veteran’s Vision and they outreach to congress regarding the needs of homeless veterans.
As I was talking to Laurie, I brought up the organization’s website and the most recent Form 990 (2013 for the year ending September 30, 2014) filed with the IRS. The phone call ended when I realized the solicitor worked for Outreach Calling – a solicitation firm in Reno, Nevada who raised $2,088,746 for AHDV and was compensated $1,424,197 (68% of the amount collected), netting AHDV $664,509, or 32% of the amount collected. In other words, a $1 contribution made over the phone to this organization netted the charity 32 cents. The solicitation company made more money on the contribution than the charity.
The 2013 IRS Form 990 reveals the following information:
AHDV collected $2,126,709 in total revenue, of which $2,088,746 (98% of revenue) was collected by Outreach Calling. The remaining $37,963 (2% of total revenue) came from other contributions.
Expenses totalled $2,127,351, slightly more than what the organization collected. These expenses are reported to be:
- $1,424,197 or 67% of total revenue: Professional Fundraising Fees (Outreach Calling)
- $453,115 or 21% of total revenue: Other (primarily consulting: program services with no detail provided)
- $200,005 or 10% of revenue: Salaries, Benefits, and payroll taxes
- $23,046 or 1% of revenue: Legal, Accounting, Interest
- $22,544 or 1% of revenue: Office, IT, Occupancy, Insurance, Conferences, State Registration, Penalty
- $2,661: Publications
- $1,000: Grants to Individuals
- $783: Advertising and Promotion
In other words, $1 revenue was spent as follows:
-$0.67: Fees to fundraiser
-$0.21: Other expenses (primarily consulting)
-$0.10: Salaries, Benefits, and Payroll Taxes
-$0.01: Legal, Accounting, Interest
-$0.01: Office, IT, Occupancy, Insurance, Conferences, State Registration, Penalty
Based on the above information there appears to be two issues:
- The fundraising firm is taking 68 cents of every dollar collected (or 67 cents of total revenue) leaving the organization with only 32 cents. For donations to go further, donations should be made directly to the organization: Center for American Homeless Veterans, 210 East Broad Street, Suite 202, Falls Church, VA 22046
- Other expenses of $453,115 are described as consulting for program services (but the only firm paid more than $100,000 is Outreach Calling for fundraising). These expenses, which comprise 21 cents of every $1 appear to be part of the media campaign, the lobbying of congress, and the publishing, printing, and distribution of The Veterans Vision, but the specifics are not provided which raises questions.
In summary, the Center for American Homeless Veterans appears to primarily be an organization that focuses on educating the public and congress on homeless veterans and the solutions to alleviate this problem. Unfortunately, the fundraiser – Outreach Calling – retains more funds than are given to the organization.
To read the entire IRS Form 990 (2013), click here.