Where Do Donations to the Robin Hood Foundation Go (2018)?
The Robin Hood Foundation (RHF) is not a “rob from the rich, give to the poor” organization although RHF is known for having a wealthy Board of Directors who financially support the organization so that donations can be used to help alleviate poverty in New York City. How does RHF do this? Primarily by providing grants to other non-profits who provide food, shelter and health services along with education so that people can lift themselves out of poverty.
In a sense, RHF is a “United Way” for non-profits in New York City whose focus is on poverty. They solicit grants, screen the organizations, and disburse donations in the form of grants. Unlike United Way, the RHF states “100% of your donation goes directly to our community partners” on the front page of their website (www.robinhood.org) because “Robin Hood’s Board of Directors underwrites all operating costs.” That’s an amazing claim, especially for donors who are interested in their dollars going as far as possible to help alleviate poverty in a city where 1 in 5 people are estimated to live in poverty.
Key facts about RHF are summarized as follows, as obtained by the IRS Form 990 (2018):
RHF raised $133 million (including $12 million in non-cash gifts that were publicly traded securities) but had $199 million in expenses ($173 million in grants and $26 million in expenses), which means they spent $66 million more than they raised.
RHF awarded $173 million in grants (201 grants were greater than $5,000) primarily to other non-profits; $40 million more than the organization collected. The 13 largest grant recipients were:
- $56,415,540: UKA Facilities Foundation of NY, NY for general assistance
- $15,309,458: Single Stop USA Inc. of NY, NY for general assistance
- $ 5,000,000: New York Public Library of NY, NY for general assistance
- $ 2,480,000: Children’s Aid Society of NY, NY for general assistance
- $ 2,415,000: SCO Family of Services of Glen Cove, NY for general assistance
- $ 2,400,000: KIP New York of NY, NY for general assistance
- $ 2,150,000: Success Academy Charter Network of NY, NY for general assistance
- $ 2,112,000: Fund for the City of NY of NY, NY for general assistance
- $ 2,100,000: Research FDN of City Unv Ace Program of NY, NY for general assistance
- $ 2,085,240: Trustees of Columbia University of NY, NY for general assistance
- $ 2,000,000: Uncommon Schools Inc of NY, NY for general assistance
- $ 2,000,000: Harlem Children’s Zone Inc of NY, NY for general assistance
- $ 2,000,000: Achievement First of New Haven, CT for general assistance
The largest grant recipient was to UKA Facilities Foundation of New York (UKA) , a 501 (c) (3) whose mission “is to improve the education and education opportunities of school age children in low income communities in New York City.” Susan Sack, a director of RHF is the principal officer of UKA. In addition, Beth Solkind, CFO and Assistant Treasurer of RHF is the Treasurer of UKA; and Joanne Pressman, General Counsel and Assistant Secretary of RHF is the Secretary of UKA.
Operating costs were $26 million, most of which were compensation ($18 million) and office-related expenses ($3.5 million).
There are 135 employees who were compensated $18 million, which equates to an average compensation of $136,000 each. However, 54 individuals received more than $100,000 in compensation with the 10 most highly compensated employee the CEO, Wes Moore who received $934,078 in compensation.
There are 41 directors on the RHF according to the Form 990 (although the website shows there are 39 directors and 19 Emeritus Board members). If the 41 directors covered the $26 million in operating costs, each would have made a financial contribution of $634,000 each. If both the directors and the members of the Emeritus Board made contributions, then the 58 individuals made financial contributions of $448,000 each. The IRS Form 990 does not detail contributions so individual contributions are not verifiable.
At the beginning of the year, RHF had $334 million in net fund assets. Because the organization spent $66 million more than they raised, the net fund balance was $270 million at year end. These assets are concentrated in cash, securities, and receivables.
With hundreds of millions of dollars in savings, the question that arises is: How did the RHF save $334 million (the balance at the beginning of the year) if “100% of your donation goes to our community partners?” The answer can only be from other sources (i.e. directors) or if someone endowed the organization, or if in some years the organization didn’t spend as much as they raised (in 2012 the organization raised $217 million and spent $157 million, adding $60 million to the net fund assets, and in 2015 the organization raised $185 million and spent $157 million, adding $28 million to the net fund assets). But, again, the IRS 990 (2018) and the audited financial statements do not tell the whole story. At the end of the day, RHF still has a sizable piggy bank despite spending $66 million more than they raised in 2018.
To read the IRS Form 990 (2018), click here.