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May 17, 2020

How Revenue is Spent at Feeding America (2019)

by Anne Paddock

Established in 1988, Feeding America has been around for more than three decades and has grown substantially through the years. For the year ending, June 30, 2019, Feeding America raised $2.8 billion of which $2.6 billion (93%) were non-cash contributions (i.e. food) and about $188 million cash – from contributions ($113 million), program revenue sources ($23 million), royalties ($50 million), and other sources ($2 million). With most contributions being food for distribution to the vast network of food banks across the country, the question that most donors want to know is how the $188 million in cash revenue was spent.

The answer is this:  $89 million (47% of cash revenue) was spent on grants, $15 million (8% of cash revenue) on produce, $8 million (4% of cash revenue) was added to the general fund, and $76 million (41% of cash revenue) on organization expenses, which are broken down as follows:

  • $36 million (19% of cash revenue): Compensation
  • $ 14 million (8% of cash revenue):  Fees for Services
  • $ 10 million (5% of cash revenue):  Postage and Handling
  • $ 7 million (4% of cash revenue):  Office-related Expenses
  • $ 4 million (2% of cash revenue):  Advertising and Promotion
  • $ 3 million (2% of cash revenue):  Travel and Conferences
  • $ 2 million (1% of cash revenue):  Other Expenses

As illustrated above, the largest expense is compensation. 326 employees received $36 million in compensation which equates to an average compensation of $110,400.  The most highly compensated employee was to the former CEO, Diana Aviv who was compensated $1,084,830.  Fees for Services (non-employees) include $10 million in fees for services (unexplained) and $3.5 million to professional fundraisers. 45 independent contractors received more than $100,000 in compensation with the five largest reported to be:

  • $3,212,567:  Innerworkings of Chicago, IL for printing and production
  • $1,956,506:  Plusmedia Digital LLC of Danbury, CTfor marketing and advertising
  • $1,628,261:  The Advertising Council of New York, NY for advertising
  • $1,252,161:  Thompson, Habib, & Denison, Inc. of Lexington, MA for consult/rsch
  • $1,193,886:  Roundcorner, Inc. of San Francisco, CAfor IT CRM consulting

Office-Related expenses are primarily occupancy costs and information technology.

Using the above information, every $100 in cash revenue was spent as follows:

$100: Revenue

-$ 47:  Grants

-$  8:  Produce

-$ 55: Subtotal: Grants

 $ 45:  Revenue Remaining

-$ 19:  Compensation

-$  8:  Fees for Services

-$  5:  Postage and Handling

-$  4:  Office-related Expenses

-$  2:  Advertising and Promotion

-$  2:  Travel and Conferences

-$  1:  Other Expenses

-$ 41: Subtotal Organization Expenses (compensation, fees, P&H, office, travel, and other)

$   4:  Revenue Remaining:  To General Fund

As illustrated above, $47 out of every $100 in cash revenue was spent on grants while $15 was spent on produce.  $41 out of every $100 of cash revenue was spent on organization expenses leaving $4 out of every $100 to be allocated to the general fund, which had $108 million at year-end.

It is important to note a total of about $2.8 billion in grants were awarded to other non-profits (primarily food banks) most of which was donated food that was passed on.  About $89 million of the $188 million in cash revenue was used for grants while $15 million was used to purchase produce which was then distributed.

To read the IRS Form 990 (2018 for the year ending June 30, 2019), click here.

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