The following is taken from Chester County Community Foundation’s press release:
Americans are a generous bunch, especially during the holidays. Amidst the holiday gift-giving season, there is a particular sense that we should reach further, which is perhaps why generosity to nonprofit charities peaks this time of year.
What is the scope of charitable giving?
$335 billion is donated annually, across the U.S.
$ 6.1 billion is donated by Pennsylvanians
$515 million is donated by residents of Chester County, ranking in the top 3% nationally
$2,982 is the average adult’s annual charitable giving in Chester County (higher than the statewide average, increased since last year)
There are over 1 million charities registered in the U.S., with 800 registered in Chester County alone. Charities provide vital services—arts, education, environment, health, religion, and social services—all much needed to strengthen the fabric of our community.
What’s a donor to do? How is a donor to choose from so many meaningful causes?
Of course, in this day and age, online research is plentiful. Donors seeking free unbiased data will find it at these charity watchdog websites:
www.charitynavigator.org/ rates the top 7,700 national charities
www.guidestar.org/ has data on 1.8 million IRS-recognized nonprofits, including their IRS 990 tax forms
www.charities.pa.gov/ is the PA Bureau of Charitable Organizations. The website lists @9,500 charities and 450 professional fundraisers registered with the PA Bureau.
You don’t even need internet in Pennsylvania to find charitable organization data: you can pick up your phone and talk to a real person at the Charity Bureau. Every charity that raises funds in Pennsylvania is required by law to include on its fundraising materials: “A copy of our official registration and financial information may be obtained by calling the PA Dept. of State at 1-800-732-0999.” So, try it. Call. When you phone, the Charity Bureau tells you if a charity is legally registered, if the charity is up-to-date on its filings, and what percentage of the charity’s funds are spent on program, fundraising and administration. These are good, basic starting points.
What more should donors consider?
Financial health. A charity’s IRS 990 tax form (which you can obtain online or directly from the charity for free) sheds light on the priorities and financial health of a charity. The most efficient charities generally spend 75% or more of their budget on their programs and services, and less than 25% on fundraising and administrative fees. Healthy charities grow their revenue at the rate of inflation (or more), continually invest in their programs, and have some money saved for rainy days and economic downturns.
Accountability & transparency. Charities that follow good governance and management practices are most likely to have positive program outcomes, arrived at ethically and responsibly. A charity’s IRS 990 tax form indicates whether the charity has board governance structures and policies that comply with basic best practices, whether it has conflict of interest policies in place, if it uses objective benchmarking processes to determine CEO compensation, whether it has whistleblower policies, etc. It’s all public information, filed annually on the charity’s tax form.
Attend Events & Volunteer.Donors, who are committed to advancing real change, should talk with charities to learn about their goals, challenges and accomplishments. Volunteers get to see what really goes on within an organization, and get involved as partners in the charity’s initiatives to bring about change.
Passion & Excitement. Ultimately, your giving is most satisfying when you take the time to identify what fires your passions. Give to causes that excite you, and are filled with people you trust and enjoy being with. Pay attention to your instincts, and find what brings a smile to your face as well as to others. When you give back to your community and a cause you care about, your generosity will come full circle back to you.
Chester County Community Foundation connects people who care with causes that matter, so their legacy makes a difference, now and forever. The Community Foundation helps donors to learn more about critical issues and opportunities facing the region, and discern which charities meet their criteria for giving generously and wisely. Visit the Community Foundation in the historic Lincoln Building at 28 West Market Street in West Chester, or contact at (610) 696-8211 or www.chescocf.org.
National Data Sources:
http://philanthropy.com/article/Interactive-Explore-How/149107/#state/42
http://philanthropy.com/article/Interactive-Explore-How/149107/#county/42029
