Pay it Forward?

All the talk in class about Oprah’s Big Give and the concept of changing lives, I couldn’t resist making a post about something interesting I saw on Craig’s List today.

If you’ll take a look at post ID# 611591357 , you will find a good Samaritan wanting to pay forward generous donations from strangers.  To save you the time of visiting the site I will quote:

“I am wanting to try an experiment, I am asking anyone wishing to make donations to me, I will pay it forward to those in need. I don’t know how many will respond, but I think a lot of money could be raised. Thanks for your support.”

This sounds like a good idea, but doesn’t it sound a little fish-y?  I don’t mean to be a pessimist, but I’m not going to send money to a random person on Craig’s List and hope for the best.  It does bring up another issue: do non-profits have a place on social networking sites?  I love when I see non-profits on Facebook, but where is the line?  Is Craig’s List appropriate?  Or does it only seem inappropriate because this specific link seems so… untrustworthy?

Taking Away the Tax Deduction from Donations

In some of the readings assigned in class a while ago, I noticed comments about what could/would/might happen if donations to non-profits were no longer allowed to receive a break on their taxes from donations. This made me think about the idea and I thought it might make for a good post this week.

Although I don’t fully understand why the government would take away this benefit from donating (remember I am still very new to this field), I can see why they might think it is a good idea. From my short month learning about this field, I’ve heard more stories than I should have about non-profits abusing their privileges. From what I’ve read, this seems to be the reason this idea has been kicked around. I just wanted to acknowledge that there might be a good reason for this but I disagree with taking away this specific benefit for donations.

A few years ago, my parents started donating our old clothes to the Eagle’s Nest, a donation based clothing store in town for people who can not afford to buy full priced clothing. One reason was because my sister and I were too old to give our clothes as hand-me-downs and my parents don’t exactly give their clothes as hand-me-downs to anyone. The other reason is that my mom mentioned they get a break on their taxes if they donate the clothing. This was way before I become involved in the field, but it shows that people who are not necessarily concerned with the organization are more likely to donate something (clothing, money, food, etc.) if they receive a benefit in their taxes. I think it is a good idea because it encourages donations that would otherwise never have happened.

It can also encourage donors to donate more than they would have because they are saving money. Almost everyone likes to save and earn money. By giving tax benefits to donations it not only encourages people to donate, but it can also encourage people who normally donate to donate more than they would have.

In my view, the benefits for donors of the tax deductions is a big help for the charitable organizations. I think it should continue because it helps everyone. in the chance that I might have misread what our reading assignments were saying and it might have said that the government was discussing taking away the tax deduction benefits from the actual charities then my rebuttal to that is that the costs of maintaining the charity would become too high. Charities already have a tight budget and losing their tax exempt status would cause their expenses to raise even more. (I’m going to cut this short since it’s another long post). All in all, I think tax exempt statuses and tax benefits help charities and should not be taken away even though abuses do occur.  The benefits greatly outweigh those who abuse it.

Why Such a Small Percentage??

I’m new to the non-profit sector, especially when it comes to fundraising. Our talks in class have made me think about the small percentage money from fundraisers that actually goes towards the cause. Like most people, I thought the entire amount was donated to what it was being raised for. I had no idea that such a small percentage (1% – maybe 10%) actually goes to charity. I can understand why people don’t trust fundraisers because they see that very little of their donation goes towards the cause. So my post this week is mostly me asking two questions and posing some solutions. Please feel free to add to it and correct me where I’ve misunderstood.

1. What I don’t understand, is where all the rest of the money goes? We have talked about how if a person was hired to raise the money then some of the funds go to that person. But if the fundraiser is put on by people already involved with the organization, then where does around 90% of all the money go? I understand if some of it goes towards paying for bills (electricity, water, rent/mortgage on a building, etc) or to pay for the things that went into the fundraiser (caterers, renting a building, buying food for a blood drive, etc) but if several thousand dollars are raised then I think that’s more than enough for bills. I can also understand if the money goes towards paying employees. But if the organization is small then I don’t understand. I’m an unpaid intern at the Manhattan Arts Center and the marketing/education director, secretary, and electrionics people are all part time. I also think the director is too. So if a lot of money is raised for a small non-profit then I would think more than a small percentage would go towards the cause because there are less people to pay.
What I would like to see, is non-profits posting exactly how much of the funds (dollar amount or the percentage) goes towards what. It could help donors feel better about how their money is being used. As of now, their money could be being used for anything. It could be going straight into someone’s pocket or to help the organization. Showing where the money goes could reveal money being used for bad things. I do understand that people could lie about where funds are going but I think it would be a good step forward.

2. My second question is: are there any organizations where 100% of what’s donated actually goes towards the cause? I’m going to assume that all the blood donated to the Red Cross goes to help people, even though it might not be used it’s still there for people who need it. I’m wondering about fund raisers that just raise money. In my point of view, I can’t see why every organization has at least one fundraiser a year has all of its funds (100%) go straight to the cause. If the organization is honest about where all the money goes on its other fundraisers then this one would help with donor relations. Donors might be more likely to donate to this fundraiser because they know their money will actually help the cause. I would be more likely to donate if I knew that all of my donation goes to where I intended it to go.