What's an acceptable expenses:operations ratio for nonprofits supporting the military?

LTC Jason Strickland — Sat, 28 Dec 2013 09:20:07 -0500

Many nonprofits and veteran's service organizations (VSOs) have come under close scrutiny recently for having a skewed ratios of expenditures vs. costs associated with the services and the operations they provide. During the Combined Federal Campaign (CFC), these expense percentages are listed clearly. What are your thoughts on this matter?

Response by SFC Rocky Gannon made Dec 28 at 2013 9:22 AM

SFC Rocky Gannon — Sat, 28 Dec 2013 09:22:06 -0500

I believe that if any organization that wants to get money form people should be required to plainly have there ratio printed in the open for all to see.

Response by CW3 Stephen Bacon made Dec 28 at 2013 11:10 PM

CW3 Stephen Bacon — Sat, 28 Dec 2013 23:10:59 -0500

Personally, when I actively participated in CFC i looked for charities that at least 80% went to the cause.

Response by LTC David Haines made Dec 28 at 2013 11:17 PM

LTC David Haines — Sat, 28 Dec 2013 23:17:30 -0500

If an organization is a legitimate 501c3 it's Form 990 (provides financial data) should be readily available. Non-profits are required to file it to maintain their status. As to your question--I have been told by someone that has worked in the industry for a long while that an 80/20 ratio or better is the "gold standard". Having worked in non-profit for almost two years now, it should not be the only measure, and maybe not even your first. What is more important, and is difficult to express objectively is the impact or effect the organization is having on its constituents. The ratio, senior officer salary, etc. may be important indicators, but the big questions should be: Is this organization effectively fulfilling its stated mission? Are they making efforts to objectively illustrate it? Not just using anecdotal success stories and emotional testimonials. I could go on about this and efforts of some organizations to provide measures--such as non-profits claiming medical rehabilitative benefit, etc.

Response by SGT Tyler H. made Dec 29 at 2013 12:06 AM

SGT Tyler H. — Sun, 29 Dec 2013 00:06:39 -0500

It goes without saying that both good and bad (yes, even on the CFC) charities exist. Take the time to do your due diligence by researching the charities that interest you. Should you choose to donate, remember to assist only those charities of which 80% or greater of the monies go directly to supporting the said cause. Personal plug...One can never go wrong by investing in our youth.

Response by SGT Matt Gaff made Dec 29 at 2013 10:07 PM

SGT Matt Gaff — Sun, 29 Dec 2013 22:07:47 -0500

80% / 20% should only be used as a guide. I'd love to see past violations as well as well as complaints or investigation past and ongoing included. As well as if any "rumors" have been vetted as false. Education is the key!

Response by SSgt Private RallyPoint Member made Dec 30 at 2013 12:45 AM

SSgt Private RallyPoint Member — Mon, 30 Dec 2013 00:45:58 -0500

I used to run the CFC Campaign while in the Air Force (in weather) and was successful but I want to make sure that the money goes where it needs to. In that vein, I have found the projects that will best facilitate this and ALL money will go the charity.

In this case, the ALS Organization and the Shriner's Burn Hospitals. My contacts in racing and in the media will enhance our work to let people know that veterans contract ALS at a much higher rate than the civilian populace.

And I do not want any money or to necessarily establish a 501c(3) because no money will going to me. I have seen some things that I do not like and because of that, I want to make sure this is going to the right place and the right people.

This is why I am endeavoring to find as many veterans and organizations to get the word out. That includes the Patriot Guard and others to help us help the family.

My friends in Pittsburgh did a softball game to help a young cancer victim. His wish from the child was an autographed softball. Doing for others does not mean money. Sometimes that help comes from opening one's heart than just giving or donating money.

Nothing is free in this world but getting people to where they can get help, like the homeless. I know an elderly gentleman who lives in his car in Burlington, NC. He is the tip of the iceberg but he feels like a jaded veteran (Korean War) and I know a Navy guy dying of cancer but managing to be getting on.

2014 I will try to do what I can to help wherever I can.

Response by LTC Jason Strickland made Jan 2 at 2014 7:59 AM

LTC Jason Strickland — Thu, 02 Jan 2014 07:59:31 -0500

A great guide for helping you decide on which nonprofit to support is Guidestar. They serve as a watchdog for financial transparency and accountability within the nonprofit sector.

http://www.guidestar.org

GuideStar nonprofit reports and Forms 990 for donors, grantmakers and businesses

Donors, grantmakers, and businesses can all benefit from GuideStar's nonprofit reports. Search our database of more than 1.8 million IRS-recognized nonprofit organizations.

Response by CW2 Geoff Lachance made Jan 2 at 2014 10:05 PM

CW2 Geoff Lachance — Thu, 02 Jan 2014 22:05:10 -0500

80/20 is what I would want to see in a non profit organization with the 80% going to those in need!

Response by CAPT Private RallyPoint Member made Jan 3 at 2014 11:45 PM

CAPT Private RallyPoint Member — Fri, 03 Jan 2014 23:45:37 -0500

Unfortunately, by asking the question you are perpetuating the myth that an expense ratio can be a useful measure in comparing non profit organizations. Expense rations, in isolation, are meaningless, in part because no two organizations are alike, and because no two organizations account for costs in the same way. Watchdog groups can help spot fraud, but that's approaching the evaluation from the wrong end. What you want from a non profit organization is the effective delivery of programs to the intended mission. Which is better for veterans, an organization that spends $30M on fundraising in order to raise and deliver $70M in programs or an organization that spends $1M on fundraising in order to raise and delivery $9M in programs? If the two programs were of equal quality, then a sane person would conclude that the organization that raised and delivered $70M in programs did more for veterans than the one that raised and delivered $9M, despite the fact that the fundraising ratio - the most common one that is (mis)used - of the first is 30% (10% above the fabled gold standard) while the second one is 10%. Most people can get this far into the discussion, but when you add in that the money spent of fundraising by the first one went to high salaries and lavish parties, while the money spent on fundraising by the second one went to print advertising, the formerly sane people switch their position and argue that the veterans were better served by receiving $61M less in programs...

jd

Response by LTC Jason Strickland made Jan 5 at 2014 8:41 AM

LTC Jason Strickland — Sun, 05 Jan 2014 08:41:54 -0500

It is also prudent for our military community to make sure who you're donating to is a legitimate organization. Check out his article posted a couple of months ago about veteran scams: http://nypost.com/2013/11/12/the-ugly-business-of-stealing-money-meant-for-vets/

The ugly business of stealing money meant for vets

In a Cleveland courtroom Tuesday a guy named Bobby Thompson will take the stand. So, too, will John Donald Cody. The charge: stealing $100 million that people thought they were…

Response by LTC Jason Strickland made Jan 11 at 2014 8:34 AM

LTC Jason Strickland — Sat, 11 Jan 2014 08:34:32 -0500

Last week I met with the USO (http://www.uso.org) and they do a great job of pushing most of the donations directly to the troops. While many of us see the high-profile celebrity tours to where our military are stationed, that only comprises about 19% of their budget - and by far their most powerful marketing tool. The overwhelming amount of donations go directly to service members and their families.

USO

The USO is a private, nonprofit, non-partisan organization whose mission is to support the troops by providing morale, welfare and recreation-type services to our men and women in uniform.

Response by LTC Jason Strickland made Jan 12 at 2014 7:55 AM

LTC Jason Strickland — Sun, 12 Jan 2014 07:55:37 -0500

I'm humbled to report that the nonprofit I work for - Project Sanctuary (http://www.projectsanctuary.us) - had 84% of our donations head toward mission and the families that needed our services, whether directly or indirectly.

Home - Project Sanctuary

At Project Sanctuary, we believe the whole family serves, and the best way to “support the troops” is by supporting the family. We provide therapeutic retreats, enabling military families to reconnect...

Response by LTC Jason Strickland made Jan 22 at 2014 7:33 AM

LTC Jason Strickland — Wed, 22 Jan 2014 07:33:27 -0500

Project Sanctuary (http://www.projectsanctuary.us) is winding up retreat #43 where families who went ice fishing had to "kiss the fish" they caught. And, in 2013, 84% of our donations went straight to those we serve: military families!

Home - Project Sanctuary