Some charities raise millions for the needy, but little actually gets to them
12:24 PM, May 7, 2013
6:06 PM, May 10, 2013
(WXYZ) - Michigan is home to some terrific charities, celebrated for being well-managed and efficient. This story isn't about them.
It's about the non-profits who raise millions for worthy causes, but spend only a fraction to help the needy.
Headquartered in Dearborn, "Cancer Support Services" has spent more $29 million in just the last three years, according to IRS records. But if you wrote them a check, you may be disappointed to learn that most of your money didn't help anyone with cancer.
Of the haul, 60 percent went to pay for things like salaries, office expenses and fundraisers.
"They are robbing money from me and from all women who need those funds to keep us alive and to keep our children alive," said breast cancer survivor Ellyn Davidson.
"It's just absolutely disgusting."
Charity Navigator's Ken Berger has been calling out what he says are America's most wasteful charities for years: charities, he says, who fail to spend at least 65 percent of expenses on charitable services. Some are here in Michigan.
"For pity's sake, stop ripping off the American public," Berger said.
Southfield-based "Good Charity" gave so little to the needy last year, you might think it's time for a name change. Less than 7 cents on the dollar went to help the needy that donors wanted to help: the cancer-stricken, terminally ill children and paralyzed veterans.
Veterans and law enforcement causes, Berger says, have proven to be a big business for many fundraising firms and bill collectors.
"This seems to be, unfortunately, the place where we see so much of this kind of rip-off behavior, wildly inefficient organizations," he said.
Donors shelled out big to Wyandotte's "Firefighters Support Services."
It spent more than $2.3 million to help burn victims and buy equipment for firefighters. But less than 28 cents of each dollar spent actually did.
Even less came from the "Law Enforcement Education Program". It collected millions to teach kids about staying safe and when to call 911. But only 3 cents of every dollar given was spent on charity.
After a month of dodging our calls, we went to visit charity director Richard Weiler. We were told he left for the day, but then we saw him sitting in at his desk. When we walked into his office, we found him hiding behind his office door.
"Where does all the money go?" asked Investigator Ross Jones.
"Enough's enough," Weiler said, before ducking out another door.
West Bloomfield's Foundation for American Veterans is another charity with high expense costs. One of its directors is former Channel 7 anchorman Rich Fisher.
The charity serves disabled and homeless vets, and donors have been generous: giving almost $6.8 million to spend last year. Almost $3.7 million to fundraisers, another $1.6 million to bill collectors and more than $300,000 paid out to salaries. It left less than a million dollars—only 15 percent—to help those it was raised for.
"It seems like the veterans, who are supposed to be the ones helped by this, are actually just getting the leftovers," Jones said.
"Well I wouldn't use the word leftovers" Fisher responded.
"They're getting 15 percent," Jones said.
"I think a million dollars can hardly be called leftovers," Fisher replied.
"Coming out of seven million," Jones said.
"Ross, if you have a better way…tell me!" he responded.
Pontiac's Grace Centers of Hope has found a better way. Nearly 83 cents of every dollar it spends goes to help homeless men, women and children in need. Last year, they helped almost 300.
"We don't' spend money we don't have, we live according to our budget, and our development team is very busy raising those dollars," said charity director Rev. Kent Clark.
And that philosophy is why Crain's magazine recently named Rev. Clark's charity as Michigan's best-run non-profit.
The Foundation for American Vets has received notoriety, too, but not the kind they'd like. For 4 straight years, a state attorney general named it one of the 20 worst charities registered in Oregon.
Fisher, who said he was unaware of the distinction, said the charity does not raise money in Oregon.