# Charity rating groups
**URL:** https://boards.straightdope.com/t/charity-rating-groups/667799
**Category:** Factual Questions
**Created:** [September 2, 2013, 2:14pm UTC](https://boards.straightdope.com/t/charity-rating-groups/667799 "2013-09-02T14:14:29Z")
**Posts on this page:** 7
**Page:** 1
### Author:  [@Chronos](https://boards.straightdope.com/u/Chronos)
#### Post date: [September 2, 2013, 2:14pm UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/1 "2013-09-02T14:14:29Z")
My mom asked me to look up a charity for her, and I’m rather confused by what I’m finding. One rating site, [Charity Navigator](http://www.charitynavigator.org/), gives them a high rating and says that 95% of their income goes to their programs. Another site, though, [the American Institute of Philanthropy](http://www.charitywatch.org/), gives the same charity a grade of F, citing among other reasons an extremely low percentage of funds going toward their programs. Clearly, someone here isn’t on the up-and-up, but I’m not sure who.
To make matters more muddled, the AIP doesn’t make their full reports available for free: You have to buy a $50 membership to read the reports. That’s a little troubling, but when you think about it, the alternative is even more so: If a charity rating site isn’t getting its funding from prospective donors, then where is it getting its funding? From the charities it’s rating?
Which, if either, of these charity rating sites is reputable? Is there any reputable charity rater that makes their information available to the public?
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### Author:  [@SandyHook](https://boards.straightdope.com/u/SandyHook)
#### Post date: [September 2, 2013, 9:40pm UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/2 "2013-09-02T21:40:00Z")
I’m giving this a bump. I’d like to see an answer myself.
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### Author:  [@Measure\_for\_Measure](https://boards.straightdope.com/u/Measure_for_Measure)
#### Post date: [September 2, 2013, 9:47pm UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/3 "2013-09-02T21:47:21Z")
Both rating organizations are reputable. There is a third run by the Better Business Bureau. Guidestar reviews a greater number of charities, but their process is more automated.
If you specify a charity that you want to evaluate (cleartext or otherwise), I will look into it and report my very humble opinion. I have access to AIP’s publications. Incidentally, they now call themselves CharityWatch. They tend to be the most aggressive of the charity rating outfits.
ETA: I believe Guidestar receives funding from those who are super-jumbo members. I assume foundations fall into that category as their fees are steeper.
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### Author:  [@Chronos](https://boards.straightdope.com/u/Chronos)
#### Post date: [September 2, 2013, 11:59pm UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/4 "2013-09-02T23:59:04Z")
Well, the specific charity that prompted the question is the Native American Heritage Association. But I’m still puzzled by how it can receive such vastly different grades from the different raters… Something must be up, there.
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### Author:  [@Wendell\_Wagner](https://boards.straightdope.com/u/Wendell_Wagner)
#### Post date: [September 3, 2013, 1:20am UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/5 "2013-09-03T01:20:35Z")
The Better Business Bureau doesn’t rate this group at all since they didn’t respond to requests for information:
[http://www.bbb.org/charity-reviews/national/native-american-heritage-association-in-black-hawk-sd-37849](http://www.bbb.org/charity-reviews/national/native-american-heritage-association-in-black-hawk-sd-37849)
The American Institute for Philanthropy says that this group counts as part of the money they use for their program services the salaries for the “disadvantaged Native Americans” who work for them as fundraisers. So if you donate to this charity, what your money is going toward is hiring disadvantaged Native Americans to work as fundraisers for the charity itself, not in any other job:
[http://www.charitywatch.org/articles/fundingfundraising.html](http://www.charitywatch.org/articles/fundingfundraising.html)
Charity Navigator rates them as O.K. because technically they are putting Native Americans to work:
> **[Charity Navigator - Rating for Native American Heritage Association](https://www.charitynavigator.org/ein/460414390)**
>
> Native American Heritage Association has earned a 4/4 Star rating on Charity Navigator. This Charitable Organization is headquartered in Front Royal, VA.
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### Author:  [@Nametag](https://boards.straightdope.com/u/Nametag)
#### Post date: [September 3, 2013, 1:45am UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/6 "2013-09-03T01:45:04Z")
Charity Navigator does not appear to question the quality of self-reported financial information from charities; Charity Watch is indeed aggressive about this. Check out the following:
[http://www.charitywatch.org/articles/fundingfundraising.html](http://www.charitywatch.org/articles/fundingfundraising.html)
[http://www.charitywatch.org/articles/inflated.html](http://www.charitywatch.org/articles/inflated.html)
[http://www.citizensalliance.org/links/pages/articles%20and%20CERA%20news/Questionable%20Indian%20Charities.htm](http://www.citizensalliance.org/links/pages/articles%20and%20CERA%20news/Questionable%20Indian%20Charities.htm)
From that last one, labeled “Scandalous in South Dakota,”
> [@](#):
>
> The couple at the helm of NAHA, Dave and Bernice Myers, were co-defendants in the Pennsylvania lawsuit against AIRC. That’s because the Myers actually created AIRC in 1990, then gave it to the board of directors who elected Brown as president. The sweetheart deal guaranteed the Myers a $10,000 “bonus for past services” and a $650,000 award for a contract to deliver future services to Native Americans. No services were ever rendered with that money. Both charities have consistently received failing marks from watchdog groups. One, the American Institute of Philanthropy, gave NRC an “F” grade and NAHA a “D” for its fundraising and service delivery performance.
>
> A former NAHA employee, Dennis Running Shield, told the newspaper Indian Country Today in 1997 that the charity only donated used goods to tribes and that Meyers asked employees to do personal errands for him, like paint his house. A closer look at the organization’s federal tax filings for 1999 shows that barely 43 percent of its funds were spent on programs and services. But even this figure is a liberal one–a considerable portion of this amount is spent on salaries, compensation and benefits for NAHA fundraisers and staff. Last year, Meyers took a salary of over $143,000 as president.
>
> Surprisingly, although NAHA and NRC’s policies may seem unethical, they’re not illegal. That’s because charities that distribute donated goods–surplus food, used clothes, textbooks–can count them as a program expense at up to market value according to current regulations. Accounting rules are unclear about how these “gifts-in-kind” should be appraised. Moreover tucking money back into charity operations by shifting fundraising overhead costs into program expenditures is a common practice and does not violate any accounting guidelines. And a 1998 statement of position from the American Institute of Certified Public Accountants allows charities to account for part of their fundraising costs as a program expense if the fundraising material has an educational bent. In this case, some charities say their solicitation pitch educates the public about the situation of poor Native Americans.
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### Author:  [@Measure\_for\_Measure](https://boards.straightdope.com/u/Measure_for_Measure)
#### Post date: [September 3, 2013, 4:48am UTC](https://boards.straightdope.com/t/charity-rating-groups/667799/7 "2013-09-03T04:48:50Z")
In Guidestar’s defense, their robo-ratings cover several times the number of charities that AIP rates. That said, AIP estimates that the Native American Heritage Association spends 42% of its revenue on programs services: their target is 60%. The cost to raise $100 is $49: their target is $35 or less. Overall, NAHA earns a D. Because AIP digs into the numbers, they can uncover such sub-par performance. (See Wendell Wagner’s elaboration.) That said, I’ve seen worse. Guidestar accepts dissembling on these numbers by various charities without adjustment. But Guidestar also makes old IRS 990 forms available free of charge, so you can adjust the figures yourself if you have a sufficiently critical eye.
American Indian organization receiving ratings of A- or above by Charitywatch include the American Indian College Fund and Futures for Children.