In the past, the United Way has had some issues with misspending money.
However, I’ve heard there were reforms.
I wanted to donate a small sum.
The local United Way organization claims that last year, 87% of call money donate went to the causes.
Will the United Way misspend donations?
I hope United Way doesn’t mean that 87% of all the money it gets is redistributed to its various “members” and then they, too, remove some portion as operating expenses. Why not give directly to whatever charity within United Way you want to support and skip the middle man?
United Way will waste most of your donation, find a charity you like and give directly.
From a thread back in 2006: [POST=7798861]“Sending an evelope full of cash care of Donald Trump ‘to use as you best see fit’ would have about equal merit.”[/POST]
Despite events in the intervening period, I feel essentially the same.
Fuck the United Way. Give directly to an animal shelter, domestic abuse charity, the Southern Poverty Law Center, or Elizabeth Warren’s election campaign. Anything but the United Way.
Stranger
There’s always the SFCS. Funding cool stuff for Squirrels is a worthwhile endeavor, if I say so myself. And I do.
Moderator Note
That other thread dates back to 2006 (and is a Pit thread anyway). The OP notes that there have been reforms since then so that thread probably isn’t relevant today.
Since the OP put this in GQ, I assume we’re looking for independent verification that the funds given actually go to worthy causes, instead of just taking United Way’s word for it. Hopefully someone can find a cite somewhere which either proves or disproves United Way’s claims. Let’s try to avoid opinions until we get some sort of factual answer.
If we don’t get a factual answer in a reasonable amount of time, I’ll kick this over to IMHO to let folks speculate and give opinions.
ETA: If the OP would prefer a move to IMHO before then, just let us know.
Factual answers are not possible unless the OP identifies the specific United Way chapter that he’s referring to.
It also varies by local agency. Check out your local organization’s website for info on the breakdown. For example, the Albany, NY agency show 17% of expenses going to management and fundraising costs. But 36% goes to other agencies, and they have overhead costs as well.
As other suggested, giving directly to a non-profit may be the better way to go.
Okay, factual answers: United Way Worldwide, the former United Way America and umbrella to individual United Way chapters, is surprisingly opaque for a 501(c)(3) nonprofit organization, but here is their IRS form 990 for 2015 detailing revenues, expenses, and assets (Part XIII, IX, and X respectively, pages 9-11). Part XII (page 8) shows executive compensation with President and CEO Brian Gallagher reporting nearly $1.3M in total compensation, and all senior officers making comfortable mid-six-figure incomes. I haven’t totalled up income versus distributions and expenses but it certainly doesn’t look very favorable, especially for an organization that is essentially a fundraising body that does not provide any charitable services itself. It is largely the local chapters that distribute money to specific charities in need, and they often have a very poor reputation for dealing with genuine charities with an institutional bias toward funding only established charities which already have large funds and payrolls. As many charity supporters and volunteers can tell you, the United Way often places a number of restrictions on how money can be spent, encouraging irresponsible use of funds in order to meet their guidelines, and from what I have heard this hasn’t actually changed much since the scandals of the early 'Nineties even with the turnover in executive officers and staff.
Want to make sure that the bulk of your dollar actually goes to helping people in need or services you want to support? Donate directly to a charity. It’s just as easy and you won’t be paying for a bunch of useless middlemen who are essentially the check cashing shop of the charitable donations world.
Stranger
Yes. One chapter and another can operate differently. Some of them have administrative costs independently covered and a very high percentage of the donations are delivered to charitable causes.
However, that doesn’t mean the money is spent wisely or proportionally based on need. Pick worthy causes yourself and give the money directly. You can also look at local Community Foundations. They often provided better service and allow you to select exactly where your money is going and will provide oversight to make sure that your selected charity is spending the money properly. But you still have to make sure the particular Community Foundation is doing their job well.
In general stay away from organizations that use any of your money for operational costs. It should all go to directly to the charitable cause.
Personally, I think United Way is useful in that encourages people who would otherwise not think of giving to give. I strongly suspect (just an opinion here) that many charities get more than they would in UW did not exist.
However, if you care enough to ask a question on this forum you could likely find a charity that you care about and give directly.
Or, to reframe, the United Way encourages employers to goad, pressure, and harass employees to donate so that it can distribute money to charities that frequently do less to serve their ostensible causes and they do their officers. “Giving to charity” is a good thing when the money is used to improve the lives and well-being of the intended recipients. When it just enriches bloated and self-serving “non-profit” executives, you might as well just burn your money to provide heating for the poor and indigent because at least it will provide some slightly useful function.
Stranger
For a charity as large as UW, 87% is not impressive. It should be over 90%.
UW has been racked with scandal. You can start with the Chairman entertaining his 17 year old girlfriend in luxury on the UW dime.
87% for a much smaller charity might be excellent. Economy of scale comes into play for administrative costs.
My personal philosophy as to charitable giving is “one strike and you are out.” There are plenty of charitable organizations out there that are doing wonderful things efficiently and effectively. You have to do your homework. Don’t stop giving.
United Way is off my list forever. (So is the Red Cross.)
The United Way Of Rutherford & Cannon Counties.
You can find their financial statements here. According to my reading of the chapter’s financial statement for the year ending 6/30/2016, their total expenses were $3,126,133. Of that $2,146,821 when to “Agency allocations” which I interpret as the amount going to other non-profits’ programs, which would be 66.8%.
Of the 3,142,152 in contributions and grants, $598,180 went to “salaries, other compensation, employee benefits”. That seems like a very large percentage.
I’m confused – do charities like that exist? How?
Most reputable charities spend 90% or more of their funding on charitable services provided (including functional assets, provisions, transportation, et cetera) rather than administrative overhead, e.g. executive salaries, administrative facilities and costs, et cetera. The United Way is, collectively, essentially a fundraising organization that does not provide any chariable services; it provides dispersements to individual charities through its regional and local operating units which are separate 501(3)© entities, each with their own executive and administrative staffs. In essence, the entire United Way organization is basically a ‘wheat tax’ on charitable donations, existing solely to provide a conduit for donations to get to charities. Now, if it were efficient and effective at this it could be viewed as a necessary fundraising function, and promotion and fundraising is not an easy task. However, as anyone who has dealt with the United Way can attest, there is substantial waste and frequently outright fraud, and the strictures the United Way puts on how monies can be spent or who can receive them contributes to a culture of waste and abuse. The American Red Cross (distinct from the International Red Cross) has similar problems. It can be argued that without the United Way none of this money would make its way to charity, but when the resulting dispersements that actually make it to charity are a trickle of the original torrent, it is difficult to accept that theory as being valid or useful as the execs at these “non-profits” enrich themselves upon the hard-earned donations of donors whil believe they are making good use of their hard-earned money.
Stranger
I can’t post here about UW because my post would belong in IMHO.
But my advice find a charity that deals with something that you are passionate about.
A lot of charities are small-time affairs who raise less than a million a year for local causes, however it’s incredibly easy to simply create your own charity and while you’re supposedly donating the money to a good cause most of the money goes to giving yourself a full-time salary completely over-inflated compared to how much you actually get donated.
Two charities I saw news stories on recently, one was National Vietnam Veterans Foundation which was making six million a year in donations except only 2% of that went into actual charity, the rest was all paying the founder/CEO and his board of directions six figure salaries. Another was a charity founded to help transgender people find support groups and other help in their areas, except 90% of the money went into giving the founder and their significant other full-time salaries (despite the charity only pulling in around $100,000 a year) and the actual volunteers who did all the work were completely unpaid (and untrained to boot since no money was allocated to training)