A new report from the California Attorney General's Office on charitable fundraisers shows that just over half of the money raised by commercial fundraisers last year was actually received by charitable organizations.
The report shows that commercial fundraisers in California raised $338.5 million in 2011 and 51 percent of that amount was received by the charities. In 2010, the percentage was at 44.4 percent.
The data is included in the California Department of Justice's Annual Report of the results of commercial fundraising campaigns for charities, produced by the Charitable Trusts Section.
"This report gives Californians the vital information they need to make educated choices about where to make charitable contributions this holiday season," Attorney General Harris said. "While commercial fundraisers play a role in supporting charities in California, it is important for donors to know how much of their money will be used to support the charity's programs, and how much will go to overhead."
Commercial fundraisers, organizations hired by charities to raise money on their behalf, typically charge a flat fee for their services or take a percentage of the contributions they collect. Most charities registered with the Attorney General do not use commercial fundraisers to raise funds, but do their own, in-house fundraising.
On average, $172.8 million - or 51.05 percent of the funds raised - went to the charities. The remainder was retained by the commercial fundraisers as payment for fees and expenses.
The estimated $338.5 million collected in 2011 is a decrease of $24.4 million from the year prior.
The funds raised do not include thrift store or vehicle donations.
For-profit thrift store operators that purchased goods from charities reported total revenue of approximately $80.5 million for the 2011 reporting period. Of this amount, approximately $13.2 million, or 16.37 percent, was paid to charitable organizations. Although total revenue increased from 2010 by approximately $39.6 million, the percent to charity decreased by 3.04 percent.
For-profit thrift store operators that were paid a fee or commission by charities reported total revenue of approximately $4.1 million for the 2011 reporting period, with approximately $259,000, or 6.37 percent, paid to the charities. This was an increase to charity of 1.68 percent over the 2010 figures.
Total revenue for vehicle donations was approximately $21.6 million, with the charities receiving approximately $11.6 million, or 53.8 percent, of this amount. The total revenue decreased by approximately $1.5 million from 2010, while the percent to charity increased by approximately 6.6 percent.
By law, commercial fundraisers must register with the Attorney General's office prior to fundraising in California and must file annual financial disclosure reports detailing income and expenses for each fundraising campaign.
The annual report contains an alphabetical list of charities that hired commercial fundraisers in 2011 - along with the total revenue raised in those campaigns and the dollar amount and percentage of total funds raised that went to the charity.
The Attorney General's office also publishes the Guide to Charitable Giving for Donors that provides advice, guidelines and information to help donors make informed decisions about giving. The guide suggests that donors:
1. Ask the fundraiser how a donation will be distributed. Fundraisers are required by law to tell a consumer this information.
2. Ask what percentage of donations will be used to pay for fundraising expenses. This information can better inform the consumer as to how much of the contribution will go to the cause versus overhead.
3. Ask if the fundraiser works for a commercial fundraiser and is being paid to solicit. If the answer is yes, then it is likely less of the funds are going to the charity.
4. Avoid cash donations, as cash can more easily be diverted to non-charitable purposes and there is no way to trace it.
5. Avoid giving credit card information to a telephone solicitor or in response to a telephone solicitation.
6. Learn about a charitable organization, its activities and its fundraising practices before giving. The Attorney General's office maintains a searchable online database on registered charities and registered professional fundraisers at http://rct.doj.ca.gov/MyLicenseVerification/Search.aspx. Donors can also check the websites of the Wise Giving Alliance at http://www.bbb.org/us/charity/ and the American Institute of Philanthropy at http://www.charitywatch.org/. The Guide to Charitable Giving for Donors is available online at: http://oag.ca.gov/charities/publications.