Private companies that solicit on behalf of charitable organizations often do well by doing good – but recent research makes it clear they don’t always do enough good.
A report from the office of Secretary of State Gigi Dennis showed that private solicitors who did telemarketing, direct mail and radio ads to raise money for Colorado charities and other nonprofit organizations in 2005 kept more than half of what was collected. That is, only 47.5 percent of contributions raised through such solicitations actually went to charities.
That’s a disturbing figure that has the potential to discourage people from giving. It’s worth keeping in mind during this season of gift-giving, but it’s also worth keeping in perspective.
Charley Shimanski, president and chief executive of the Colorado Nonprofit Association, says that solicitations by private firms make up less than 10 percent of all charitable giving in Colorado. Ninety percent of charitable fundraising is done by charities themselves, which funnel most, if not all, of the donations into charitable work, not administration.
Overall charitable donations in Colorado total about $2.4 billion a year. Those collected by hired solicitors amounted to $164 million through November of this year.
The purpose of last week’s report was to provide information to consumers who are considering making contributions and to charities considering hiring paid solicitors.
The annual report tends to focus on the commissions collected by hired solicitors and not on the fact that their efforts comprise a small portion of overall charitable giving in Colorado.
The lesson here is for potential donors to ask questions before giving money.
Shimanski said there are times when hiring a private solicitor is worthwhile, despite the hefty commissions. Some nonprofits have no staff to organize or carry out fundraising campaigns. Without the high-priced help, they have little chance of raising money for critical needs.
The Alpine Rescue Team, a nationally accredited mountain rescue group based in Evergreen, is a case in point. The all-volunteer team conducts close to 100 search missions a year. Several years ago, the group hired a solicitor to raise money for an emergency shelter. It took a year, and a hefty charge, but enough donations came in to build the facility. For the rescue group, paying a solicitor was worth it, Shimanski said. Donors need to ask and decide for themselves.
“Remember that most charities are doing great work, are deserving of our support, and rely upon your donations to fund their activities,” Secretary of State Dennis said.
