Most In-Kind Programs Are Not ‘Charity Hustlers’

To the Editor:

Your March 26 issue pointed to an alarming trend in private companies running automobile and other in-kind contributions programs for non-profit organizations (“Donated Cars: a License for Abuse?”).

Many companies are profiting by abusing the tax-exempt status of legitimate charities. Charities are complicit in these arrangements, somehow convincing themselves that the “scraps from the table” of the for-profit company are enough to justify the relationship. This is a violation of their donors’ trust, and, unfortunately, greater regulation is probably necessary to curb this abuse.

We must be careful, however, not to punish legitimate operations in the process. The Boys and Girls Clubs of Metro Denver has accepted over 10,000 used vehicles as contributions since 1978. We currently spend about 40 per cent of the auto program’s gross annual revenues on program expenses — a higher expense ratio than in our other fund-raising efforts, but certainly reasonable considering the costs involved in handling approximately 1,000 cars a year.

Let’s hope that any forthcoming legislation will weed out the “charity hustlers” described in your article without destroying the viability of well-managed in-kind gift programs that preserve most of their revenues to serve the agency’s charitable mission.

Timothy J. Dougherty
Vice-President for Development
Boys and Girls Clubs of Metro Denver
Denver

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To the Editor:

All of us in the fund-raising business should be concerned about remarks made by a government official, such as those by state Sen. Patrick Johnston of California regarding “cars for charity” programs.

First, if the federal government and states would better fund non-profits, chari- ties wouldn’t have to devise “schemes” to make money.

Second, the Internal Revenue Service already has in place a “checks and balances” system for donated property: Donations above $250 need a letter.

Third, consider the fact that many states charge taxes every time a car is sold. A sales tax is paid when a car is bought, then a sales tax is paid every time it is resold — and, in most states, the tax is based on the highest blue-book listing. Sounds like a double standard to me.

I doubt that many people are taking any more advantage of the tax system than our local and federal governments. The handwriting’s on the wall. Before we know it, the government will try to do away with the entire tax-deduction system, and then where would our charities be?

Robert Christensen
Director of Institutional Advancement
Holy Name Central Catholic Junior/Senior High School
Worcester, Mass.