Monday, October 27, 2008

Are There Too Many Tzedaka Organizations?

In a word, yes. It is not the worthiness of all the various organizations that I'm referring to (or at least not yet), but the sheer proliferation of numbers. This time of year my mailbox is stuffed to overflowing, mostly with appeals from charitable organizations. But I've noticed that the mailbox stuffing is no longer limited to before holiday periods; it's happening every week. And it seems as if every week I receive mail from a new organization that has never contacted me before. Rabbis, some of whom I have heard of and some of whom I don't know, send personal appeals on behalf of individuals. Add to the mail received all the phone calls, meshulachim and shul appeals and the whole tzedaka process can seem overwhelming.

There's been some discussion about where donation dollars really go, and I think it's worthwhile to expand that discussion. Let's face it, you can't run a business--and tzedaka organizations are a type of business--without some overhead. Paying rent for an office costs money; supplies cost money; phones cost money; printing and mailing appeals costs money. There are going to be costs involved. But how much should those costs be? What is reasonable to assume as the cost of doing business?

There are sites that can tell you how much of the money a charitable organization uses for overhead and how much is actually given towards the cause the organization espouses. Those figures are real eye openers. Some organizations go as low as 5% as an overhead charge; others go as high as 90% going towards overhead. Whoa! Why such a difference? Can there really be such a huge difference in the running costs of Organization A to Organization B?

I just mentioned that tzedaka organizations are a type of business. Well, far too many of these organizations aren't run in a very business-like fashion. Those running them may have good intentions but haven't the foggiest idea about good business practices and money management. A lack of knowledge leads to much wastefulness. We once sent a check to an organization that was having an emergency campaign for funds to feed the needy--it took them 13 months to get around to depositing the check, which the bank would no longer honor. This organization got hit with a bank charge for the non-negotiable check and contacted us to make good on the original check plus pay the charge it incurred. My husband refused; any organization that can't get an "emergency" check deposited in less than 13 months is not a place that we trust any longer to do what they say they will do. And I had to wonder how this organization, which purportedly deals with large sums of money, didn't know about the time limits on checks. And if they "misplaced" our check, just who is running that show?

Then there is this, which we have seen in more than one organization. Those people who call you on the phone? Many are not volunteers; they are commission agents for the organization. Any donations that they can solicit they get a percentage of, and I'm not talking small percentages. Many meshulachim work in the same way; they take a percentage of what they collect as their "salary." You think you are donating money to a worthy cause? Think again.

One organization couldn't understand why I was a bit upset when I found out that they were paying multiple people salaries for running their offices. They had explained to me that these were poor people who had no other source of income so they were providing jobs for them so they wouldn't need to be a burden on other tzedaka organizations. Here was my problem with this. This organization's overhead was in the 75% range. Yes, it was nice that they were helping out people so they could have a job and not have to be recipients of a tzedaka. But this tzedaka was purportedly collecting money to help ill children. It was our original reason for donating to them to begin with. And yet only 1 out of 4 dollars we sent them was going to their stated purpose.

And then there are the "duplicate" tzedakas; organizations that are collecting funds for a purpose that other organizations are also collecting for. Does New York City, for instance, really require 50+ organizations for Hachnosas Kallah? Would not the purpose, helping poor brides in the NY frum community, be better served by having one umbrella organization for this purpose? By combining resources and thus streamlining overhead costs more money would be going towards the cause being supported. Many of these organizations are named "in memory" of someone who has died. Family and friends want a zikoron for this person. Fine, let there be a "________fund" designation within the umbrella organization.

And then there are "local" organizations, some free-standing and some branches of a larger organization. Hatzoloh is one of these organizations. My community has it's own branch of Hatzoloh. Except for widespread catastrophies, such as 9/11, our Hatzoloh serves only us. Yet, we routinely get appeals from Hatzoloh branches in other places. Why? The same goes for Tomche Shabbos. We have a branch in SI. And again, I routinely get appeals from other Tomche Shabbos groups in other areas. I look at our community, not small but not huge either, and the Brooklyn communities from where these appeals come, most of them huge, and I have to wonder why they are coming to me, particularly since they know that we have our own groups.

Should rabbanim be making widespread public appeals on behalf of an individual, who may or may not be a member of their community, but mostly isn't? I really don't want to get into that here, but I would just ask some of these rabbanim to at least change the words in the letter from appeal to appeal instead of just filling in the "name" blank with a different name. And maybe they should also change the number of children these people have--does every poor Torah scholar who has fallen on hard times, whose wife is ill or who is ill himself, have 13 children, one of whom is getting married but there is no money for the wedding? Apparently so.

There needs to be some real re-organization as regards tzedaka organizations and how they are run. Giving tzedaka is part of who we are as frum Jews, but getting fleeced shouldn't be. Accepting and encouraging poor management needs to go. At this time of year, when we have just given a cheshbon ha'nefesh, perhaps we should be asking just how much good we are really doing with some of our tzedaka giving. What is going to be needed is the cooperation of all the sub-communities within the larger frum community, and therein lies another tale.

16 comments:

Anonymously said...

One answer for why there are so many organizations is that ego gets in the way. Everyone thinks that their organization is the best and the one that the others should join with rather than the opposite being true. having a central tzedaka governing board would be one way to go but I don't think it will happen. The "owners" of the various funds have too much of themselves invested in their projects to give up control.

SuperRaizy said...

This is a wonderful, intelligent analysis of the "tzedakah problem" in our communities. I agree with anonymous above that we need some sort of umbrella organization to oversee all these charities, but that probably won't happen.

SuperRaizy said...

I've linked to your post.

SephardiLady said...

In my professional life I was trained with internal controls. So sometimes I have evil thoughts about lack of some centralization, like the ability to double, triple dip.

Toby said...

What bothers me the most is if you try and get some information directly from some of these places they clam up and tell you that their running costs are private information. We've stopped giving to any but registered tzedakas that have to file papers with the state about their expenses and where the money goes. It could be that some of the others are run well but there is no way to know.

SuMMy said...

Great post!

By my question always is- "what's the next action?" (it's from the book "Getting Things Done") What should be done about it? What step (even small) will help make this situation better.

arnie draiman said...

it is a very very very important topic that must be discussed on every blog and in every forum.

i have been preaching for over 15 years that you MUST check out the place you give to.

the most important is that the organization you have chosen for your sacred tzedakah shekels must use the money wisely, efficiently, and effectively. otherwise, you have wasted your tzedakah shekels, and maybe (just, maybe) actually done damage and not good.

two quick examples:

a) if you give $100 to the american friends of israeli purple chairs and they have an overhead of 19%, then they will send $81 over to the israeli purple chairs association. but, the IPC has their own overhead of 22%, so that only $64 of your original $100 is actually being used for what you thought.....

b) when you are not giving properly, judaism is clear: you are stealing from the poor person, since tzedakah money was never yours to begin with! (al tigzol dal, ki dal hu - (al tigzol dal kee dal hu - mishlei/proverbs 22:22 and the various comments on it, particularly bamidbar rabba 5:2)

happy to discuss this with anyone and everyone. i make a living by doing due diligence on tzedakah organizations (i represent about 15 foundations, philanthropists and tzedakah funds....)

arnie draiman
www.draimanconsulting.com

Bas~Melech said...

I have also realized that it makes little to no sense having so many different organizations... On one hand, it stands to reason because there are so many people in need that it seems impossible for one organization to support them all. On the other hand, I think it bespeaks a serious lack of cooperation among klal yisrael. While it's true, as anon said, that many people start their own organizations because they simply think they can do better than existing ones, more often it's just that there's one for every chasidus and one litvish organization for each community, as well as one major one and a few upstarts from Israel. Then there are the people who start a new organization in memory of someone special... It's time to realize that we're all in the same boat.

Anonymous said...

"Are There Too Many Tzedaka Organizations?"

Yes! Way too many.

Mark

Lion of Zion said...

SUMMY:

"What step (even small) will help make this situation better."

sounds harsh, but stop giving to any org. you are not personally familiar (OR for that matter whose goals you are not comfortable with, i.e., those involved in perpetuating poverty)

PROFK:

"Add to the mail received all the phone calls, meshulachim and shul appeals and the whole tzedaka process can seem overwhelming"

what so overwhelming? solutions:

phone calls: get caller ID and block all anon numbers. this will cut down on telemarketers (charity and otherwise) by 99%

mail: strait into the garbage/shredder

meshulahim: why do you even open the door?

"Those people who call you on the phone? Many are not volunteers; they are commission agents for the organization."

most are probably not volunteers. it's a dead giveaway when they introduce themselves as chaim but can't pronounce the ח
they also have interesting info about you, e.g., whether you are sephardic or ashkenaz (depending on which they will start with a different amount for the pledge). they are also coached on how to "sucker" you.

Lion of Zion said...

(warning: self promotion)

my most least read series of posts is on the history of jewish tzedaka orgs., starting here:

http://agmk.blogspot.com/2007/01/jewish-charity-and-hevrah-experience.html

ProfK said...

Lion,
What was particularly interesting to me in your posting on the origin and rise of hevras were the lines which stated that the hevras got very organized, had constitutions and bylaws and published the minutes of their meetings and activities. Transparency is an issue with some of today's tzedaka organizations. Those that are registered with the state have no choice but to give the state certain financial information which we can then access. Many of the organizations are not so registered. And those are the organizations that are proliferating today.

Your solution of throwing out all the mail, and not answering the door or the phone (always assuming an unlisted number--the majority of the calls to our house do not come from an unlisted number, nor have I ever been identified as ashkenazic or sefardic by one of these callers) is that it does not address the root of the problem--the lack of organization and oversight of tzedakas in our society today. That works only very short term and what is needed is something for the long term.

Lion of Zion said...

"Your solution . . . does not address the root of the problem"

no, but if more people made it a personal policy to do this then those soliciting them might be moved to improve their organizations. nothing speaks like money . . . or lack of it.

"always assuming an unlisted number--the majority of the calls to our house do not come from an unlisted number"

we are blocked to anon numbers and hardly ever get calls. when i worked in someone's home who did not restrict anon numbers, he got calls all day. that's how i came to my conclusion.

"nor have I ever been identified as ashkenazic or sefardic by one of these callers"

a classmate of mine, let's call him moyshe (his solicitation name, although his real name was igor) worked for a telemarketer who caters to jewish orgs. his boss got a percentage of the proceeds. the callers were coached on what to say and they knew information about the prospective donor before calling, incl ashk or seph. if the person had donated in the past then moyshe started his pitch by requesting the same amount again; if there was no donation history, then the initial pledge request differed depending if they were ashk or seph (it was higher for the latter)

"published the minutes of their meetings and activities. Transparency is an issue with some of today's tzedaka organizations."

i had intended to discuss this in an installment on hevrot in early american history, but never got around to it.

A Living Nadneyda said...

I'm very aware of the duplication issue from working in ped. onco -- I cannot tell you how many amutot (NPO's) there are in Israel working with children with cancer, because I don't know the answer, but my rough estimate would be: at least 20, not including the Aguda l'Milchama b'Sartan, a very large organization, and probably one of the first in Israel, which support children, adults, and the people who work with them.

I touched on the issue a little in my post here -- a lot of people start their own NPOs in honor / memory of loved ones, instead of seeking a way to honor them via an already-existing organization that fills the same need. It's a lot of work to run an NPO -- all the legal and financial mumbo-jumbo -- not to mention the overhead, as you described.

A Living Nadneyda said...

I didn't explain myself very well... what I mean is, I understand why so many people feel the need to commemorate someone.... and also, the need to give back, especially if they felt a lack when they themselves were in a position of need, and now they're trying to fill the gap. However, that feeling does not always justify creating a new NPO, with all the expenses and waste that go with it.

Your umbrella idea may be a good option for resolving this problem, although at least in Israel, we would have to resolve a big issue: The pervasive desire to be original and "reinvent the wheel" (and, typically, to get the credit for an original idea). Also, people are very hesitant to relinquish control of their NPO-baby...

Gila said...

Regarding the proliferation of organizations dealing with the same issue, I felt the same way about the approximately five zillion organizations that exist to help victims of terror. Damn, but I could take them for such a ride, if I wanted. And to think that there are so many people in this country who are in need....