Look closer at Charity ratios
I'm writing about the article on overhead to program ratios in the
], and the issues with this measure that you really didn't raise in the article.
I'm not personally familiar with any of the charities you list, so I'm not making any claims about whether they are or are not "underperforming," but you can't tell that from this ratio.
Simply taking the ratio of administrative to program costs is going to give "better" results for charities that have large program costs—usually groups who give a lot of "stuff" away. If the work of the organization is almost entirely organizing and administering volunteer programs, then the ratio of admin to program costs is going to be high because running the program doesn't cost very much.
Imagine, if you will, a nonprofit that does nothing except support a volunteer service. They may actually have no program costs, and be 100 percent administrative, but that doesn't mean what they are doing is less worthwhile than an organization that takes in large amounts of donations and gives all of it away in ways that are poorly targeted.
The key is to understand what the organization is spending money on, and decide if they are getting good value for that money. A straight ratio tells you very little, and to call charities "flabby" based only on this metric is misleading.
—Nick Macdonald, Portland
Who Are you calling “flabby”?
Shame on you,
I was disappointed with your unflattering piece about p:ear ["Flabby Charities," Dec. 22, 2010], using figures that seemed to indicate poor usage of funds. Without unbiased investigative reporting, this could appear to be the case.
However, at the time the figures were gathered, p:ear was closed for many months after losing its lease to urban development. During this time, fundraising continued, but program expenditures were obviously not made, so the books showed gains without program expenses. Also, p:ear is unique since the administrators are the teachers, a fact not considered in the reporter's calculations.
It violates common sense to hurt the fundraising efforts of a program that is doing amazing work in your community during the most important fundraising week of the year, especially one that has been vetted for inclusion in your own Give!Guide! According to their literature, over 700 youth spent over 20,000 hours inside p:ear's doors last year. Perhaps you'd rather have them sitting on your door stoop?
P:ear now is located on NW 6th and Flanders and the directors/teachers of nine years, Joy Cartier, Beth Burns and Pippa Arend, will be happy to display their books and their numerous awards to anyone so that they might see how the program operates to benefit the whole community.
I urge you to check the facts for yourself by contacting p:ear at pearmentor.org. It's all about the young people.
—Emily Othus, A proud supporter of p:ear