ARod gets slammed in this article (and apparently rightly) - but this is a pervasive problem. I started doing some analysis a few years back on the subject. What I found was that these foundations can be used as marketing tools for the players and payroll bounties for family members. The worst of the worst are foundations that run fundraising events that are little more than golf boondoggles or fancy parties for the stars and their buddies.

Without doing the review of Jeter's foundation, it sure seems odd to raise $2.3 million and hand out only $1.3million. Where is that other $1 million?

I have heard that many such foundations (not just jocks' but various types) have similar issues and have read a couple of articles about it.

That said, it seems like it might be kind of a typical cheap shot at Rodriguez (shocking from the Post) with the comparison to Jeter since it is hard to know how much personal knowledge Rodriguez has.

Also, this is later in the article:

A-Rod does make sizeable personal charitable contributions outside his nonprofits.

The AROD charities are funded primarily from his own wallet, also.

***

Without doing the review of Jeter's foundation, it sure seems odd to raise $2.3 million and hand out only $1.3million. Where is that other $1 million?

Many charities have very high overhead. If you host a fund raising dinner, for example, you have to pay for the food and drinks and to rent a location, pay for entertainment or speakers, etc. You have to hire marketers to call donors or do mailings, etc. I have no idea how much of that applies to this situation, but a lot of money that goes to charities in general never makes to the intended recipients because of that.

The AROD charities are funded primarily from his own wallet, also.

That sentence seemingly conflicts with this one:

The bulk of that money was raised in one year alone: 2006, when the AROD Family Foundation pulled in $403,862. Most of it, $368,862, came from a fund-raiser, while Rodriguez kicked in the balance.

So he kicked in $35K out of $403K.

RJR mentions paychecks for family members. I recall Bond' foundation having his mother as exec director. Perhaps A-Rod is folding his because his exec director is divorcing him.

but a lot of money that goes to charities in general never makes to the intended recipients because of that.

Indeed. I have read that the average is something like .40 on the dollar. If that is ballpark-right, then one could say Jeter's foundation is doing OK.

This story, on top of the divorce one, seems ripe for a visit from the Rod.

RJR mentions paychecks for family members. I recall Bond' foundation having his mother as exec director. Perhaps that's why the A=Rod is folding his, because his ED is divorcing him.

I think if he had an ED, he wouldn't be getting divorced.

I think if he had an ED, he wouldn't be getting divorced.

But it wouldn't make him the perfect husband, either.

So many charities seem like shams. Those kind of ratios are so bad. If you care about the cause just send in the money. Buying a $200 golf outing and having only $40 go to the charity is really $40 of charity not $200. The $160 is just business. How about making it so that the tax writeoff on such a donation is based on the ratio of what the charity ends of doing with the money. If 20% makes it to the kids, sick, doctors, displaced, missionaries, etc. Then You get credit for $200 of your $1000 donation.

This is a very pervasive problem in all celeb charities.

You have to be careful who you give your money to. The bigger and more well known the charity, the less your donation is going to go to the people/cause you think it is. At a certain point, large charitable organizations judge results more by their donations than by their mission. Which isn't to say there aren't good places to put your money, you just have to be careful.

Buying a $200 golf outing and having only $40 go to the charity is really $40 of charity not $200.

And I think the deduction allowable reflects this ... you have to subtract the value of anything you receive in exchange for your donation before you write it off. If you got a round of golf worth $120, you can only write off $80.

That's not quite what you're looking for Marty, but if only $40 went to the end charity, well, I'd argue that the other $40 going to the expenses of the non-profit organization is deduction worthy. Whether your money goes to sick kids or to cover expenses for an organization that is dedicated to helping sick kids, I think that's a small difference in terms of your motive of helping others (barring abuse by the org).

(Though obviously, you'd want the organization to run as efficiently as possible.)

Per Charity Navigator (http://www.charitynavigator.org/index.cfm/bay/content.view/cpid/48.htm), a ratings service for charitable donors, 70% of the charities they evaluate devote at least 75% of the money they receive to program services (ie, their actual mission). Yes, there are poorly run charities, and even some that are pretty much scams (in the aftermath of 9/11 I got burned by an outfit claiming to benefit families/widows of policemen; when I looked them up in the NY Attorney General's database, found 80% of their revenue went to "fundraising." Costs a lot to call up suckers like me.), but most large charities are run by decent, conscientious people who sincerely try to make every dollar go as far as possible.

The funny part of it is that F-Mart is an absolutely terrible fit for the Pirates in terms of need, in that they've already got a 26-year-old All-Star (McLouth) and a ML-ready top prospect in AAA (McCutchen) at the position. That's a pretty rough peer group, and you have to think that if the Pirates get a comparable offer for Nady from someone offering anything other than a CF, they'll probably go with Option B.


I don't think Nando is expected to stick in CF. His future is in a corner.

The V Foundation, IIRC, has raised enough funds that their operation runs entirely on interest earned and 100% of donations go to the cause.

The celebrity charity in general does seem to be more of a tax write off than anything. If you consider the basic overhead of staff, rent, equipment, there is a lot of donated money that goes to nothing charitable. I think it's best to go with one of the largest charities devoted to the specific cause to get the best return.

The V Foundation, IIRC, has raised enough funds that their operation runs entirely on interest earned and 100% of donations go to the cause.

But keep in mind that, in order to get to the point where their operation runs on interest earned, they had to take in a lot of money and not give it out, for a long time. I wonder how the NY Post would've described them a while back.

If you consider the basic overhead of staff, rent, equipment, there is a lot of donated money that goes to nothing charitable.

Michael Jordan shut down his charitable foundation for just that reason.