Professional fundraisers registered in New York State retained nearly 35 percent of the funds they raised for charity in 2015, a report from the New York State Attorney General's Charities Bureau finds.
Based on data from 1,143 local and national fundraising campaigns conducted all or in part by professional fundraisers registered in the state, the 2016 edition of the report Pennies for Charity: Where Your Money Goes; Fundraising by Professional Fundraisers (8 pages, PDF) found that charities retained $718.3 million, or 65.5 percent, of the nearly $1.1 billion raised on their behalf, while fundraisers kept $379.4 million, or 34.5 percent. While the percentage retained by fundraisers in 2015 is down from the 48 percent they kept in 2013, earlier Pennies for Charity data focused solely on telemarketing campaigns, whereas the latest report includes solicitation methods such as direct mail, email, and Internet campaigns.
According to the report, charities received more than 70 percent of the funds raised in only 20.9 percent of the campaigns analyzed, while in just over half the campaigns (54.4 percent) they retained less than 50 percent of the funds and in 36.3 percent of the campaigns they retained less than 30 percent. The report also found that in 16.8 percent of the campaigns analyzed, fundraising expenses exceeded revenue, contributing to overall losses in 2015 of $16.7 million.
The report notes that some fundraising professionals have altered their business models to limit the disclosure of campaign results and recommends that charitable organizations thinking of hiring a professional fundraiser should establish a formal process to solicit bids for a fundraising contract; insist on a written contract with the fundraiser that describes the rights and responsibilities of both parties; review the fundraiser's track record on the Charity Bureau's Pennies for Charity database, which is searchable by charity or fundraiser and includes gross receipts raised, net amount, and percentage retained by the charity; and monitor the fundraising campaign to make sure the fundraiser is properly describing the organization and its programs.