PENNIESFORCHARITYWHEREYOURMONEYGOES

TELEMARKETINGBY

PROFESSIONALFUNDRAISERS

CHARITIESBUREAU

OFFICEOFTHEATTORNEYGENERAL

ERICT.SCHNEIDERMANATTORNEYGENERALFEBRUARY2014

PenniesForCharity::Page1

PENNIESFORCHARITY2013REPORTONTELEMARKETINGCAMPAIGNSINNEWYORK

TelemarketersregisteredinNewYorkreportedraisingmorethan$249millionincontributionsin2012,themosteverreportedinthehistoryofPenniesforCharity.However,manydonorsmayfindittroublingtolearnthatonly37.9%ofdonorscontributionsinresponsetotelemarketersolicitationsactuallywenttocharities.

NewYorkersandpeoplethroughoutthecountrygavegenerouslytoanumberofcauses,includingHurricaneSandyreliefeffortsandsupportforvictimsoftheSandyHookshootings.Thisgenerosityisallthemoreextraordinarygiventhatmanydonorsundoubtedlyfacedtheirownsignificantchallengesinthesedifficulteconomictimes. AstheregulatoroverseeingcharitablefundraisinginNewYorkState,AttorneyGeneralEricT.Schneidermanhasmadeitaprioritytoprotectdonorsandthecharitiestheysupport,strengthenpublicconfidenceintheseorganizationsandensurethatcontributionsassistthoseinneedofsupport.OnewaythatAttorneyGeneralSchneidermanachievesthesegoalsisbypromotingtransparencyandshiningaspotlightonhowcharitablecontributionsarespent.Forexample,inJuly2013,ourofficepublishedareport,CharitableResponsetoHurricaneSandy,whichprovidesthepublicwithdetailedinformationonhowHurricaneSandyrelieffundswerespent.OurofficealsowasthedrivingforcebehindtheNonprofitRevitalizationActof2013,whichincludesnumerousprovisionstoimprovenonprofitgovernanceandaccountabilityinNewYork.Moreinformationconcerningtheseandotheractivitiesbyourofficearepostedatwww.CharitiesNYS.com.

ThroughPenniesforCharity,ourannualreportontelemarketingcampaignsinNewYork,membersofthepubliccanfindoutwhatportionoftheircontributionswenttofeesandtelemarketers'expensesandhowmuchwaslefttosupportcharitableprograms.Thereportshowsthatfartoolittleofthemoneyraisedbytelemarketersgoestocharitablepurposes.Intotal,ofthenearly$249.3millionincontributions,62.1%wasusedfortelemarketersfeesandthecostoftelemarketingcampaigns.Charitiesretainedonly37.9%ofdonorscontributions.Thisfindingfor2012isconsistentwithadisturbingpatternoftelemarketersretainingthemajorityofthefundstheyraise.Inthelastelevenyears,charitieshaveneverretainedmorethan41.7%ofthefundsraisedbytelemarketersinasingleyear.Further,innearly8outevery10fundraisingcampaignsconductedin2012,charitieslostmoneyorretainedlessthan50%ofthecontributionsraised.WeurgeNewYorkerstoconsultthisreportandconsideritsfindingscarefullybeforemakingadonationinresponsetoaphonesolicitation.Thisreportalsoincludesusefultipsforcharitieswhennegotiatingafundraisingcontract,andweurgeNewYorkcharitiestousethisreportasaresourceaswell.Charitiesthatfundraisefromthepublicshouldmaximizetheshareofdonors'hardearneddollarsusedforcharitableprogramsinsteadoffundraisingoverhead.

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FINDINGS

Thisreportincludesdatafrom589campaignsconductedin2012bytelemarketersregisteredtosolicitcharitablecontributionsinNewYork.Allofthefiguresreportedweretakendirectlyfromreportsfiledbythetelemarketersandsignedbyrepresentativesofboththetelemarketersandthecharities.Thecampaignsraisedover$249million.Keyfindingsinclude:

62.1%,or$154.8million,ofthe

fundsraisedbytelemarketersin2012werepaidtofundraisersforfeesand/orusedtocoverthecostsofconductingthecampaigns.Charitiesretainedonly37.9%,or$94.5million,ofthetotalfundsraisedinthecampaigns.

In77.9%,or459ofthe589campaigns,thecharitiesretainedlessthan50%ofthefundsraisedorexpensesexceededcontributions,meaningthecharitiesactuallylostmoney.

In50.3%,or296ofthe589campaigns,thecharitiesretainedlessthan30%

ofthefundsraisedorexpensesexceededcontributions.

In15.4%,or91ofthe589campaigns,expensesexceededcontributions. Ofthe589campaigns,333wereconductedonbehalfoforganizations

locatedoutsideofNewYork.

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PERCENTAGEOFFUNDSRETAINEDBYCHARITY

* 91 telemarketing campaigns reported a loss to the charity. This can occurwhen the fundraisingcontractdoesnotguarantee thecharityaspecificdollaramountorspecificpercentageof thegrossreceipts,includingwhenfundraisingisincidentaltothetelemarketingcampaign,orwhenthecontractdoesnotholdthecharityharmlessforexpenses/feesthatexceedthegrossamountcontributed.

37

18

30

72

82 81

70

87

48

91

0

10

20

30

40

50

60

70

80

90

100

90to100+%

80to89%

70to79%

60to69%

50to59%

40to49%

30to39%

20to29%

10to19%

0to9% Loss*

Num

bero

fCam

paigns

PercentRetainedbyCharity

2012TelemarketingCampaignsbyPercentRetainedbyCharity

PercenttoCharity

NumberofCampaigns

PercentofCampaigns

GrossAmountRaised

PercentofTotalFunds

RaisedNetAmountReceived

PercentofTotalNetAmount

90to100% 3 0.5% $4,368,770.29 1.8% $4,206,164.21 4.5%80to89% 7 1.2% $13,172,002.78 5.3% $10,926,487.22 11.6%70to79% 18 3.1% $17,074,601.83 6.8% $12,497,804.05 13.2%60to69% 30 5.1% $14,587,409.76 5.9% $9,382,711.14 9.9%50to59% 72 12.2% $16,302,998.06 6.5% $8,864,478.63 9.4%40to49% 82 13.9% $65,827,487.32 26.4% $28,987,455.77 30.7%30to39% 81 13.8% $21,154,275.29 8.5% $7,440,475.97 7.9%20to29% 70 11.9% $27,331,775.87 11.0% $6,990,353.10 7.4%10to19% 87 14.8% $42,490,235.41 17.0% $6,107,085.83 6.5%0to9% 48 8.1% $20,759,390.91 8.3% $1,280,418.09 1.4%Loss 91 15.4% $6,196,419.43 2.5% $(2,201,666.22) 2.3%TOTAL 589 100.0% $249,265,366.95 100.0% $94,481,767.79 100.0%

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GEOGRAPHICALAREA

BasedupontheaddresscontainedindocumentsfiledwiththeCharitiesBureau,eachcharitableorganizationlistedinthisreporthasbeenassignedtoaparticulargeographicarea.Thefollowingisalistofthesegeographicareas,thecountiesincludedineacharea,totalgrossdollarsraisedonbehalfofcharitieslocatedineachareaandthenetamountreceivedbythesecharitableorganizations:

GeographicalArea Counties GrossReceipts NettoCharityRetainedbyCharity

1NewYorkCity Bronx,King,NewYork,Queens,Richmond $42,323,331.70 $22,796,420.61 53.9%

2LongIsland Nassau,Suffolk $8,475,985.42 $2,125,715.60 25.1%

3LowerHudsonValley

Delaware,Dutchess,Orange,Putnam,Rockland,Sullivan,Ulster,Westchester $6,447,149.63 $3,133,906.99 48.6%

4CapitalDistrictandEasternAdirondacks

Albany,Clinton,Columbia,Essex,Franklin,Fulton,Greene,Hamilton,Montgomery,Rensselaer,Saratoga,Schenectady,Schoharie,Warren,Washington

$4,868,188.61 $1,732,234.67 35.6%

5CentralNYandWesternAdirondacks

Broome,Cayuga,Chenango,Cortland,Herkimer,Jefferson,Lewis,Madison,Oneida,Onondaga,Oswego,Otsego,St.Lawrence,Tioga,Tompkins

$520,885.00 $198,556.20 38.1%

6RochesterandSurroundingArea

Chemung,Livingston,Monroe,Ontario,Schuyler,Seneca,Steuben,Wayne,Yates $956,649.67 $501,629.74 52.4%

7WesternNY Allegany,Cattaraugus,Chautauqua,Erie,Genesee,Niagara,Orleans,Wyoming $1,277,117.30 $517,252.69 40.5%

8AllOthers LocationsoutsideNewYorkState $169,583,918.99 $58,485,003.76 34.5%

PenniesForCharity::Page5

HOWTHISREPORTWASPREPAREDThedatainthisreportwereobtainedsolelyfromfinancialreportsfiledwiththe

AttorneyGeneralsCharitiesBureaubyprofessionalfundraisersregisteredinNewYorktoconducttelemarketingcampaignsonbehalfofcharitableorganizationsduring2012.1Thosereportsareeitherclosingfinancialstatementssubmittedaftercompletionofatelemarketingcampaign,orinterimfinancialstatementssubmittedannuallyforcampaignsconductedforaperiodlongerthanoneyear.2Eachfiledreportmustbesignedbyboththeprofessionalfundraiserandthecharitableorganizationitrepresents.AllofthecharitieslistedinthereportconductedtelemarketingfundraisingcampaignsinNewYorkState.3However,theamountsreportedreflectthetotalamountofmoneyraisedandnotjustwhatwasraisedinNewYork.

Thereportincludesseventables: Table1liststhecharitableorganizationsinalphabeticalorder,theprofessional

fundraisersthatconductedeachorganizationstelemarketingcampaign,thegeographicallocationofeachcharity,whetherthefilingsubmittedwasaninterimorclosingstatement,thetotalamountraisedineachcampaign,theamounteachcharityretained,theamountofanyuncollectedpledgesandthepercentageofthetotalraisedthateachcharityretained.Ifacharityengagedmorethanonetelemarketer,eachcampaignislistedseparately.

Table2issimilartoTable1andorganizedalphabeticallybyprofessional

fundraisernamefirst.

Table3issimilartoTable1andorganizedbypercentageretainedbycharityindescendingorder.

Table4issimilartoTable1andorganizedbycharitynameandgeographical

location. Table5presentsthetotalamountraisedandretainedbyeachcharityinallofits

2012campaignsindescendingorderbytotalpercentageretainedbythecharity. Table6presentsthetotalamountthateachprofessionalfundraiserraisedinits

campaignsin2012andthetotalamountthatwasretainedbyitsclientcharitiesin

1RegistrationofprofessionalfundraisersisrequiredbyArticle7AofNewYork=sExecutiveLaw.RegistrationshouldnotbeconstruedasapprovalorendorsementbytheAttorneyGeneralofanyprofessionalfundraiserortheaccuracyorcompletenessoftheinformationcontainedinanyfiledfinancialreport.

2Readersshouldbeawarethatthefinalfiguresandratiosmaychangewhenacampaignhasbeencompletedandallincomeandexpensesarereported.

3Informationforanadditional22telemarketingcampaignsconductedduring2012hadnotbeensubmittedpriortothepreparationofthisreport.

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descendingorderbythepercentageretainedbythecharities. Table7containscontactinformationfortheprofessionalfundraisers,asprovided

bythemtotheCharitiesBureau.Uncollectedpledgestoacharityarenotreportedaspartofthetotalamountraised,

butarereportedinaseparatecolumnineachtable.4Nonmonetaryc