Veterans Charity Wrongly Given Low Marks by Others
With so many veterans charities spending
most of their donations on fundraising campaigns that are often
disguised as educational programs in their financial reporting,
it is gratifying to find groups that are actually offering valuable
programs to meet the most pressing needs of veterans. One such group
is the Intrepid Fallen Heroes Fund (IFHF), which receives
an A grade from the American Institute of Philanthropy. IFHF deserves
praise for raising funds for two important centers for veterans
medical services. In January 2007 IFHF completed construction of
the Center for the Intrepid, a 60,000 square foot physical rehabilitation
center in San Antonio, Texas, to help severely injured veterans.
And last June it completed the National Intrepid Center of Excellence,
a 72,000 square foot medical-diagnostic care and research center
in Bethesda, Maryland.
You may be surprised to learn that the
two other major charity monitoring groups give IFHF low marks for
its financial performance: Charity Navigator (CN) issues IFHF zero
out of four stars for efficiency and the BBB Wise Giving Alliance
reports that IFHF does not meet its program efficiency standard.
How could this be when AIP gives IFHF an A grade for spending 87%
of its 2009 budget on program services? Both of the other groups'
ratings are a result of simply grabbing numbers from financial reports
and computing simplistic ratios rather than taking into account
how the charity is actually spending its donations.
CN, using IFHF's fiscal 2009 tax form,
takes the reported program service expenses of $583,632 and divides
it by the total reported expenses of close to $1.5 million to arrive
at a meager 39% program ratio. This is grossly unfair to IFHF because
it omits nearly $6 million in fiscal 2009 construction costs for
the new Bethesda medical facility. BBB makes the same bad calculation
by grabbing the program and total expense figures directly from
IFHF's audited financial statements without an adequate analysis
of how the charity is operating, and also fails to give credit for
the construction costs of its medical facility for veterans.
CN's and BBB's treatment of IFHF is not
helpful to donors looking to locate and support an efficient charity.
IFHF is fulfilling its purpose and honoring its donors' intentions
by building medical facilities. IFHF should not be penalized by
charity monitoring groups just because current accounting rules
do not allow IFHF to count the costs of constructing a medical facility
as a program expense until year ending April 30, 2011, the fiscal
year in which the facility is completed and handed over to the U.S.
Army to staff and operate.