In an article originally published on Sunday, November 11, 2001, in The San Francisco Chronicle's Sunday Magazine section, titled "Converting Cars into Cash - Donating your car to charity seems like a good idea. But how much of the money really ends up with the cause?" Chronicle staff writer Craig Marine took the usual tough reporter's stance vis-à-vis the costs of operating vehicle donation programs but he still did at least explain the charities and vehicle donation processors position as well. Mr. Marine kindly identified the Vehicle Donation Processing Center, Inc. as "one of the larger and more reputable middlemen" and quoted Pete Palmer at some length on his insight into the car donation field. (We especially enjoyed Mr. Marine's Palmer quote zinger, at the very end of the article, "...we're hard-working, middle class businessmen. No jets, no limos.")
In fairness to those upstanding, for-profit commercial fund-raisers, they are the ones doing all the work. The commercial fund raisers absorb all the costs associated with soliciting, collecting, repairing, reselling and/or auctioning off what are largely - according to Pete Palmer, vice president of the Vehicle Donation Processing Center Inc., one of the larger and more reputable middlemen - Junkers worth an average of $400.
Palmer, in fact, bristles (to put it mildly) when the topic of percentages comes up in the vehicle donation business.
"The whole issue is bogus and I'll tell you why. I can only speak for our business and yes, there are bad guys out there, but in truth, there are a high percentage of fixed costs associated with trying to get cars for charities. If this is combined with the fact that the average worth of a donated car is around $400, then it's much clearer why charities don't get a higher percentage of the total revenue.
"We have towing, we have DMV costs - the fixed costs run to about $200 per car," Palmer continues. "There are lots of cars we take a loss on, and we turn all of our cars over to auction, it's the only way we do it because it's the reputable way to do it, in my opinion. Some of the cars we get might be worth $5 or $10, honestly, and we're going to eat that cost. If every car we got in was worth $10,000, then I'm sure we could turn 90 percent of the money over to charity. But I've been doing this for quite a few years, and I think I may have seen two donated cars worth 10 grand."
Perhaps because the case was more recent or eventually solved and therefore received more publicity, the Klaas Foundation received $2,429,174 in total revenue through its 1999 commercial fund-raising campaign for vehicle donations with the aforementioned Vehicle Donation Processing Center, Inc. The Amber Foundation, while not approaching that total, still took in $15,045.92 during the same time period, using a different commercial fund-raiser, Charity Funding Services Inc. the percentage paid to the foundation was 39.95 percent.
Of those totals, the Klaas Foundation actually received $1,265,473.10, or 52.09 percent of its total, while the Amber Foundation pocketed a mere $6,011, or 4 percent of its original $150,000-plus total revenue.
Paula Skuratowicz, the executive director of the Polly Klaas Foundation, doesn't have a problem with 48 percent of more than $2.4 million going to a for-profit organization.
"Frankly, I think it is a win-win situation for us as a nonprofit. This is the agreement we entered into, and the fund-raiser does have to absorb a tremendous amount of expenses," Skuratowicz says. "I think people out there are looking for a way to help, and this gives the public a way to help. We're very satisfied with the relationship - after all, it's more than a million dollars that we would not have otherwise gotten, and its money that we badly need."
As an aside, Skuratowicz also points out that the consistent advertising, not just for her own charity but others of a similar ilk, keeps the issue of missing children before the public.
"It can be very easy for people to forget about this issue if there isn't some highly publicized case going on at a given time," she contends. "When you hear our ads or see the billboards with the foundation's name on them, it serves as a reminder that children are being kidnapped around the country all the time; it breeds certain vigilance and an ongoing compassion." At the risk of appearing crass, it might seem that it's one thing to be satisfied with half of $2.4 million and quite another to run a charity receiving about six grand out of $150,000. However, even Kim Swartz, whose Amber Foundation took in the low end of the second total, still can't quite bring herself to rip her fund-raiser.
Back in the world of vehicular giving, Palmer explains the discrepancies one sees between various campaigns his company runs quite simply: Vehicle Donations Inc. runs different campaigns for different companies, and there is no way to control what might be towed in for whom.
"Different cars come in to different companies. If we had omniscient telephone operators, we could only accept the best cars. But we don't. And, naturally, the highest cost comes from the media - advertising. Without it, we can't reach enough people, and it can get quite expensive placing advertisements in various places, but we do the best we can by all our clients, that I can promise," he says.
Palmer's arrangement with the charities is simple.
"We guarantee that the charity will not lose money. We split the net proceeds down the middle. Are there crooks out there? You bet - people with side deals with used car lots, all kinds of things. But then again, there's crooks everywhere,” Palmer continues, before concluding with his own description of himself and the people at his company. "I like to say that we're hard-working, middle class businessmen. No jets, no limos."
http://www.car-donate-program.com
http://www.world-donation.com
http://www.donation-car-us.com
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