I did. It was about nine years ago. I was sitting in the waiting area of Supercuts, waiting for my buzz and trim, when I saw a flier for the AIDS marathon training program. I always thought it would be a great personal accomplishment to say that I ran a marathon. Besides, I would be raising money for a great cause, AIDS research, education and support programs. Not to mention that I was a few years out of college, and my Freshman Fifteen had turned into the Through with College Thirty (actually forty, but I was going for the alliteration).
But just last week we were talking about American's perception of the proportion of donations that go not to the end charitable cause, but to overhead and fund-raising expenses. So, looking back on my experience, this is my attempt to recreate the expenses that were involved and how much actually may have gone to the charitable causes.
It was an incredible experience. One I will always remember with pride. The rules were simple. We each had to raise a minimum of $2,600. Those contributions from family, friends and colleagues were tax deductible donations. For our efforts, the AIDS Marathon Training Program organized a training schedule, weekly group runs, marathon fees, round trip tickets from Los Angeles to Washington D.C., and two nights at a decent hotel (a shared room).
The $2,600 was not easy to raise, but as the contributions came in from various affiliations in my life, I was encouraged to keep running. I pushed myself physically in a way that I have never before. In the end, I raised over $3,200 for AIDS Project Los Angeles, completed the U.S. Marine Corps Marathon, and had a really great time.
But what about those tax deductible donations, and the money raised for AIDS Project Los Angeles? Well, we know about certain costs that have to be deducted before the money makes it to the charity. There’s the marathon registration, which was around $80. The plane ticket may have been the largest expense. We’ll put it at around $300. That might be conservative, but this was 1998, not 2008. Likewise for the hotel rooms. Maybe $140 per night, two nights, shared with a roommate. So, multiplied by two, divided by two…
The marginal cost per runner is approximately $520. Of course, the biggest expense is the full time staff person who runs the program. I’m not sure how much he gets paid, but let’s say it’s $30,000. The other support staff members are volunteers. I believe there were approximately 300 runners in our program, so the incremental cost of the full time staff person is another $100 per runner.
If I’m accurate on the expenses, that means that 80.6% of the money that I raised made it past the expenses and to the charitable organization. Someone who raised the minimum, $2,600, saw closeer to 76% of their fund raising efforts go to AIDS Project Los Angeles.
Are these numbers appalling? Not nearly. But when we consider the general overhead expenses of the organization, it appears that the cost of fund-raising plus general overhead means that a substantial portion of the contributions to go to purposes other than the cause of the organization.
However, there are other benefits to the organization that result from this type of fundraiser. Donors who would never have given to a particular charity will do so because of the relationship with the runner/fund-raiser. In that sense it builds new relationships, and increases awareness of their programs and causes. I continue to support friends who choose to participate in these types of fund-raisers, however, it should remain a small part of anyone’s overall charitable giving.
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