Cranky About Chase Again

Remember how ornery I got back in December when Chase launched that Community Giving contest on Facebook?

Well, last month I got all cranky again. I opened my New York Times on Thursday, July 29, 2010 and found a full page ad from Chase, congratulating all thirteen winners from New York State. Seeing as I live in New York State, I work in not-for-profit, and I’d never heard of any of them, I decided to do a little poking around. This wasn’t the original contest; this was Chase’s second round – open only to small non-profits with annual operating expenses of under $1,000,000.

From Chase's Facebook page:

2.5 million people came together to give back in a big way!
Thank you for being part of the second Chase Community Giving! Because of what we did, 200 local charities will share in $5 million of donations!
By voting, inviting friends, and sharing your enthusiasm, you've helped communities all across the country! Together, we've shown the world what two and a half million people can do when they unite to do something amazing.
With a new focus on charities that serve their local communities, Chase Community Giving came back strong for Summer 2010. With another $5 million in donations, we're helping over 200 charities. 195 charities are receiving $20,000 each and four runners-up are receiving $100,000 each. The winning charity, HP Alliance of Somerville, MA is receiving $250,000. On top of that, the charities selected by our Advisory Board in the coming weeks will split an additional $500,000.
Chase Community Giving will be back soon. Keep coming back so we can do it again!

Out of pique, I made a spreadsheet of all of the 13 NYS winners, each of which got $20,000. The chart here shows how many votes each organization got, along with the expenses reported on their last tax return (and the date of the last tax return). [I got the tax returns, a/k/a 990s, via Guidestar - a great resource for information about charities and foundations. Guidestar gets the 990s directly from the IRS.]

Note that two organizations have not been filing tax returns - and therefore, because there's no return posted to Guidestar, there's no way to check the expense size of the organization. Of the 11 remaining that have been filing, four have reported expenses of under $100,000 - and one of those shows an expense budget of $17,853 - or less than the $20,000 Chase grant. That means that only seven out of thirteen have an expense budget in excess of $100,000. A $20,000 grant to an organization with annual operating expenses of under $100,000 is a distortion, and it's not sustainable - what are they going to do when they don't get that $20,000 next year?

Remember what I said in December?

But the problem is that it’s a popularity contest that rewards those organizations with the greatest social networking savvy and not those with the greatest impact and/or efficiency of operations. Arguably, a small organization with terrific grassroots skills but mediocre delivery of a dubious service could win a million bucks - and then fritter it away on pizza and airplane tickets. There's no vetting, no due diligence.

I'm not making judgments as to the worthiness of any of the winners - they may well be doing great work. But there's no evaluation as to fiscal responsibility or organizational stability, good governance and sound management. All they've proven is that they're good at getting their "friends" to vote for them on Facebook.