SBJ/July 17 - 23, 2006/From The Field Of

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  • Preparation can ensure event lives up to its all-star billing

    This is the season when many athletes who have charitable foundations hold fundraisers: golf, 8-ball and poker tournaments, bowl-a-thons, dinners, charity basketball, softball and hockey games, celebrity auctions — an alphabet soup of imaginative and not so imaginative events.

    The Andre Agassi Charitable Foundation’s Grand
    Slam for Children fundraiser attracts celebrities such as
    Robin Williams (right) for a concert and auction
    and raised $10 million in 2005.
    Planning a successful charitable event isn’t the same as throwing a great party. What might pass as lighthearted extravagance for your privately hosted gala could be interpreted as financial mismanagement if it involves charitable dollars.

    At the end of each fiscal year, a charity is required to report its fundraising expenses to the IRS on tax form 990. Completed forms are available to the public for review on www.guidestar.org. Many a story of a charity gone wrong has been prompted by reporters who reviewed the charity’s 990 and saw something amiss.

    The following tips should help guide you through the charitable special-event process and help to ensure continued public trust and support — the most important assets any charity can have.

    When your event is public, your mistakes and your successes are on display for all to see. It therefore makes sense to “measure twice and cut once.”

    • Identify your goals and create a budget.

    Do you want to raise money or awareness? Often, the answer is both. Create a priority list of your goals and then plan around them. Above all else, create a budget and stick to it. Turn to your budget as the final vote in all event-related decisions.

    • Add the cost of your time into the event budget.

    If an event is engaging you full time for three months, include that portion of your annual salary as an event expense. It can have a dramatic effect on the bottom line. You might also find that you could raise more money by using the same three months to ask directly for gifts instead of producing an event.

    • Ask for in-kind donations from vendors and others.

    The worst they will do is say no. They’ll never say yes if you don’t ask.

    • Donations of services are not tax-deductible.

    Unfortunately, even though someone is providing a free service to you when he could be paid for doing the same service for someone else, the service cannot be claimed as a tax deduction. One’s time is considered volunteer work.

    One can, however, deduct certain out-of-pocket expenses such as gasoline purchased to get to the event or goods purchased to complete the service. Advise volunteers to consult with their tax attorney.

    If you use an event planner, make sure you share the same definition of success.

    Lots of fun and media coverage is a good thing. But if your primary goal is to raise this year’s annual budget and the event planner’s primary goal is to showcase her firm’s talents, you could be buying yourself a headache — and unnecessary arguments about expenses.

    • Consider “piggybacking” on another event to reduce travel costs for special guests and celebrities.

    Airfare and hotel costs are a big drain on any budget. Consider scheduling your event close to another event so that you can avoid these extra expenses.

    The Super Bowl, the NBA All-Star Weekend and the Grammy Awards are always good for celebrity draw power. But schedule far in advance so that you don’t conflict with the long-standing parties.

    Keep in mind that you are never obligated to offer to pay for celebrities’ travel costs. It is a courtesy many charities extend to ensure a good celebrity turnout.

    If you do end up paying for travel, ask the airlines to provide first-class upgrades free of charge. For security reasons, most will agree.

    • Sign contracts with vendors no later than 60 days before the event.

    What is the venue’s cancellation policy? What rights do sponsors have to the use of your charity’s name?

    Spell it all out before a problem occurs. This helps clarify responsibilities and eliminate unpleasant surprises. You’ll sleep better.

    • Verify that your insurance coverage is adequate.

    Can you say liability? No one wants to think about something bad happening at an event.

    But bad can become worse for everyone concerned if you don’t plan for it. You can be certain that any aggrieved party will come looking for the deepest pockets.

    When all is said and done, make sure to examine your opportunity cost before embarking on the time-consuming journey of staging a major charitable fundraiser.

    If you spend six to nine months planning a charity golf outing and end up netting $50,000 for your charity, how much more might you have raised if you and your staff had deployed the same amount of volunteer time doing other things to raise money or further advance the mission of your organization?

    It is no coincidence that on the TV show “The Apprentice,” Donald Trump designates managing a celebrity charity event as the final and decisive task. Even he knows how hard that truly is.

    What Can Go Right?

    • Raises athlete’s and charity’s profile in the community.
    • Raises money for charitable cause.
    • Good way to get corporate sponsors more involved, which can increase their giving.
    • Engages the public and can attract new donors and volunteers.
    • Helps build athlete’s marketability.
    • Builds community spirit.

    What Can Go Wrong?

    • Bad press if the event is a flop or loses money.
    • Could lose athlete’s money if poorly implemented.
    • Athlete loses credibility with corporations and the public; sponsors drop out.
    • Time consuming and limits your ability to focus on other areas of fundraising and programming.
    • Athlete’s image is damaged.
    • Athlete and celebrity participants cancel at the last minute or run up a big tab (travel, hotel, etc.).

    Marc Pollick and Stephanie Sandler are president and CEO, respectively, of The Giving Back Fund.

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