San Diego BBB Sells Nonprofit Certifications
Organizations will pay $1,000 to $15,000 (based on their donations) for use of the BBB seal.
For several years, the Better Business Bureau Wise Giving Alliance (EIN 52-1070270 Form 990) has been certifying national charities based on a set of standards that it developed. As part of this program, local BBB affiliates are allowed to adopt the standards for application to local charities.
The San Diego Union Tribune reports that the local BBB chapter has started their program in March, with the interesting twist that charities have to pay, on a sliding fee scale based on the amount of donations the organization receives. All seven organizations that have applied so far have received the seal.
The standards are not that difficult to meet, notes Sara Roscoe Wilson of Nonprofit Management Solutions (EIN 33-0508897 Form 990), an organization that trains and consults with charities. The issue raised by the article is whether one set of standards is sufficient for the wide variety of nonprofits. There is mention of nonprofit ethics programs offered by the University of San Diego (EIN 95-2544535 Form 990) that engages in a wide inquiry as to what is the appropriate level of accountability and transparency for different organizations.
To me, there is the more fundamental question of the appropriateness of charging a fee based on the level of donations. The BBB review is not an audit, and it is not more difficult or complex to review a large organization. The size-based fee seems to be merely an attempt to cash in on the value of the BBB brand.
Of course, there is also the appearance of conflict of interest that the fee introduces. The BBB will make a substantial profit on reviewing large organizations. How serious will their reviews be under such a circumstance? (Note that at the national level the certification process is free, but organizations have an option to license the logo—the review and the license are separate.)
Bennett Weiner, Chief Operating Officer of the BBB Wise Giving Alliance provides these comments:
I regret to note that your message is incorrect on a number of points.
The BBB in San Diego has indicated to me that they will be contacting the San Diego Union Tribune about inaccuracies that appeared in the June 12th article you referenced in your "Where Most Needed" column.
In turn, I hope that you will correct the content or at least post this
response to your "Where Most Needed" readers.
The BBB in San Diego runs its charity review program in the same manner
as the BBB Wise Giving Alliance does for national charities.
There is no charge to charities to be subject of an evaluation in relation to the 20 Standards for Charity Accountability. And, there is no charge to the public for access to the resultant reports.
If a charity is found to meet standards, it can, if it wishes, apply to participate in BBB/San Diego's charity seal program. The Bureau in San Diego reports on both charities that meet standards and those that do not. The fees cited in your article are also incorrect. Those are the fees
for nationally soliciting charities participating in the BBB Wise Giving
Alliance seal program. The fees for local charities participating in the
BBB /San Diego charity seal program range from $380 to $1,200.
Regarding the comment in your article that claims "the standards are not
difficult to meet," [note: this was an observation made by a nonprofit consultant quoted in the Times Unions article] approximately 35% of the national charity evaluations completed by the BBB Wise Giving Alliance show that the subject organization does not meet one or more of our standards. In general, local BBBs experience a similar volume of charities that are found not to meet standards. [Note: the Times Union article indicated that all seven that have applied so far have been approved.]
Posted by: underalms | June 13, 2006 at 02:47 PM