A gossip columnist fills in some details about a messy family feud in Florida involving the heirs of the founder of the National Enquirer.
It's been awhile since we've talked about an estate dispute involving a charity (The Culverhouse Equation, April 11, 2006). Liz Smith reported in her New York Post column about the lawsuit by Paul Pope, son of Generoso Pope, who started the National Enquirer, against his mother, Lois Pope.
The charity angle: Mrs. Pope is the co-founder and current chair of the Disabled Veterans LIFE Memorial Foundation (EIN 52-2098855 Form 990), a charity that is raising money to build a memorial to disabled veterans a couple of blocks from the US Capitol building in Washington DC. According to the organizations web site, they need to raise the entire $65 million in construction costs before ground will be broken for the project.
Son Paul complained to the Palm Beach Post that the charity is spending money on direct mail marketing as fast as it is raising it. The organization has sent out 8.5 million pieces and has received about 750,000 donations, averaging $16.58. About half the donations are from repeat donors. The organization relies heavily on premiums like coffee mugs, umbrellas, and stadium blankets. There have also been some successful galas, but not enough to offset the cost of the direct mail program.
The 2005 Form 990 shows that the organization raised $5.6 million but spent $4 million on mailing materials and $1.3 million on postage, plus an additional half million on professional fundraising fees. With additional expenses for special events and an office staff of five, the organization lost over $2 million and at the end of 2005 had a negative net worth.
The Chronicle of Philanthropy reported in their Gifts & Grants section late in 2006 (subscription only, sorry) that Mrs. Pope had injected an additional $5 million into the project, so it remains afloat. Since her worth is about $190 million (according to Liz Smith), she could even pay for the whole project, if she wanted to.
It is quite difficult in this era to raise large amounts of money for a new cause relying only on small donations. Mrs. Pope should consider a major gift program, as soon as possible, and possibly an affiliation with a national consumer brand. A local chapter structure for fundraising might have made sense, but it's too late to start one now.