HRC Responds

Here's the relevant section from an email sent to me by the Human Rights Campaign, the largest gay rights group. You decide if they satisfactorily answer the questions raised here, here, and here:

We are committed to the transparency of the organization. Ninety-three percent of our total income comes from individuals, reflecting the importance of our work as seen by the broader community, and it is important they understand how their dollars are being put to work.

Charity Navigator is a rating entity that only analyzes the IRS Form 990 for 501(c)(3)s. In our case data for the Human Rights Campaign Foundation (HRCF), which focuses on non-political educational programming and outreach, was the only data considered. Unlike other national GLBT organizations such as GLAAD, GLSEN, etc., much of the activity undertaken by HRC is through our 501(c)(4), which receives contributions that are not tax-deductible. As you know, HRC’s 501(c)(4) is the political arm of the organization that is responsible for, among other things, lobbying Congress and state legislatures, mobilizing grassroots supporters to engage in pro-GLBT political activities and investing strategically to elect fair-minded officials.

HRCF’s current rating on Charity Navigator’s site does not reflect the latest information available from the IRS Form 990. HRC’s rating by Charity Navigator’s methodology is also affected by our capital campaign to build a national headquarters that was started in 2000 (which I will address in a moment). We estimate that HRCF’s rating on Charity Navigator would rise from one star to three stars for the fiscal year ending March 31, 2006, if data for the capital campaign were removed from the calculation as we understand it.

I believe it is important to point out a few facts about our capital campaign. When the campaign was launched, analysis showed that the organization would save more than $15 million over 15 years by owning a building rather than paying rent to a landlord. That estimate was using conservative assumptions for rental and operating cost increases, and did not factor in any potential appreciation in the value of the building. That means that instead of membership dues going to pay ever-increasing rent, the resources entrusted to us would continue to go directly toward the fight for equality.  And it is important to note that no membership dues were used to finance the capital campaign.

In a subsequent posting, you refer to the Better Business Bureau’s “Wise Giving Alliance” - another rating system that only analyzes 501(c)(3) organizations. Like Charity Navigator, the Better Business Bureau’s guidelines do take into account the capital campaign which would unfairly skew our numbers. We fully expect to submit documentation and we anticipate we will pass all 20 of their standards.

A PDF file of HRC's 2006 IRS 990s can be downloaded here. I've asked HRC if they will answer a few emailed questions about their operation, what it spends, how it spends it, and what achievements they have won for the money. If you have any questions, especially if you've read the 990s, feel free to email me. I don't know yet whether they'll respond. They asked for a private meeting with me. I'd rather bring a few thousand readers along.