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By Kenneth Danilson
Recent media reports and congressional hearings have called the reputations of several veterans charities into question. Conspicuously absent from the reports have been programs administered by The American Legion.
“Why don’t you have hearings on us?” American Legion National Adjutant Robert W. Spanogle once asked former Sen. Alan Simpson of Wyoming.
“Because you guys do it right,” Simpson said. Although a couple of decades have passed since the exchange, it is clear that The American Legion still “does it right.”
“I am quite proud of our record of delivering donations,” said National Commander Marty Conatser. “When people donate to one of our programs, they can be assured that their donation goes to the cause for which it was intended. Promotional expenses are usually quite low and staff salaries are paid from our general budget, not the charitable donations.”
One such program is the National Emergency Fund. The NEF was created in aftermath of Hurricane Camille in 1969 to provide funds to Legionnaires victimized by natural disasters. During the unprecedented hurricane season of 2005, which included Hurricanes Katrina and Rita, more than $2.1 million in NEF grants were awarded. Relying mostly on publicity from The American Legion Magazine, Dispatch, the national web site, department publications and post newsletters, the NEF only paid $7,083 in expenses that year, an amazing 3/10ths of one percent of the $2.36 million it received in donations.
The NEF continues its outstanding fiscal prudence, having spent only $10,520 in 2007 expenses (through Nov. 30) and awarding $159,950 in grants. Donors gave $401,835 in 2007, with most of the money going into interest-earning accounts to be used for future disasters.
The American Legion Endowment Fund was established in 1925 with $5 million after a year-long fundraising drive. The Endowment Fund is still used today to provide grants to military families in need and to support veterans rehabilitation programs.
In 2007, $301,240 in grants were awarded by November 30, even though the fund only received $64,386 in donations. This is possible in part because of the investment revenue which exceeded $595,000 during the same period.
Money set aside in American Legion accounts are in a metaphorical “lock box.” In other words, money can not be transferred from one program to another. The programs themselves are authorized by the National Executive Committee, a body with representatives from all 55 American Legion departments which serves as the organization’s board of directors.
One of the more recent programs, The American Legion’s Legacy Scholarship Fund, was established shortly after the 9/11 attacks. The fund helps pay college costs for children of fallen servicemembers who are killed on active-duty since Sept. 11, 2001. With nearly $2.1 million in the account, the only 2007 expenses through November (besides actual scholarships) were the $9,045 investment fees. The American Legion would like the fund to continue to grow so it can operate on investment earnings, thus always having money available to cover the increasing number of students needing scholarships.
Fitting in with The American Legion’s long tradition of helping America’s youth is the Child Welfare Foundation. Created in 1954, the CWF provides grants for projects and programs that “contribute to the physical, mental, emotional and spiritual welfare of children and youth.” In the first 11 months of 2007, the CWF awarded $536,500 in grants. Donations to the CWF were $595,682 and the $6.67 million fund balance earned $587,685 in investment revenue. Administrative expenses for the CWF were only 1.97 percent of the fund’s balance.
As a congressionally chartered nonprofit organization, The American Legion files a report on its activities annually with the U.S. Congress. Moreover, each of The American Legion’s major funds – the Endowment, the NEF, CWF and American Legion Legacy Scholarship Fund – are separately incorporated or chartered, each with its own articles, bylaws, purposes and trustees. Each of these nonprofit corporations files an annual Form 990 with the IRS. The financial reports for the funds are included as part of The American Legion’s annual audit, which is printed in the National Convention program and distributed to all delegates, alternate delegates and registered guests attending the convention.
Legion audits and 990 tax returns are available to any member of the public who requests to see them. This has been the case since The American Legion’s founding in 1919.
“The American Legion has always believed in transparency regarding our finances,” Conatser said. “We are ethical and efficient. Regardless of what one may read about other charitable organizations, our members and donors should be confident and proud of the way The American Legion administers its charities.”
Kenneth Danilson is chairman of the American Legion National Finance Commission.
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Posted by Lemessa Ayele Wakjira | 01/23/08 7:00 AM |