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10 Accountability Standards To be eligible for the Combined Federal Campaign (and thus to be included in this information service), charities must meet at least 10 accountability standards. (These standards can be found in the Code of Federal Regulations: 5 CFR Part 950: section 950.202, 203 and 204; published November 24, 1995.) These criteria include: 1. Low fund-raising and administrative costs. To be eligible, charities must spend less than 25 percent of their income on overhead. If they spend more than 25 percent, they must explain why a higher percentage is reasonable and submit a plan for reducing these expenses to less than 25 percent. We have included the exact amount each charity spends on overhead in our information service. 2. An annual audit. All national organizations must be audited every year "by an independent certified public accountant in accordance with generally accepted auditing standards." Local organizations must also be audited annually unless their income is less than $100,000. 3. An annual report to the IRS. These reports, known as "990s," include extensive information about an organization's income and expenses. 4. Documentation of the human health and welfare services, benefits or assistance that the organization provides. 5. Recognition of 501(c)(3) status by the IRS. These "c-3s" are the only organizations that can receive tax deductible contributions. As such, they cannot spend any of their money on partisan political activity. They can spend only a relatively small amount on lobbying and other forms of advocacy. 6. An "active and responsible governing body." An organization must have a board of directors, none of whom have a conflict of interest and most of whom serve without compensation. Nearly all board members of charities are volunteers, receiving no pay. 7. Honest promotion. An organization's publicity and promotional activities must be "based upon its actual program and operations." They must also be "truthful and non-deceptive and make no exaggerated or misleading claims." 8. Non-deceptive use of donations. Organizations must use gifts "for the announced purposes of the charitable organization." 9. Public support. At least 20 percent of an organization income's must come from the public. 10. An annual report available to the public. Organizations must prepare annual reports that describe their activities and identify their board members and top staff. The report must be made available on request. Additional geographic-based requirements: To qualify as a local organization in one of the Combined Federal Campaign's more than 400 local campaigns, an organization must demonstrate that "it has a substantial local presence in the geographical area...." An "800" number and a post box is not enough! To qualify as a statewide organization, an organization must have a presence in at least 30 percent of a state's geographic area's or benefit 30 percent of the state's population. To qualify as a national organization, an organization
must provide services or benefits in at least 15 states during the
past three years.
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