United Way mythbusters, you asked, we busted
Part one: This column will be the first in a two-part series dedicated to busting the myths sometimes associated with United Way. I’ll bust five common myths this month and another five in January.
Myth #1: United Way of Southwest Minnesota supports PETA.
FACT: The United Way of Southwest Minnesota invests in five key priority areas: heath, education, financial stability, hunger and safety and well-being. All funded programs must impact local people living within the UWSWMN service area. We are an independently incorporated 501 (c)(3) organization that is governed by our own local board of directors with all resources under local control and decision making. We have no prior/current relationship with PETA and provide no financial support of their work.
Myth #2: United Way of Southwest Minnesota funds Planned Parenthood.
FACT: The United Way of Southwest Minnesota invests in five key priority areas: health, education, financial stability, hunger and safety & well-being. All funded programs must impact local people living within the UWSWMN service area. We are an independently incorporated 501 (c)(3) organization that is governed by our own local board of directors with all resources under local control and decision making. We have no prior/current relationship with Planned Parenthood and provide no financial support of their work.
Myth #3: The United Way of Southwest Minnesota financially supports/endorses political candidates.
FACT: The United Way of Southwest Minnesota does not engage in political campaign activity. IRS regulations mandate that charitable nonprofits will lose their tax exempt status if doing so. This is defined as political campaign activity that “supports or opposes a candidate for public office” and is separate from lobbying for legislative activities, which charitable nonprofits ARE permitted to engage in with limitations. United Way of Southwest Minnesota does engage in advocacy work with local, state and national political representatives regardless of political party; talking about the issues facing southwest Minnesota constituents.
Myth #4: All of the money raised here gets sent to United Way Worldwide and doesn’t stay local.
FACT: United Way Worldwide (UWW) is the support organization for the nearly 1,800 local United Ways around the globe. UWW’s work is supported by the 1 percent membership fee paid by local United Ways such as the United Way of Southwest Minnesota. The membership fee we pay to UWW is recouped by our local communities many times over in training, services and access to national corporate and employee giving campaigns.
Myth #5: United Way of Southwest Minnesota has extremely high overhead and hardly any of the funds raised actually go to the people and programs that actually need it.
FACT: The percent of charity expenses that go to administrative and fundraising costs — commonly referred to as “overhead” — is a poor measure of a charity’s performance. We recommend that you pay attention to a broader set of factors about nonprofit performance: transparency, governance, leadership and results, as well as, finances.
United Way of Southwest Minnesota takes pride in the fact that 84 cents of every dollar donated is invested in local people and programming. Data taken from our 2015-16 audit shows our overhead ratio, computed using the net method at 16 percent. Of that percentage, 10.36 percent is local fundraising expenses and 5.64 percent is local administrative expenses.
In 2013, GuideStar, BBB Wise Giving Alliance and Charity Navigator wrote an open letter to the donors of America in a campaign to end the Overhead Myth –the false conception that financial ratios are the sole indicator of nonprofit performance. You can learn more here: http://overheadmyth.com/.
Over the last 15 years, United Way of Southwest Minnesota has re-invested more than $5.9 million locally to benefit the lives of our friends and neighbors. We are one of a handful of southwest Minnesota non-profits to have earned the Charities Review Councils “Meet Standards Seal” for performance in Public Disclosure, Governance, Financial Activity and Fundraising Practices. Read more at: www.SmartGivers.org.
For more information about your local United Way visit www.UnitedWaySWMN.org.