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Orlando, Atlanta and Houston Charities Most Efficient At Fundraising

July 3, 2006

(July 3, 2006) Large charities in Orlando, Atlanta and Houston are the best at efficiently raising money for their causes, according to Charity Navigator’s fourth annual Metro Market Study.

The study compares the performances of the largest charities in the top 30 metropolitan areas in the United States in a variety of areas, including fundraising efficiency and expenses, annual growth, total contributions and CEO compensation, to name a few.

Overall, charities in San Diego, Cleveland and Houston are the highest rated, while those in Detroit, Indianapolis and Baltimore were the lowest rated. 2006 is the second consecutive year that San Diego’s charities have ranked first.

Regional Differences

The study revealed that regional factors, such as the cost of living, a market’s maturity and a city’s tendency to support one or two specialized causes greatly influences the ability of the charities in each city to raise money and manage costs. 

“By revealing the regional differences in the financial performance of the nation’s largest charities, in the level of support they receive and in the types of charities that exists in the various communities, we believe this report will help donors and nonprofit leaders in understanding how these differences impact that ability of charities to efficiently fulfill their missions year after year,” said Charity Navigator spokesperson Sandra Miniutti, in a press release about the study.

“For example, charities in Charlotte spend considerably less on administrative fees than charities in Philadelphia,” Miniutti continued. “This doesn’t mean that Philly’s charities are wasteful or poorly run. Rather, it shows that charities, just like for-profit enterprises, are affected by the higher costs of doing business in the Northeast, where labor costs are higher and office space is more expensive, than in the South.”

Fundraising Efficiency and Expenses

Orlando charities were not only the most efficient at fundraising (requiring, on average, only $0.065 to raise a dollar), they also spent the least on fundraising expenses (just 5.2 percent of their overall expenses). Charities in the Indianapolis area were the least efficient at fundraising (requiring $0.136 to raise a dollar, on average), while Seattle and Portland charities spent the greatest percentage of their expenses on fundraising (9.7 percent).

Cleveland and Pittsburgh’s largest charities are generally richer in assets and working capital than charities in other parts of the United States, while charities in Orlando are less financially secure.

Charities in Milwaukee (57 percent) and Cincinnati (56 percent) were the most likely to have donor privacy plans in effect; Pittsburgh (22 percent) and Boston (29 percent) have the lowest percentage of such charities.

About the Study

Data from the 2006 Metro Market Study are available on the Charity Navigator website.

In its study, Charity Navigator compared the median performance and size of the largest nonprofits in the 30 largest metropolitan markets. The data used in the study are gleaned from Internal Revenue Service Forms 990.

Charity Navigator, based in Mahwah, N.J., is the largest charity evaluator in the United States and evaluates more than 5,000 charities. It is a 501 (c)(3) organization that accepts no advertising or donations from the organizations it evaluates.

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