September 11
More Effective Collaboration Could Enhance Charitable Organizations' Contributions in Disasters Gao ID: GAO-03-259 December 19, 2002Surveys suggest that as many as two-thirds of American households have donated money to charitable organizations to aid in the response to the September 11 disasters. To provide the public with information on the role of charitable aid in assisting those affected by the attacks, GAO was asked to report on the amount of donations charities raised and distributed, the accountability measures in place to prevent fraud by organizations and individuals, and lessons learned about how to best distribute charitable aid in similar situations.
Although it may be difficult to precisely tally the total amount of funds raised in response to the September 11 attacks, 35 of the larger charities have reported raising an estimated $2.7 billion since September 11, 2001. About 70 percent of the money that has been collected by these 35 charities has been reported distributed to survivors or spent on disaster relief since September 11, 2001. Charities used the money they collected to provide direct cash assistance and a wide range of services to families of those killed, those more indirectly affected through loss of their job or residence, and to disaster relief workers. Some of the charities plan to use funds to provide services over the longer term, such as for scholarships, mental health counseling, and employment assistance. Charities and government oversight agencies have taken a number of steps to prevent fraud by individuals or organizations, and relatively few cases have been uncovered so far. However, the total extent of fraud is not known and will be difficult to assess particularly in situations when organizations solicit funds on behalf of September 11 but use the funds for other purposes. Overall, charitable aid made a major contribution in the nation's response to the September 11 attacks, despite very difficult circumstances. Through the work of charities, millions of people contributed to the recovery effort. At the same time, lessons have been learned that could improve future charitable responses in disasters, including easing access to aid, enhancing coordination among charities and between charities and the Federal Emergency Management Agency (FEMA), increasing attention to public education, and planning for future events. FEMA and some charitable organizations have taken some steps to address these issues. However, the independence of charitable organizations, while one of their key strengths, will make the implementation of these lessons dependent on close collaboration and agreement among charities involved in aiding in disasters.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-03-259, September 11: More Effective Collaboration Could Enhance Charitable Organizations' Contributions in Disasters
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Report to the Ranking Minority Member, Committee on Finance, U.S.
Senate:
United States General Accounting Office:
GAO:
December 2002:
september 11:
More Effective Collaboration Could Enhance Charitable Organizations‘
Contributions in Disasters:
GAO-03-259:
GAO Highlights:
Highlights of GAO-03-259, a report to the Ranking Minority Member,
Committee on Finance, United States Senate
Why GAO Did This Study:
Surveys suggest that as many as two-thirds of American households
have donated money to charitable organizations to aid in the response
to
the September 11 disasters. To provide the public with information on
the role of charitable aid in assisting those affected by the attacks,
GAO was asked to report on the amount of donations charities raised and
distributed, the accountability measures in place to prevent fraud by
organizations and individuals, and lessons learned about how to best
distribute charitable aid in similar situations
What GAO Found:
Although it may be difficult to precisely tally the total amount of
funds raised in response to the September 11 attacks, 35 of the larger
charities have reported raising an estimated $2.7 billion since
September 11, 2001. About 70 percent of the money that has been
collected
by these 35 charities has been reported distributed to survivors or
spent on disaster relief since September 11, 2001. Charities used the
money they collected to provide direct cash assistance and a wide range
of services to families of those killed, those more indirectly affected
through loss of their job or residence, and to disaster relief workers.
Some of the charities plan to use funds to provide services over the
longer term, such as for scholarships, mental health counseling, and
employment assistance.
Charities and government oversight agencies have taken a number of
steps to prevent fraud by individuals or organizations, and relatively
few cases have been uncovered so far. However, the total extent of
fraud
is not known and will be difficult to assess particularly in situations
when organizations solicit funds on behalf of September 11 but use the
funds for other purposes.
Overall, charitable aid made a major contribution in the nation‘s
response
to the September 11 attacks, despite very difficult circumstances.
Through the work of charities, millions of people contributed to the
recovery effort. At the same time, lessons have been learned that could
improve future charitable responses in disasters, including easing
access
to aid, enhancing coordination among charities and between charities
and
the Federal Emergency Management Agency (FEMA), increasing attention to
public education, and planning for future events. FEMA and some
charitable
organizations have taken some steps to address these issues. However,
the independence of charitable organizations, while one of their key
strengths, will make the implementation of these lessons dependent on
close collaboration and agreement among charities involved in aiding
in disasters.
[See PDF for image]
[End of figure]
What GAO Recommends:
To help facilitate collaboration among charitable organizations
involved
in disasters, GAO is recommending that FEMA convene a working group of
involved parties to take steps to implement strategies for future
disasters, building upon lessons learned in the aftermath of September
11.
The working group should address issues such as the development and
adoption
of a common application form and confidentiality agreement for use in
disasters and strategies for enhancing public education regarding
charitable
giving.
This group could include representatives of key charitable and
voluntary
organizations and foundations; public and private philanthropic
oversight
groups and agencies; and federal, state, and local emergency
preparedness
officials.
Contents:
Letter:
Results in Brief:
Background:
Charities Have Played an Unprecedented Role in the Amount of Money
Collected and Types of Assistance Provided to September 11 Survivors:
Charities and Oversight Agencies Have Several Accountability Measures
in Place; Relatively Few Cases of Fraud Identified So Far:
Little Coordination of Charitable Aid Occurred Early on, although a
More Integrated Approach Emerged Months Later:
Lessons Learned after September 11 Could Improve Future Responses but
Pose Implementation Challenges:
Conclusions:
Recommendation for Executive Action:
Agency Comments:
Appendix I: September 11th Victim Compensation Fund of 2001:
Appendix II: September 11 Fund Data for 35 Large Charities:
Appendix III: Contact Information for State Charity Officials:
Appendix IV: Members of National Voluntary Organizations
Active in Disaster:
Appendix V: Organizations Participating in 9/11 United Services Group
Service Coordination:
Appendix VI: Comments from the Federal Emergency Management Agency:
Tables:
Table 1: September 11 Fund Data for 35 Charities:
Table 2: Examples of the Range of Services Provided by the Two Largest
September 11 Charities:
Table 3: Types of Fraud and Related Accountability Measures:
Figure:
Figure 1: Amount of Aid Raised and Distributed by Selected Charities:
Abbreviations:
FEMA: Federal Emergency Management Agency:
IRS: Internal Revenue Service:
NYC: New York City:
USG: United Services Group:
United States General Accounting Office:
Washington, DC 20548:
December 19, 2002:
The Honorable Charles E. Grassley
Ranking Minority Member
Committee on Finance
United States Senate:
Dear Senator Grassley:
On September 11, 2001, America suffered terrorist attacks that resulted
in the deaths of more than 3,000 people in New York City (NYC), at the
Pentagon in Virginia, and in Pennsylvania. In addition, economists
suggest that in NYC alone, about 100,000 people may have lost their
income as a result of these events.[Footnote 1] Federal, state, and
local governments responded to this disaster in a variety of ways, and
private charities provided aid beyond that of government.[Footnote 2]
Some surveys suggest that as many as two-thirds of American households
have donated money to charitable organizations to aid in the response
to the disaster.
To provide you with information on the role of charitable aid in
assisting those affected by the attacks, you asked us to determine the
following:
(1) How much in donations have charities raised to assist September
11 survivors, and what assistance has been made available to them?
(2) What accountability measures are in place to ensure that only
eligible individuals receive aid, and what is known about fraud
committed by organizations and individuals? (3) What coordination
efforts have been pursued, if any, in response to the disaster? (4)
What lessons can be learned about how to best distribute charitable aid
in similar situations?
To answer these questions, we contacted September 11-related charities
identified by the Chronicle of Philanthropy, a key trade publication of
the nonprofit sector, and gathered information on the funds they raised
and distributed. We supplemented the Chronicle‘s list with information
we gathered from additional charities during our review. We interviewed
officials from 12 of the larger September 11-related funds in NYC and
Washington, D.C; representatives from three September 11 victims
groups; officials from various philanthropic oversight organizations;
and representatives from the major charities providing assistance after
the Oklahoma City bombing in 1995. We also spoke with officials from
the Federal Emergency Management Agency (FEMA), the federal agency
charged with responding to disasters; the NYC Office of Emergency
Management; and the Office of Family Policy of the Department of
Defense. Finally, we interviewed officials from government oversight
agencies, including the Internal Revenue Service (IRS), officials from
state charity offices or attorneys general offices in seven states, and
the New York County (Manhattan) District Attorney‘s Office. We
conducted our review from January through November 2002 in accordance
with generally accepted government auditing standards. We did not
independently verify data provided by the charitable organizations or
oversight officials, and it was not within the scope of our work to
review the charities‘ systems of internal control or to trace their use
of funds. On September 3, 2002, we issued an interim report on the
results of our review.[Footnote 3]
Results in Brief:
Although it may be difficult to precisely tally the total amount of
funds raised, 35 of the larger charities have reported raising almost
$2.7 billion since September 11, 2001. About 70 percent of the money
that has been collected by these 35 charities has been distributed to
survivors or spent on disaster relief as of October 31, 2002. Fund
distribution rates vary widely among this group of charities, in part
because of differences in their operating purpose. For example, some
charities were established to provide immediate assistance, while
others, such as scholarship funds, were established to provide services
over a longer period of time. Charities reported distributing these
funds for cash grants and a wide range of services to families of those
killed, those more indirectly affected through loss of their job or
residence, and to disaster relief workers. Questions about how best to
use the funds as well as service delivery difficulties complicated
charities‘ responses. For example, to distribute aid, charities had to
make extensive efforts to identify victims and survivors as there were
no uniform contact lists for families of victims. In addition,
charities faced challenges in providing aid to non-English speaking
people in need of assistance. Some charities have focused their efforts
on these individuals.
Charities and government oversight agencies have taken a number of
steps to prevent fraud by individuals or organizations, and relatively
few cases have been uncovered so far. Most charities we spoke with
required applicants to provide documentation certifying identity,
injury, death of a family member, or loss of job or home, and may have
asked for proof of financial need. State attorneys general and local
district attorneys also told us that although they had limited
resources available to address September 11-related fraud, they are
actively responding to public concerns about charities. While
information is available on identified fraud cases, the total extent of
fraud is not known, and it will be difficult for charities and
oversight agencies to assess.
Despite some early efforts, little coordination of charitable aid
occurred early on, although a more integrated approach emerged some
months later. Even with these efforts, September 11 survivors generally
believed they had to navigate a maze of service providers, and both
charities and those individuals who were more indirectly affected by
the disaster were confused about what aid might be available. Although
steps were taken to address some of these issues in previous disasters,
the scope and complexity of the September 11 attacks presented a number
of challenges to charities in their attempts to provide seamless social
services for surviving family members and others in need of aid. Some
months after the disaster, however, oversight agencies and large
funders established a more coordinated approach. This included the
formation of coordinating entities, the implementation of case
management systems, and attempts to implement key coordination tools,
such as client databases.
Charities, government agencies, watchdog groups, and survivors‘
organizations shared with us lessons that could improve the charitable
aid process in disasters in the future. These lessons include easing
access to aid for those who are eligible, enhancing coordination among
charities and between charities and FEMA, increasing attention to
public education on charitable giving, and planning for future events.
Some efforts are under way to address these issues. However, the
independence of charitable organizations, while one of their key
strengths, will make implementation of these lessons learned dependent
on close collaboration and agreement among these independent
organizations. To help facilitate collaboration among charitable
organizations involved in disasters, we are recommending that FEMA
convene a working group of involved parties to take steps to implement
strategies for future disasters, building upon lessons learned in the
aftermath of September 11. In commenting on a draft of this report,
FEMA agreed with our recommendation and said that such a working group
would likely foster enhanced coordination and collaboration and
potentially lead to improvements in service to those affected by
disasters.
Background:
Charities are organizations established to address the needs of the
poor or distressed and other social welfare issues. Federal, state, and
private agencies and the American public monitor how well charities are
meeting these needs. Although not all charities have a disaster relief
focus, historically charities have adapted their work as needed to the
immediate or longer-term needs of disaster survivors. In these disaster
aid efforts, charities may cooperate with FEMA. Though charities and
FEMA have a substantial role in providing disaster aid, people affected
by disasters may also pursue other government or private sources of
relief.
Purpose and Scope of the Charitable Sector:
Charities represent a substantial presence in American society.
Internal Revenue Code Section 501(c) establishes 27 categories of tax-
exempt organizations; the largest number of such organizations falls
under Section 501(c)(3), which recognizes charitable organizations,
among others. The term charitable, as defined in the regulations that
implement Section 501(c)(3), includes:
* assisting the poor, the distressed, or the underprivileged;
* advancing religion, education, or science;
* erecting or maintaining public buildings, monuments, or works;
* lessening neighborhood tensions;
* eliminating prejudice and discrimination;
* defending human and civil rights; or
* combating community deterioration and juvenile delinquency.
An organization must apply for IRS recognition as a tax-exempt charity
that strives to meet one or more of these purposes. In general, a
charity serves these broad public purposes, rather than specific
private interests. By 2000, IRS had recognized 1.35 million tax-exempt
organizations under Section 501(c), of which 820,000 (60 percent) were
charities. At the end of 1999, the assets of Section 501(c)(3)
organizations approached $1.2 trillion and their annual revenues
approached $720 billion. Charities pay no income taxes on contributions
received, but they can be taxed on income generated from unrelated
business activities.
Oversight of Charities:
Federal agencies, state charity officials, other nonprofit
organizations, and the general public may all participate in overseeing
charitable operations to protect the public interest. At the federal
level, IRS has primary responsibility for recognizing tax-exempt status
and determining compliance with tax laws, such as those governing the
use of charitable funds.[Footnote 4] Notwithstanding these powers, IRS
is not generally responsible for overseeing how well a charity spends
its funds or meets its charitable purpose.
Despite the federal government‘s significant indirect subsidy of
charities through their tax-exempt status and the allowance of
charitable deductions by individuals, the federal government has a
fairly limited role in monitoring charities, with states providing the
primary oversight of charities through their attorneys general and/or
charity offices. These officials maintain registries of charities and
professional fundraisers, including financial reports of registrants.
They also monitor the solicitation and administration of charitable
assets. Attorneys general and state charity officials have extensive
power to investigate charities‘ compliance with state law and can
correct noncompliance through the courts. Although local law
enforcement agents, such as district attorneys, may assist the state
with investigations of charities, they tend to focus on the prosecution
of the criminal cases of individuals who defraud charities.
Further oversight of charities‘ efficiency and effectiveness is likely
to be carried out by the private sector, including ’charity watchdogs,“
and the American public. Watchdogs such as the Better Business Bureau‘s
Wise Giving Alliance and publications such as The Chronicle of
Philanthropy are the public‘s primary sources for information on
charitable organizations and fund-raising. The questions and concerns
people bring to the attention of watchdogs and government officials are
often the key motivators for initiating investigations.
Charities‘ Roles in Disasters:
Charities have historically played a role in the nation‘s response to
disasters. First, some charities, for example, the American Red Cross
or the Salvation Army, are equipped to arrive at a disaster scene and
provide mass care, including food, shelter, and clothing, and in some
circumstances, emergency financial assistance to affected persons.
Next, depending on the extent and nature of devastation to a community
and charities‘ typical services and capacities, some charities are best
structured to provide longer-term assistance, such as job training or
mental health counseling. Finally, new charities may form post-disaster
to address the needs of all survivors or specific population groups.
For example, after the September 11 attacks, charities were established
to serve survivors of restaurant workers and firefighters.
FEMA is the lead federal agency for responding to disasters and may
link with charitable organizations to provide assistance. According to
FEMA regulations, in the event of a presidentially declared disaster or
emergency, such as September 11, FEMA is required to coordinate relief
and assistance activities of federal, state, and local governments; the
American Red Cross; the Salvation Army; and the Mennonite Disaster
Service; as well as other voluntary relief organizations that agree to
operate under FEMA‘s direction. Although charities are expected to be
among the first agencies to provide assistance to those affected, in
the event of some natural disasters, FEMA may anticipate need and be
the first to respond. FEMA can provide a range of assistance to
individual disaster survivors. In a natural disaster, such as a
hurricane or flood, the bulk of FEMA‘s individual assistance program
money tends to be given to individuals whose residences have been
damaged. September 11 presented a different challenge for the agency:
few people had damage to their homes, but many needed unemployment
assistance and help paying their mortgage or rent.
Other Sources of Disaster Relief Assistance:
Though FEMA and charities provide key resources to survivors of
disasters, a range of additional aid may be available for those
affected by the September 11 attacks.[Footnote 5] Federal sources of
aid to individuals include Social Security, Medicaid, Disaster
Unemployment, and Department of Justice benefits for fallen police
officers and firefighters.[Footnote 6] In addition, the Congress has
set up a Federal Victim Compensation Fund for individuals injured and
families of those who died in these attacks. See appendix I for more
information about this fund. From states, survivors may obtain State
Crime Victim Compensation Board funds, unemployment insurance, or
workers‘ compensation. Some families may also be able to access private
insurance or employer pensions.[Footnote 7]
Charities Have Played an Unprecedented Role in the Amount
of Money Collected and Types of Assistance Provided to September 11
Survivors:
While it may be difficult to tally precisely the total amount of funds
collected, 35 of the larger charities have raised almost $2.7 billion
and distributed about 70 percent of the money. Distribution rates vary
widely among the charities, in part, because some were established to
provide immediate assistance while others were established to provide
assistance over the longer term. Charities used the money they
collected to provide cash and a broad range of services to people
directly and indirectly affected, although questions about how best to
use the funds as well as service delivery difficulties complicated
charities‘ responses.
Of the Larger Charities,
35 Have Raised Almost $2.7 Billion; Most Aid Collected Has Already Been
Distributed:
Thirty-five of the larger charities have raised almost $2.7 billion as
of October 31, 2002, to aid the survivors of the terrorist attacks.
(See table 1.) These include a range of organizations, including large,
well-established organizations such as the American Red Cross and the
Salvation Army and other organizations created specifically in response
to September 11, such as the Twin Towers Fund. While the total amount
raised may increase over time, many organizations are no longer
actively collecting funds. For example, The September 11th Fund stopped
soliciting donations in November 2001 and in January 2002 asked the
public to stop sending contributions to the fund.
Table 1: September 11 Fund Data for 35 Charities:
Relief charities: American Red Cross Liberty Fund; Amount raised:
$1,011,000,000.
Relief charities: The September 11th Fund; Amount raised: 512,000,000.
Relief charities: Twin Towers Fund; Amount raised: 205,000,000.
Relief charities: International Association of Fire Fighters; Amount
raised: 161,000,000.
Relief charities: New York Police and Fire Widows‘ & Children‘s Benefit
Fund; Amount raised: 117,000,000.
Relief charities: Citizens‘ Scholarship Foundation; Amount raised:
113,167,336.
Relief charities: Salvation Army; Amount raised: 87,722,612.
Relief charities: Uniformed Firefighters Association; Amount raised:
71,000,000.
Relief charities: New York State World Trade Center Relief Fund[A];
Amount raised: 68,730,000.
Relief charities: New York Times 9/11 Neediest Fund; Amount raised:
61,147,017.
Relief charities: Robin Hood Foundation; Amount raised: 60,300,000.
Relief charities: Catholic Charities USA; Amount raised: 31,847,514.
Relief charities: Catholic Charities of NY; Amount raised: 25,400,000.
Relief charities: Survivors Fund; Amount raised: 20,000,000.
Relief charities: Windows of Hope; Amount raised: 19,000,000.
Relief charities: World Vision; Amount raised: 12,428,378.
Relief charities: New York State Fraternal Order of Police Foundation;
Amount raised: 12,028,314.
Relief charities: Port Authority Police Benevolent Association; Amount
raised: 11,642,025.
Relief charities: NYC Police Foundation; Amount raised: 11,000,000.
Relief charities: Americares Foundation; Amount raised: 9,261,073.
Relief charities: Navy-Marine Corps Relief Society; Amount raised:
6,800,000.
Relief charities: Army Emergency Relief; Amount raised: 5,792,588.
Relief charities: Federal Employee Education & Assistance Fund; Amount
raised: 5,500,000.
Relief charities: United Jewish Communities; Amount raised: 4,800,000.
Relief charities: United Way National Capital; Amount raised:
3,956,512.
Relief charities: Union Community Fund; Amount raised: 3,092,105.
Relief charities: Lions Clubs International Foundation; Amount raised:
3,023,000.
Relief charities: Rotary International; Amount raised: 1,800,000.
Relief charities: American Society for the Prevention of Cruelty to
Animals; Amount raised: 1,744,000.
Relief charities: Kiwanis International Foundation; Amount raised:
1,591,916.
Relief charities: Tides Foundation; Amount raised: 597,207.
Relief charities: Jewish Federation of Greater Washington; Amount
raised: 450,000.
Relief charities: National Italian American Foundation; Amount raised:
334,000.
Relief charities: Farmers‘ Market Federation of NY; Amount raised:
162,000.
Relief charities: American Lung Association; Amount raised: 139,000.
Relief charities: Total; Amount raised: $2,660,456,597.
Source: Data provided by charities. Most data are as of October 31,
2002, unless otherwise noted in appendix II.
Note: We asked the charities to exclude funds they had received from
other September 11 funds to avoid overstatement of the funds involved.
[A] This is not a charity; the New York State Department of Taxation
and Finance established and administers this fund of donations.
[End of table]
The large number of charities collecting funds for September 11
complicates the efforts to determine a precise count of the total funds
raised. The Metro New York Better Business Bureau Foundation has
identified 470 September 11-related charities, and the IRS estimates
that about 600 charities are involved in September 11-related
fundraising. The IRS took steps to quickly grant tax-exempt status to
about half of these 600 charities after September 11.[Footnote 8] While
some of these new charities appear to be smaller, specific fundraising
events such as the Hike of Hope, others like the Twin Towers Fund,
which raised $205 million, became major charities. While any one
charity will have information on its funding and services, the
charitable sector as a whole generally does not have reporting
mechanisms in place to track funds across entities or for any one
event. Some tracking efforts are under way, however. For example, the
Metro New York Better Business Bureau Foundation recently surveyed the
470 September 11-related charities they identified and 270 responded to
its request for fund information.
Further complicating a precise tally of funds is the interfund
transfers that occurred among charities. For example, the Americares
Foundation raised $5.3 million in its Heroes Fund and transferred it to
the Twin Towers Fund to be distributed. Likewise, the United Jewish
Federation of New York distributed $5.4 million in grants it received
from the New York Times
9/11 Neediest Fund and the United Jewish Communities of North America.
The Metro New York Better Business Bureau Foundation estimates that
more than $400 million of the charitable aid it is tracking represents
duplicate listings of money raised by grant-making organizations and
the direct service providers they are funding. Moreover, an unknown
number of corporations have sold and are still selling products for
which some portions of the proceeds are to be donated to September 11
charities, a practice known as ’cause-related marketing.“ Some reports
cite hundreds of products being sold in the name of September 11
charities; the extent to which these funds have already been forwarded
to charities is not known.
A more complete accounting of the number of September 11 charities and
the amounts they raised might be possible when all charitable
organizations have filed with IRS the required annual information form,
called the IRS 990. Among other items, these tax-exempt
501(c)(3) organizations must report on their total revenues (including
donations), expenses, grants and allocations, and the total dollars of
specific assistance they provided to individuals.[Footnote 9] This form
is due in the fifth month after the close of the organization‘s taxable
year. As IRS
990 forms for these charities become available, examination of them may
yield more information; however, the way these data are reported may
not necessarily allow a precise accounting of dollars raised for
September
11. For example, pre-existing charities that served other purposes as
well as September 11, may not report funding data at the level of
detail that would link spending to September 11 purposes.
Fund Distribution Rates Varied, Reflecting Different Charitable Goals
and Purposes:
Of the almost $2.7 billion estimated collected by the larger 35
charities, about $1.8 billion, or 70 percent, has been reported
distributed as of October 31, 2002. Fund distribution rates, however,
vary widely from less than 1 percent to 100 percent, in part because of
the differing goals and purposes of the charities. For example, some
charities with high distribution rates like the New York Times 9/11
Neediest Fund or the United Way of the National Capital Area are
primarily fundraisers that make grants to direct service providers such
as the Children‘s Aid Society and the Salvation Army, which provide
immediate assistance to survivors. Other charities, particularly those
that will be providing scholarship assistance to survivors like the
Citizens‘ Scholarship Foundation, the Navy-Marine Corps Relief Society,
the Army Emergency Relief, and Windows of Hope, have much lower
distribution rates that reflect the longer-term missions of their
charities. Figure 1 shows the amount of aid raised and distributed by
charities. See appendix II for the amount of funds raised, distributed,
and distribution rates for each of the 35 charities.
Figure 1: Amount of Aid Raised and Distributed by Selected Charities
[See PDF for image]
[End of figure]
Charities Provided Cash and a Broad Range of Services to People
Directly and Indirectly Affected:
Charities provided a wide range of assistance to the different
categories of individuals affected, including the families of those
killed, those indirectly affected through the loss of a job or
displacement from their home, and services provided to the rescue
workers and volunteers, as shown in table 2. A full accounting of the
range of services provided is difficult to ascertain, as many large
funders have provided grants to multiple service providers. For
example, The September 11th Fund has provided grants to over 100
organizations, including direct service providers like Safe Horizon,
which provide assistance to families and communities and to rescue and
recovery efforts.
Table 2: Examples of the Range of Services Provided by the Two Largest
September 11 Charities:
Charity: American Red Cross - Liberty Fund; Directly affected: 3,396
survivor families received 12 months‘ living expenses, averaging
$58,900 per family ($200 million total), and each estate will receive
$45,000; Indirectly affected: 55,000 families who lost jobs or income
or had damaged homes received 3 months‘ living expenses ($276
million); Immediate disaster relief: 14 million meals for disaster
workers and survivors; Other: 236,000 mental health counseling visits
and; 131,000 health service visits.
Charity: The September 11th Fund; Directly affected: 3,500 survivors
received $20,000 each; Indirectly affected: 35,000 displaced workers
and 3,000 displaced residents received $4,000 - $10,000 each;
Immediate disaster relief: 343,000 meals served to rescue workers; ;
4.3 million pounds of food were delivered to ground zero; Other:
20,000 people received mental health counseling and referrals, and
10,000 people received legal advice; ; 15,000 people who lost jobs
received training, career counseling, or placement services; ; Nearly
1,000 small businesses and nonprofits received grants or loans to help
rebuild the community.
Source: Data provided by charities as of October 31, 2002, does not
include future or planned distributions.
[End of table]
Families of those killed on September 11 have received cash gifts from
various charities to help them through the first year of the recovery
process. McKinsey‘s survey of nonuniformed World Trade Center families
showed that 98 percent of families reported receiving cash assistance
averaging $90,000 per family.[Footnote 10] Because of the charities
specifically established to assist the survivors of the firefighters
and police killed in the attacks, their survivors will receive more
cash assistance than survivors of the nonuniformed people killed. A
Ford Foundation study reports that uniformed rescue workers funds have
provided families of the Port Authority Police and NYC Police and
Firefighters with cash benefits of $715,000, $905,000, and $938,000,
respectively.[Footnote 11]
It was a change in IRS rules and subsequent legislation that enhanced
the abilities of charities to distribute aid on a per capita basis--as
did some of the charities focused on those firefighters and police
killed--rather than on the basis of more in-depth needs assessment. IRS
rules governing the uses of charitable aid were changed for September
11 survivors. Recognizing the unique circumstances caused by this
tragedy and in anticipation of congressional legislation that was
subsequently passed, IRS relaxed the burden on charities--in the case
of this disaster only--to show that the assistance provided was based
on need.[Footnote 12] In November 2001, IRS issued guidance that
authorized charities to make payments to September 11 victims and their
families without a specific needs test, if made in good faith and using
objective standards. Some charities and oversight agencies we spoke
with said that this placed some charities under pressure to more
quickly distribute their funds. It allowed others, such as the
International Association of Fire Fighters, to distribute funds on a
per capita basis, regardless of need, to the surviving families of
those who perished, a practice that had not been permitted prior to the
September 11 disasters.
Charities‘ Responses Complicated by Questions about Use of Funds and
Difficulties Reaching Those in Need:
Questions about how aid should be distributed as well as problems
identifying and serving thousands of people directly and indirectly
affected complicated charities‘ tasks as they moved to aid those
affected by the attacks.
Different Perspectives on Appropriate Use of Funds Complicates
Distribution:
Charities faced considerable debate on how their funds should be
distributed--to whom, for what, and when? Some victims‘ groups and
charities believe the money should be in the form of cash grants,
distributed as quickly as possible, and typically focused on families
of those killed, believing that the survivors are in the best position
to understand and deal with their individual needs. Other charities and
oversight organizations believe that needs are best met when the
charitable funds take into account a broad range of needs, including
those in the long term, and focus on services rather than cash
grants.[Footnote 13] For example, Oklahoma City charities emphasized
needed services rather than cash grants.
While most of the September 11 funds have been distributed in the first
year, some charities are planning to provide services over the longer
term. The American Red Cross announced that it is setting aside $133
million to be spent over the next 3 to 5 years primarily in the areas
of mental health and uncovered health care costs. The September 11th
Fund announced that it will use its remaining $170 million over the
next 5 years to also fund services such as mental health counseling,
employment assistance, health care, and legal and financial advice. In
addition, the Survivors‘ Fund, the largest fund set up exclusively to
support the needs of survivors of the Pentagon attack, is focusing its
services on the long-term needs of the survivors.
Since the attacks, decisions made by the American Red Cross--by far the
largest holder of funds for September 11 purposes--were the focus of
much media and congressional scrutiny, raising concerns about its plans
for funds raised. By the middle of November 2001, contributions to the
American Red Cross‘s Liberty Fund reached nearly $543 million. The
American Red Cross had established the Liberty Fund to help people
affected by the September 11 attacks, its aftermath, and other
terrorist events that could occur in the near future. While American
Red Cross officials said that from early on it used its traditional
language in its fund appeals saying that funds raised would be used for
’this and other disasters,“ it was widely perceived as a violation of
the donors‘ intent in this case. In response to concerns about the
organization‘s use of funds, on November 14, 2001, the American Red
Cross pledged that the entire Liberty Fund would be spent to care for
those directly and indirectly affected by the September 11 attacks,
their families, and the rescue workers. Fulfillment of donor intent is
an important issue, and many charities we spoke with said that they
were keeping their spending within the framework of what they believed
donors wanted: to quickly meet the needs of those for whom aid is
intended.
Representatives from philanthropic oversight organizations said
charities in general could have minimized some of the problems they
faced by paying more attention to the public relations aspects of their
work.[Footnote 14] This might have reduced adverse publicity when
people expected one thing and charities did another. Problems these
representatives cited include the following:
* Some charities made vague appeals for money, and the public didn‘t
understand what programs these funds might support.
* Victims and the needs of the survivors were too narrowly defined.
Some charities communicated a simplistic definition of those needing
help as only the survivors of those people who were killed or those who
were injured in the terrorist attacks. However, in the September 11
disasters, thousands of others were displaced from their homes, lost
their jobs, and needed counseling to cope with post-traumatic stress
disorder.
* Some charities implied that all of the funds collected would go to
direct assistance without any management and administrative cost. This
created a misperception that services could be delivered without
trained professionals, administrative back offices, support staff, or
personnel to help ensure accountability in the use of the donated
funds.
Identifying and Reaching Those in Need Posed Significant Difficulties:
Charities told us that they had to make extensive efforts to identify
the people who were killed and locate their survivors, as there were no
uniform lists, and privacy issues affected the sharing of information.
For example, when the Robin Hood Foundation wanted to provide $10,000
cash gifts to the surviving families, it found it had to develop its
own list of the people who were killed and contact information for
their survivors. The foundation recruited volunteers to contact World
Trade Center employers and reported having to sign 55 different
confidentiality agreements with companies, airlines, and individuals,
to ensure that Robin Hood Foundation would not share its list with
other agencies. In the case of those killed and injured at the
Pentagon, confidentiality was a concern as well. The Pentagon provided
the Foundation with a list of beneficiary names for the checks but sent
a representative to New York to put the checks in the envelopes and
apply the address labels.
Charities made many efforts to reach out to hard-to-serve clients, non-
English speakers, and immigrants. For example, the New York Immigration
Coalition received $800,000 from The September 11th Fund and money in
other grants to provide legal assistance, establish immigrant help
desks at each disaster center, and train charity workers on how to
better reach immigrants. The NYC Department of Health reported that
20 percent of those killed in NYC were foreign-born, coming from
167 different countries. Charity officials said the Immigration and
Naturalization Service facilitated their efforts to reach immigrants by
announcing it would not pursue information on the immigration status of
individuals. Also, some charities such as Windows of Hope were created
to specifically serve low-income restaurant workers with language
barriers.
In spite of outreach efforts, representatives from the victims groups
we spoke with said that survivors were not aware of all charitable
services and assistance available. A recent study of dislocated
hospitality-industry workers in the Washington, D.C., region also
reported that despite the efforts to meet the needs of these workers,
many still struggled to connect with services.[Footnote 15] Workers
interviewed for the study said a single source of information and
referrals for emergency assistance, job placement assistance, or job
training would have been helpful.
In addition, some people we spoke with in NYC expressed concern that
many indirectly affected survivors did not qualify for assistance
because they lived outside the geographic area below Canal Street in
Manhattan, which was initially targeted for aid by FEMA and many
charities. After much public concern about the limited geographic range
of FEMA‘s eligibility regulations, in August 2002, the Congress
mandated FEMA to expand its mortgage and rental assistance to employees
working anywhere in Manhattan and to those who could track job loss or
loss of income to September 11.[Footnote 16] FEMA also provides this
assistance to those workers whose employers are not located in
Manhattan, but who are economically dependent on a Manhattan firm, and
anyone living in Manhattan, who commuted in and out of the island and
who suffered financially because of post-September 11 disruptions.
Charities and Oversight Agencies Have Several Accountability Measures
in Place; Relatively Few Cases of Fraud Identified So Far:
Charities and government oversight agencies have taken a number of
steps to prevent fraud, and relatively few cases have been uncovered so
far. For example, to minimize fraud by individuals, some charities
required applicants to provide documentation certifying their needs and
the relationship of their need to the disaster. Also, some charities
conducted independent reviews of their applications and eligibility
processes. State attorneys general and local district attorneys told us
that although they had limited resources to dedicate to such efforts,
they are actively responding to public concerns about charities.
Officials from these government oversight agencies pursued
investigation of fraud by individuals and charities; most of the few
cases of fraud being prosecuted or investigated in New York relate to
individuals who are charged with or have been convicted of falsely
obtaining assistance.
A Range of Accountability Measures Are in Place to Address Different
Types of Fraud:
Different types of fraud can occur in the solicitation and delivery of
charitable funds: fraud by individuals, charities, and businesses, as
shown in table 3. Charity and oversight agency officials told us that
they employed a number of methods to prevent this fraud, as also shown
in table 3. Most charities we spoke with required applicants to provide
documentation certifying identity, injury, death of a family member, or
loss of job or home, and may have asked for proof of financial need,
for example, paycheck stubs. To verify that they were adequately
screening for fraud, some charities conducted independent reviews of
their eligibility processes. State charity officials and local district
attorneys typically relied heavily on complaints from the public and on
the charities themselves to identify ineligible individuals or
fraudulent charitable groups or solicitations.[Footnote 17] These
officials also reached out to a number of professional groups,
including presentations to fund-raising associations and charity boards
about state guidelines on charitable solicitation. Finally, they also
issued educational press releases, suggesting that people should
examine charities before they write checks. See appendix III for
contact information for each state‘s charity oversight agency.
Table 3: Types of Fraud and Related Accountability Measures:
Different types of fraud possible: By individual - Fraudulent claims of
eligibility for a charity‘s funds or services can include; * claiming
survivor benefits using a false death certificate, a forged identity,
or by falsely overstating connections to a victim or; * falsely
representing need for job-related or housing benefits; Accountability
measures in place to prevent or detect fraud: * Charities‘ eligibility
screening, including document checking; * Charities‘ internal audits
of the screening process; * Police or district attorney investigations
(either initiated by charities or by law enforcement).
Different types of fraud possible: By group or organization (’charity“)
-; * Solicitation of funds by those pretending to represent a
charitable cause or; * using September 11 to solicit funds but using
the funds raised for an unrelated purpose; Accountability measures in
place to prevent or detect fraud: * Complaints by the general public or
charity watchdogs; * Attorneys general investigations; * External
audits by accounting firms; * IRS review; * Police or district
attorney investigations.
Different types of fraud possible: By business - Cause-related
marketing, or any arrangement that results in a charity receiving a
percentage of sales, can result in a charity receiving few or no
benefits; Accountability measures in place to prevent or detect fraud:
* Charities monitor media and attend to questions from the public; *
State attorneys general may require submission of a contract between
the charity and the business; * Police or district attorney
investigations.
Source: Public and private philanthropic oversight officials and
charities.
[End of table]
Charities and Oversight Agencies Reported Relatively Few Cases of
Fraud:
Charities, state attorneys generals, and local district attorneys we
spoke with said that they have found relatively few cases of fraud by
charities or individuals. Charities like Safe Horizon told us that they
were developing relationships with local law enforcement and had
referred a number of suspicious cases to the police department.
Furthermore, charities‘ internal audits identified additional
potential cases of fraud. For example, the American Red Cross‘s review
identified 350 suspected cases of fraudulent claims on its Liberty
Fund, representing less than 1 percent of distributed funds. State and
local oversight officials told us that although they did not have
additional resources available to address September 11-related fraud,
they are actively pursuing any fraud identified. They reported that
since September 11, they had found relatively few cases of fraud,
either by charities or individuals.[Footnote 18] These attorneys
general and state charity officials from the seven states that suffered
high numbers of casualties from September 11 told us they are
investigating a combined total of
17 suspected cases of fraudulent solicitation of funds. Local officials
indicate that they have more reports of individual fraud than charity
fraud. For example, the New York County District Attorney‘s Office
reported that as of October 15, 2002, it had arrested 84 people for
individual fraud and
2 people for fraudulent solicitation of funds. Representatives of this
district attorney estimated that about $1 million in aid has been
fraudulently obtained. The following are examples of suspected
individual fraud uncovered to date by the New York County District
Attorney‘s Office.[Footnote 19]
* One man staged his own death in the Trade Center, then, posing as his
next of kin (a recently deceased brother), applied for and received
over $272,000 from two charities.
* Another NYC man reported that his 13th child had accompanied him to a
job interview at the World Trade Center and had perished in the attack.
The investigation revealed that the child never existed, a fact
confirmed by other family members. The man received $190,867 from two
charities.
* A group of cafeteria employees in a building near the Trade Center
were paid for 4 days of work when their building was closed post-
disaster. One employee applied for disaster-related income replacement
for those 4 days (even though he had been paid) and received funds.
This employee told his co-workers about his success in obtaining
charitable aid under pretense, and 23 of his colleagues attempted to do
the same.
* A man hired 13 homeless people to help him defraud charities. He
supplied the homeless people with fraudulent documentation of job loss
and financial need, then drove them around to relief sites around the
city, where they applied for and received a total of $108,905 from
charities.
In addition, the New York State Attorney General‘s Office reported
investigating approximately 20 additional cases of individual fraud,
many of which are related to individuals who allegedly attempted to
obtain false death certificates.
While information is available on identified fraud cases, the total
extent of fraud is not known and will be difficult for oversight
agencies and charities to assess. First, detection of fraud by
individuals could be challenging, despite checks being in place, as
charities said they were overwhelmed by the volume of applications for
assistance and had to hire new staff or volunteers to help them manage
their relief efforts. The potential for fraud by individuals may have
increased, as the new personnel may have been unfamiliar with the
charities‘ eligibility regulations and may have inappropriately
distributed or denied funds. Second, fraud detection may be
particularly problematic in areas such as cause-related marketing by
businesses. For example, the executive director of the Twin Towers Fund
told us he was unaware of a record company‘s marketing campaign on the
fund‘s behalf, until he read about it in the newspaper. The charity had
to contact the record company, then set up a contract to formalize the
terms of the fundraising. Third, it may also be difficult to track
fund-raising by groups using September 11 to solicit for other
purposes. In one state, oversight officials told us that an
organization conducted a telemarketing drive promising that funds would
be given to ’firefighters, like those who died September 11,“ but no
funds went to the survivors of firefighters who died in the attacks.
Oversight agencies said that these types of organizations tended to
move very quickly in and out of geographic areas, making it difficult
to find and prosecute them.
Little Coordination
of Charitable Aid Occurred Early on, although a More Integrated
Approach Emerged Months Later:
Despite some early cooperation attempts, survivors had difficulty
accessing charitable aid. The unprecedented scope and complexity of the
September 11 disasters presented a number of challenges to charities in
their attempts to provide seamless social services for those in need of
assistance. Some months after the disaster, however, oversight agencies
and large funders worked to establish a more coordinated approach at
the September 11 attack sites. This included the formation of
coordinating entities, the implementation of case management systems,
and attempts to implement key coordination tools, such as client
databases.
Despite Early Charity Response Efforts, Survivors Experienced
Difficulty Accessing Aid:
Following the disasters, charitable organizations and FEMA took some
immediate steps to help survivors get assistance, including checking in
with other agencies. Charities moved quickly to collect funds, give
grants to service providers, and establish 800 numbers and Web sites
with aid information. FEMA headquarters contacted charities likely to
be active in disaster relief to discuss how FEMA contacts would be of
assistance. Some efforts at formal coordination include Family
Assistance Centers and Disaster Assistance Service Centers, where some
of the larger charities and government agencies set up booths to
provide assistance to survivors and those economically affected by the
disaster.[Footnote 20] The United Way of the National Capital Area held
information-sharing meetings for Washington and Virginia service
providers and the New York Community Trust did so as well.
Despite these efforts, September 11 survivors generally believed that
they had to navigate a maze of service providers in the early months,
and both charities and those individuals who were more indirectly
affected by the disaster (e.g., by job loss) were confused about what
aid might be available. Survivors and charities told us that aid
distribution was hindered by a number of factors. First, those seeking
aid had to fill out a separate application and provide a unique set of
documentation for each charity to which they applied. Second, in the
early stages post-disaster, all survivors had to apply in person for
charitable assistance, even if they had previously obtained aid from
the organization. This became troublesome for the many survivors who
did not live in metropolitan New York or Washington. Charities like
Pennsylvania September 11th Assistance ended up paying for survivors‘
travel to the Liberty Park Family Assistance Center in New Jersey.
Third, over the course of the first few weeks after the disaster, many
dimensions of coordination were limited by little information sharing
between organizations helping survivors. For example, some charities
said that they were not familiar with other organization‘s rules,
especially FEMA‘s. Furthermore, because of privacy laws, charities and
FEMA did not share information about clients with each other; as a
result, in early stages of service delivery, charities might have
duplicated services to clients.
Although ways to address some of these issues have been used in the
past, the scope and complexity of the September 11 disasters presented
a number of challenges to charities in their attempts to provide
seamless social services for survivors of the disaster. In the
aftermath of the Oklahoma City bombing, charities and service providers
worked together to create a database of aid recipients, provide each
recipient a case manager, and to participate in a long-term recovery
committee to better coordinate aid, fostering a more integrated service
delivery approach. The September 11 events differed in key ways that
hindered a similar approach:
* A much larger and more diverse number of actual and potential aid
recipients. The 168 Oklahoma City victims who were killed were a more
homogeneous population of federal government workers, while the World
Trade Center disaster alone had 2,795 victims from a number of
businesses and 167 countries. In addition, thousands more than in
Oklahoma City were indirectly affected through loss of their jobs and
homes.
* Numerous governmental jurisdictions. The September 11 attacks
occurred in three states, which involved multiple government entities
at each site.
* Larger numbers and multiple layers of funders and grantees. In
addition to existing charities that were already involved in disaster
relief services, the hundreds of new charities that emerged to provide
aid to families of those killed were involved.
A More Integrated Approach Emerged Later:
Some months after the disaster, oversight agencies and large funders
worked to establish a more coordinated approach at the September
11 attack sites. This approach included the formation of coordinating
entities, the implementation of case management systems, and attempts
to implement key coordination tools.
Several coordination efforts emerged at the disaster sites. In NYC, the
State Attorney General had encouraged charities to work together to
ease access to aid, including use of a common application form and
database. The 9/11 United Services Group (USG), a consortium of human
service organizations and their affiliated service coordinators, was
formed in December 2001 to foster a more coordinated approach to aid
delivery. (See appendix V for a list of USG organizations participating
in USG service coordination.) Furthermore, in the spring of 2002, FEMA
successfully established long-term recovery committees in New York and
New Jersey for charities that had smaller September 11 funds than those
of USG. In Virginia, the Survivors‘ Fund set up a board to assess the
unmet needs of survivors and persons who were economically displaced by
the disasters. Members of this board include key area agencies, such as
the United Way and FEMA, which have historically facilitated
coordination in areas affected by disasters.
As coordination efforts progressed, some charities continued to follow
Oklahoma‘s model by establishing case managers for individuals who lost
family members in the attacks. Although all the charities were familiar
with a case management model, cross-agency case management presented
challenges, as agencies‘ mission statements or regulations specified
different qualifications and specializations of their social workers
(e.g., Master‘s degree required). Despite these challenges, USG‘s
service coordinator program involves the efforts of a number of
charities across the city. If families need help, they can call the
Safe Horizon hotline, and an operator there assesses whether the
clients have short-or long-term needs, his or her geographic area, and
the clients denominational or ethnic preferences for service providers,
and then connects them with a 9/11 USG service coordinator.
Coordinators are current staff of local charities and have been trained
by USG to help survivors identify and access a broad range of
services.[Footnote 21] They have access to a number of technology
tools, including an automated centralized directory of benefits and
services available to families and a community website that allows
service coordinators to communicate with the entire service coordinator
community. Service coordinators, key charity managers, and the New York
FEMA Voluntary Agency Liaison also meet weekly to discuss service
provision issues. The Survivors‘ Fund in Virginia also set up case
managers but contracted with another agency to hire new social workers
to provide case management services to the injured and families of
those killed in the Pentagon attacks.
Agencies began to develop client databases and a common application
form for disaster relief aid. One key advantage of client databases is
that the services clients had already received could be tracked by the
charities, and as such, would prevent duplication of services. Although
many charities expressed concern that their clients would lose their
anonymity by signing a confidentiality waiver, the 9/11 USG has
established a database of September 11 services for its service
coordinators, and a number of their member organizations are creating
and using a confidential client information database. The Survivors‘
Fund and United Way of the National Capital Area have also created a
client database, which is primarily being used by these two agencies. A
common application form would improve the aid delivery process by
reducing the amount of documentation and forms clients have to provide
to each agency. The common application form is in progress in New York.
The form has not been established yet, as charities that have trained
volunteers nationwide indicated that at this time, they are not
interested in retraining all their volunteers to a new application.
Lessons Learned
after September 11 Could Improve
Future Responses but Pose Implementation Challenges:
Charities, government agencies, watchdog groups, and survivors‘
organizations shared with us lessons that could improve the charitable
aid process in disasters in the future. These lessons include easing
access to aid, enhancing coordination among charities and between
charities and FEMA, increasing attention to public education, and
planning for future events. Some efforts are under way to address these
issues. However, the independence of charitable organizations, while
one of their key strengths, will make implementation of these lessons
learned dependent on close collaboration and agreement among these
independent organizations.
Lessons Learned Could Prove Valuable in the Future:
Charities, government agencies, watchdog groups, and survivors‘
organizations shared with us the lessons they learned from the
September 11 charitable aid process that could be incorporated into the
nation‘s strategies for responding to large-scale disasters in the
future.
Easing access to aid for those eligible--Helping individuals in need
find out what assistance is available, and easing their access to that
assistance could be facilitated if a central, accessible source of
public and private assistance is made available to survivors. Access to
assistance could be further facilitated if charities adopted a
simplified, one-stop application process and a standard waiver of
confidentiality that would allow survivors to get access to multiple
charities and allow charities to share information on individuals
served and avoid duplicative services. While the focus of such an
effort would be to facilitate services to those in need, a one-step
application process could include a set of basic interview questions or
steps designed to prevent fraud. Another way to facilitate eligible
survivors receiving assistance is by offering each survivor a case
manager, as was done in NYC and in Washington. Case managers can help
to identify gaps in service and provide assistance over the long term.
Enhancing coordination among charities and between charities and FEMA-
-Private and public agencies could better assist those in need of aid
by coordinating, collaborating, sharing information with each other,
and understanding each other‘s roles and responsibilities. This
requires effective working relationships with frequent contacts.
Collaborative working relationships are essential building blocks of
strategies that ease access to aid, such as a streamlined application
process or the establishment of a database of families of those killed
and injured to help charities identify service gaps and further
collaboration.
Increasing attention to public education--Charities‘ increased
attention to public education could better inform the donor public on
how their money will be spent and the role of charities in disasters.
Controversies over donor intent could be minimized if charities took
steps when collecting funds to more clearly specify the purposes of the
funds raised, the different categories of people they plan to assist,
the services they plan to provide, and how long that assistance will be
provided, as that information becomes known.
Charities can further ensure accountability by more fully informing the
public about how their contributions are being used and providing
comprehensive information on facets of their operation to the public.
The September 11th Fund‘s and the Robin Hood Foundation‘s Web sites,
for example, list updated information on grants, recipients, amounts,
and purposes. Moreover, efforts such as those of the Metro New York
Better Business Bureau to compile information across multiple
organizations can help provide accountability for how funds are used.
For future events, the Ford Foundation report on the philanthropic
response to September 11 suggested that ’the major philanthropies
should consider designating a well-respected public figure who would
provide daily media briefings on their responses.“:
Planning for future events--Planning for the role of charities in
future disasters could aid the recovery process for individuals and
communities. While disasters, victims, and survivors can vary widely,
it could be useful for charities to develop an assistance plan to
inform the public and guide the charities‘ fundraising efforts. In
addition, state and local efforts related to emergency preparedness
could explicitly address the role of charities and charitable aid in
future events. Future plans could also address accountability issues,
including training for charitable aid workers and law enforcement
officials about identifying potential fraud and handling referrals for
investigations.
Some Charitable Organizations and FEMA Are Taking Steps to Incorporate
Lessons Learned but Face Significant Challenges:
While some of the lessons learned can be implemented at the individual
charity level, most require a more collaborative response among
charities, and some steps are under way to build collaborative
responses. Key efforts include the following:
* The National Voluntary Organizations Active in Disaster--This
organization has 34 national member organizations, such as the American
Red Cross, The Salvation Army, and Catholic Charities USA, 52 state and
territorial organizations, and some local organizations. Established in
1970, its goal is to promote collaboration, while encouraging agencies
to respond independently but cooperatively in disasters. Since
September 11, 2001, this organization has initiated information sharing
meetings in NYC and Washington, D.C., and has discussed lessons learned
at its annual meeting in March 2002. See appendix IV for a list of its
members.
* As part of its mission, the 9/11 United Services Group is planning to
develop a blueprint for the coordinated delivery of social services and
financial aid in future emergencies.
* Later this year, FEMA is facilitating a meeting between a committee
of the National Voluntary Organizations Active in Disaster and the
9/11 United Services Group.
While some charitable organizations are taking steps to incorporate
lessons learned, they face significant challenges. By its inherent
nature, the charitable sector is comprised of independent entities
responsive to clients and donors; it is not under the direction of a
unifying authority. While in situations such as September 11 FEMA is
required to coordinate activities of certain charitable organizations,
as well as others that agree to such an arrangement, FEMA officials
said that in exercising this authority for September 11 and other
events, they work closely with charities as a facilitator, not as a
leader or director. FEMA officials noted it is important to build and
maintain trust with the charitable organizations and to be careful to
give local leadership the opportunity to lead in disasters. An
externally imposed effort to direct or manage charities, whether by
FEMA or another entity, could have deleterious effects; a key strength
of charities is their ability to react flexibly and independently in
the event of disasters.
Conclusions:
Overall, charitable aid made a major contribution in the nation‘s
response to the September 11 attacks. Given the massive scale and
unprecedented nature of the attacks, the charities responded under very
difficult circumstances. Through the work of these charities, millions
of people have been able to contribute to the recovery effort and
provide assistance to those directly and indirectly affected by the
attacks. While much has been accomplished by charities in this
disaster, lessons or strategies have also been identified related to
improving access to aid, enhancing coordination among charities and
between charities and FEMA, increasing attention to public education,
and planning for future events that could improve future responses in
disasters.
There are no easy answers as to how to incorporate strategies that may
result in a more accessible and transparent service delivery system
into any future disasters. Coordination and collaboration among
charitable organizations are clearly essential elements of these
strategies, and some organizations have taken steps in this direction.
At this point in time, an appropriate role for the federal government
is to facilitate these efforts through FEMA, the federal agency that
already has relationships with many of the key organizations involved
in disaster response. This will help to ensure that lessons learned
from the September 11 attacks and their aftermath can be incorporated
into the nation‘s strategies for dealing with large-scale disasters
like this in the future. At the same time, it will help to ensure that
charities may remain independent and vital in their programs and
priorities.
Recommendation for Executive Action:
We are recommending that the director of FEMA convene a working group
of involved parties to take steps to implement strategies for future
disasters, building upon the lessons identified in this report and by
others to help create sustained efforts to address these issues. The
working group should address these and other issues as deemed relevant:
(1) the development and adoption of a common application form and
confidentiality agreement; (2) the establishment of databases for those
receiving aid in particular disasters; and (3) strategies for enhancing
public education regarding charitable giving in general and for large-
scale disasters in particular, including ways to enhance reporting on
funds collected and expended. This working group could include FEMA,
representatives of key charitable and voluntary organizations and
foundations; public and private philanthropic oversight groups and
agencies; and federal, state, and local emergency preparedness
officials.
Agency Comments:
In commenting on a draft of this report, FEMA said that the
recommendation is a practical one that is likely to foster enhanced
communication and coordination among charitable organizations,
foundation leaders, and government emergency managers. While FEMA
acknowledged the challenges of working with a number of independent
entities, it added that a working group of involved parties, along with
skillful leadership and active participation among members, is likely
to lead to important improvements in coordination and ultimately better
service to those affected by disasters. In addition, FEMA noted that a
component of the existing National Voluntary Organizations Active in
Disaster may serve as the basis upon which to build. FEMA‘s full
comments are presented in appendix VI.
We also shared a draft of the report with the American Red Cross, the
Salvation Army, The September 11th Fund, the 9/11 United Services
Group, an official of the National Voluntary Organizations Active in
Disaster, and officials in the New York State Attorney General‘s Office
in New York City and obtained their oral comments. They said the report
was fair and balanced and provided technical comments which we included
where appropriate. Regarding the recommendation, the American Red Cross
expressed some concern over whether FEMA was the right party to convene
the working group, stating that the group‘s goals would be outside of
FEMA‘s mission and that it would, therefore, be inappropriate to ask
that FEMA be responsible for ensuring the success of the work group.
The American Red Cross also said that the goals of the work group would
more properly fall under the purview of the nonprofit sector and that
work has already started on some of these areas.
In responding to this concern, we emphasize that our recommendation
charges FEMA with convening a working group of involved parties but
does not specify that FEMA play the leadership role or be charged with
management or oversight of the group‘s progress. We agree that the key
to the success of a working group in this area will depend on the
actions of the charitable and voluntary organizations involved. We also
acknowledge that some efforts are under way, including among the
American Red Cross, Salvation Army, and the United Way, to address some
of these issues. However, we continue to think that it is appropriate
for FEMA to play a role in initiating meetings that will bring together
involved parties. This will help to ensure that sustained attention is
paid to these important issues and potentially result in improving the
nation‘s response to those in need in any future disasters.
As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
after its issue date. At that time, we will send copies of the report
to other interested parties. We will also make copies available upon
request. In addition, the report will be available at no charge on
GAO‘s Web site at http://www.gao.gov.
If you or your staff has any questions about this report, please
contact me at (202) 512-7215 or Gale C. Harris, Assistant Director, at
(202) 512-7235. Kevin Kumanga and Emily Leventhal also made key
contributions to this report.
Sincerely yours,
Cynthia M. Fagnoni, Managing Director
Education, Workforce, and
Income Security Issues:
Signed by Cynthia M. Fagnoni
[End of section]
Appendix I: September 11th Victim Compensation Fund of 2001:
Who is eligible: Any individual who was physically injured or the
families and beneficiaries of any individual who was killed as a result
of the terrorist-related aircraft crashes of September 11, 2001.
Payments: The average award under the September 11th Victim
Compensation Fund of 2001--before the statutorily required collateral
offsets--is projected to be more than $1.8 million per claimant.
Although it is difficult to determine the amount of collateral sources
(e.g., life insurance) each claimant will have, the Special Master who
oversees the fund believes the average payout after collateral sources
will be approximately $1.5 million per claimant. Charitable aid
received by families is not taken into account in determining award
amounts.
Total estimated expenditures: Over $5 billion.
Applications: Filing deadline is December 2003.
[End of section]
Appendix II: September 11 Fund Data for 35 Large Charities:
Relief charities: American Lung Association[A]; Amount
raised: $139,000; Amount
distributed: $63,000; Percent
distributed: 45.
Relief charities: American Red Cross Liberty Fund; Amount
raised: 1,011,000,000; Amount
distributed: 696,000,000; Percent
distributed: 69.
Relief charities: Americares Foundation; Amount
raised: 9,261,073; Amount
distributed: 9,261,073; Percent
distributed: 100.
Relief charities: Army Emergency Relief[B]; Amount
raised: 5,792,588; Amount
distributed: 477,100; Percent
distributed: 8.
Relief charities: American Society for the Prevention of Cruelty to
Animals; Amount
raised: 1,744,000; Amount
distributed: 1,179,000; Percent
distributed: 68.
Relief charities: Catholic Charities of NY[C]; Amount
raised: 25,400,000; Amount
distributed: 17,300,000; Percent
distributed: 68.
Relief charities: Catholic Charities USA; Amount
raised: 31,847,514; Amount
distributed: 30,590,054; Percent
distributed: 96.
Relief charities: Citizens‘ Scholarship Foundation; Amount
raised: 113,167,336; Amount
distributed: 1,054,174; Percent
distributed: 1.
Relief charities: Farmers‘ Market Federation of NY[D]; Amount
raised: 162,000; Amount
distributed: 162,000; Percent
distributed: 100.
Relief charities: Federal Employee Education & Assistance Fund; Amount
raised: 5,500,000; Amount
distributed: 650,000; Percent
distributed: 12.
Relief charities: International Association of Fire Fighters; Amount
raised: 161,000,000; Amount
distributed: 159,898,000; Percent
distributed: 99.
Relief charities: Jewish Federation of Greater Washington[C]; Amount
raised: 450,000; Amount
distributed: 400,000; Percent
distributed: 89.
Relief charities: Kiwanis International Foundation; Amount
raised: 1,591,916; Amount
distributed: 1,558,373; Percent
distributed: 98.
Relief charities: Lions Clubs International Foundation; Amount
raised: 3,023,000; Amount
distributed: 1,200,000; Percent
distributed: 40.
Relief charities: National Italian American Foundation; Amount
raised: 334,000; Amount
distributed: 71,500; Percent
distributed: 21.
Relief charities: Navy-Marine Corps Relief Society; Amount
raised: 6,800,000; Amount
distributed: 67,300; Percent
distributed: 1.
Relief charities: New York Police and Fire Widows‘ and Children‘s
Benefit Fund; Amount
raised: 117,000,000; Amount
distributed: 53,000,000; Percent
distributed: 45.
Relief charities: New York Times 9/11 Neediest Fund; Amount
raised: 61,147,017; Amount
distributed: 60,583,789; Percent
distributed: 99.
Relief charities: NYC Police Foundation; Amount
raised: 11,000,000; Amount
distributed: 6,400,000; Percent
distributed: 58.
Relief charities: New York State Fraternal Order of Police Foundation;
Amount
raised: 12,028,314; Amount
distributed: 7,200,972; Percent
distributed: 60.
Relief charities: New York State World Trade Center Relief Fund[E];
Amount
raised: 68,730,000; Amount
distributed: 60,355,500; Percent
distributed: 88.
Relief charities: Port Authority Police Benevolent Association[C];
Amount
raised: 11,642,025; Amount
distributed: 9,988,001; Percent
distributed: 86.
Relief charities: Robin Hood Foundation; Amount
raised: 60,300,000; Amount
distributed: 38,500,000; Percent
distributed: 64.
Relief charities: Rotary International; Amount
raised: 1,800,000; Amount
distributed: 1,450,000; Percent
distributed: 81.
Relief charities: Salvation Army[C]; Amount
raised: 87,722,612; Amount
distributed: 64,629,024; Percent
distributed: 74.
Relief charities: The September 11th Fund; Amount
raised: 512,000,000; Amount
distributed: 376,000,000; Percent
distributed: 73.
Relief charities: Survivors Fund[B]; Amount
raised: 20,000,000; Amount
distributed: 4,300,000; Percent
distributed: 22.
Relief charities: Tides Foundation; Amount
raised: 597,207; Amount
distributed: 594,934; Percent
distributed: 99.
Relief charities: Twin Towers Fund; Amount
raised: 205,000,000; Amount
distributed: 156,000,000; Percent
distributed: 76.
Relief charities: Uniformed Firefighters Association[C]; Amount
raised: 71,000,000; Amount
distributed: 60,000,000; Percent
distributed: 85.
Relief charities: Union Community Fund; Amount
raised: 3,092,105; Amount
distributed: 2,938,000; Percent
distributed: 95.
Relief charities: United Jewish Communities; Amount
raised: 4,800,000; Amount
distributed: 4,400,000; Percent
distributed: 92.
Relief charities: United Way National Capital; Amount
raised: 3,956,512; Amount
distributed: 3,034,461; Percent
distributed: 77.
Relief charities: Windows of Hope; Amount
raised: 19,000,000; Amount
distributed: 8,000,000; Percent
distributed: 42.
Relief charities: World Vision; Amount
raised: 12,428,378; Amount
distributed: 11,908,215; Percent
distributed: 96.
Relief charities: Total; Amount
raised: $2,660,456,597; Amount
distributed: $1,849,194,470; Percent
distributed: 70.
Source: Data provided by charities, as of October 31, 2002, does not
include distributions planned for the future.
Notes: We asked the charities to exclude funds they had received from
other September 11 funds to avoid overstatement of the funds involved.
In addition, the amount of funds distributed includes funds used for
administrative purposes in some cases. Because of differences in how
charities defined and reported administrative funds, we did not break
out administrative funds.
All information as of October 31, 2002, unless noted in one of the
table notes.
[A] As of June 25, 2002.
[B] As of September 30, 2002.
[C] As of July 31, 2002.
[D] Fund closed September 11, 2002.
[E] This is not a charity; the New York State Department of Taxation
and Finance established and administers this fund of donations.
[End of table]
[End of section]
Appendix III: Contact Information for State Charity Officials:
State: Alabama; Charity office: Attorney General‘s Office; Main
telephone
number: [Empty]; In-state toll
free number: 800-392-5658.
State: Alaska; Charity office: Attorney General‘s Office; Main
telephone
number: 907-465-2133; In-state toll
free number: [Empty].
State: Arizona; Charity office: Attorney General‘s Office; Main
telephone
number: 602-542-5763; In-state toll
free number: 800-352-8431.
State: Arkansas; Charity office: Attorney General‘s Office; Main
telephone
number: 501-682-2341; In-state toll
free number: 800-482-8982.
State: California; Charity office: Attorney General‘s Office; Main
telephone
number: 916-322-3360; In-state toll
free number: 800-952-5225.
State: Colorado; Charity office: Attorney General‘s Office; Main
telephone
number: 303-866-5189; In-state toll
free number: 800-222-4444.
State: Connecticut; Charity office: Attorney General‘s Office; Main
telephone
number: 860-808-5318; In-state toll
free number: [Empty].
State: Delaware; Charity office: Attorney General‘s Office; Main
telephone
number: 302 -577-8600; In-state toll
free number: [Empty].
State: District of Columbia; Charity office: Department of Consumer and
Regulatory Affairs; Main telephone
number: 202-442-4400; In-state toll
free number: [Empty].
State: Florida; Charity office: Department of Agriculture and Consumer
Services; Main telephone
number: 850-488-2221; In-state toll
free number: 800-435-7352.
State: Georgia; Charity office: Secretary of State; Main telephone
number: 404-656-2817; In-state toll
free number: [Empty].
State: Hawaii; Charity office: Attorney General‘s Office; Main
telephone
number: 808-586-2727; In-state toll
free number: [Empty].
State: Idaho; Charity office: Attorney General‘s Office; Main telephone
number: 208-334-2424; In-state toll
free number: 800-432-3545.
State: Illinois; Charity office: Attorney General‘s Office; Main
telephone
number: 312-814-2595; In-state toll
free number: [Empty].
State: Indiana; Charity office: Attorney General‘s Office; Main
telephone
number: 317-232-6330; In-state toll
free number: 800-382-5516.
State: Iowa; Charity office: Attorney General‘s Office; Main telephone
number: 515-281-5926; In-state toll
free number: [Empty].
State: Kansas; Charity office: Attorney General‘s Office; Main
telephone
number: 785-296-2215; In-state toll
free number: 800-432-2310.
State: Kentucky; Charity office: Attorney General‘s Office; Main
telephone
number: 502-696-5389; In-state toll
free number: [Empty].
State: Lousiana; Charity office: Attorney General‘s Office; Main
telephone
number: 504-342-7013; In-state toll
free number: [Empty].
State: Maine; Charity office: Attorney General‘s Office; Main telephone
number: 207-626-8800; In-state toll
free number: [Empty].
State: Maryland; Charity office: Secretary of State; Main telephone
number: 410-974-5534; In-state toll
free number: 800-825-4510.
State: Massachusetts; Charity office: Attorney General‘s Office; Main
telephone
number: 617-727-2200; In-state toll
free number: [Empty].
State: Michigan; Charity office: Attorney General‘s Office; Main
telephone
number: 517-373-1152; In-state toll
free number: [Empty].
State: Minnesota; Charity office: Attorney General‘s Office; Main
telephone
number: 651-296-3353; In-state toll
free number: 800-657-3787.
State: Mississippi; Charity office: Secretary of State; Main telephone
number: [Empty]; In-state toll
free number: 888-236-6167.
State: Missouri; Charity office: Attorney General‘s Office; Main
telephone
number: 573-751-3321; In-state toll
free number: [Empty].
State: Montana; Charity office: Attorney General‘s Office; Main
telephone
number: 406-444-2026; In-state toll
free number: [Empty].
State: Nebraska; Charity office: Attorney General‘s Office; Main
telephone
number: 402-471-2682; In-state toll
free number: [Empty].
State: Nevada; Charity office: Attorney General‘s Office; Main
telephone
number: 702-486-3777; In-state toll
free number: 800-992-0900.
State: New Hampshire; Charity office: Attorney General‘s Office; Main
telephone
number: 603-271-3591; In-state toll
free number: [Empty].
State: New Jersey; Charity office: Department of Law; Main telephone
number: 973-504-6215; In-state toll
free number: [Empty].
State: New Mexico; Charity office: Attorney General‘s Office; Main
telephone
number: 505-827-6060; In-state toll
free number: 800-300-2020.
State: New York; Charity office: Attorney General‘s Office; Main
telephone
number: 212-416-8000; In-state toll
free number: [Empty].
State: North Carolina; Charity office: Secretary of State; Main
telephone
number: 919-807-2214; In-state toll
free number: [Empty].
State: North Dakota; Charity office: Attorney General‘s Office; Main
telephone
number: 701-328-3404; In-state toll
free number: 800-472-2600.
State: Ohio; Charity office: Attorney General‘s Office; Main telephone
number: 614-466-4320; In-state toll
free number: [Empty].
State: Oklahoma; Charity office: Secretary of State; Main telephone
number: 405-521-3912; In-state toll
free number: [Empty].
State: Oregon; Charity office: Attorney General‘s Office; Main
telephone
number: 503-229-5725; In-state toll
free number: [Empty].
State: Pennsylvania; Charity office: Department of State; Main
telephone
number: 717-783-1720; In-state toll
free number: 800-732-0999.
State: Rhode Island; Charity office: Attorney General‘s Office; Main
telephone
number: 401-222-3048; In-state toll
free number: [Empty].
State: South Carolina; Charity office: Secretary of State; Main
telephone
number: 803-734-1790; In-state toll
free number: 888 -242-7484.
State: South Dakota; Charity office: Attorney General‘s Office; Main
telephone
number: 605-773-4400; In-state toll
free number: 800-300-1986.
State: Tennessee; Charity office: Secretary of State; Main telephone
number: 615-741-2555; In-state toll
free number: [Empty].
State: Texas; Charity office: Attorney General‘s Office; Main telephone
number: 512-463-2070; In-state toll
free number: 800-621-0508.
State: Utah; Charity office: Department of Commerce; Main telephone
number: 801-530-6601; In-state toll
free number: [Empty].
State: Vermont; Charity office: Attorney General‘s Office; Main
telephone
number: 802-828 3171; In-state toll
free number: [Empty].
State: Virginia; Charity office: Department of Agriculture and Consumer
Services; Main telephone
number: 804-786-2042; In-state toll
free number: 800-552-9963.
State: Washington; Charity office: Secretary of State; Main telephone
number: 360-753-0863; In-state toll
free number: 800-332-4483.
State: West Virginia; Charity office: Secretary of State; Main
telephone
number: 304-558-6000; In-state toll
free number: [Empty].
State: Wisconsin; Charity office: Attorney General‘s Office; Main
telephone
number: 608-266-1221; In-state toll
free number: [Empty].
State: Wyoming; Charity office: Attorney General‘s Office; Main
telephone
number: 307-777-7841; In-state toll
free number: [Empty].
Source: National Association of State Charity Officials Web page:
http://www.nasconet.org.
Note: The offices listed in this table may be contacted if you have
questions or information related to charitable aid.
[End of table]
[End of section]
Appendix IV: Members of National Voluntary Organizations Active in
Disaster:
The National Voluntary Organizations Active in Disaster has 34 national
member organizations as well as 52 state and territorial Voluntary
Organizations Active in Disaster.
American Baptist Men‘s Ministries
Adventist Community Services
American Radio Relay League
American Red Cross
America‘s Second Harvest
Ananda Marga Universal Relief Team
Catholic Charities USA
Christian Disaster Response
Christian Reformed World Relief Committee
Church of the Brethren
Church World Service
Episcopal Relief and Development
Friends Disaster Service
Humane Society of the United States
International Relief Friendship Foundation
International Aid
Lutheran Disaster Response
Mennonite Disaster Service
National Emergency Response Team
National Organization for Victim Assistance
Nazarene Disaster Response
Northwest Medical Teams International
The Phoenix Society For Burn Survivors
Points of Light Foundation
Presbyterian Disaster Assistance
REACT International
The Salvation Army
Society of St. Vincent de Paul
Southern Baptist Disaster Relief
United Jewish Communities
United Methodist Committee On Relief
United States Service Command
Volunteers of America
World Vision:
[End of section]
Appendix V: Organizations Participating in 9/11 United Services Group
Service Coordination:
American Red Cross in Greater New York:
Asian American Federation of New York:
Chinese-American Planning Council:
Chinatown YMCA:
Filipino American Human Services:
New York Asian Women‘s Center:
Japanese American Social Services:
Asociacion Tepeyac:
Black Agency Executives:
Community Service Society of New York:
Brooklyn Bureau of Community Service:
Catholic Charities of the Archdiocese of New York:
Catholic Charities of Brooklyn and Queens:
Center for Independence of the Disabled in New York:
Federation of Protestant Welfare Agencies:
Lutheran Social Services of Metropolitan New York:
Hispanic Federation:
Committee for Hispanic Children and Families:
Puerto Rican Family Institute:
Unitas Therapeutic Community:
Urban Health Plan:
Human Services Council:
Children‘s Aid Society:
Latin American Workers Project:
The Legal Aid Society of New York:
Mental Health Association of New York City:
Safe Horizon:
The Salvation Army:
United Jewish Appeal - Federation of Jewish Philanthropies of New York:
F.E.G.S. NY:
F.E.G.S. Long Island:
Jewish Board of Family and Children‘s Services:
Westchester Jewish Community Services:
Shorefront Y:
United Neighborhood Houses of New York:
Forest Hills Community House:
Supportive Children‘s Advocacy Network New York:
WTC Permanency Project:
Council on Adoptable Children:
Jewish Child Care Association:
[End of section]
Appendix VI Comments from the Federal Emergency Management Agency:
Federal Emergency Management Agency Washington, D.C. 20472:
DEC 02 2002:
Ms. Gale Harris:
Assistant Director. Education, Workforce, And Income Security Issues:
United States General Accounting Office Washington, DC 20548:
Dear Ms. Harris:
The enclosure contains The Federal Emergency Management Agency‘s
response to the GAO Draft Report entitled: ’September 11 --More
Effective Collaboration Could Enhance Charitable Organizations‘
Contributions in Disaster.“:
If you have the need for any further information, please have a member
of your staff contact Larry Zensinger, Director, Recovery Division at
(202) 646-3642.
Sincerely,
Gary E. Crowell:
Chairman, Audit Coordinating Committee:
Signed by Gary E. Crowell
Enclosure:
cc: Inspector General:
Federal Emergency Management Agency Washington, D.C. 20472:
NOV 21, 2002:
MEMORANDUM FOR: Nancy L. Hendricks Assistant Inspector General
for Audit:
FROM:
John R. D‘Araujo, Jr. Assistant Director Response and Recovery
Directorate:
SUBJECT:General Accounting Office (GAO) Draft Report:
We have reviewed the GAO Draft Report entitled: ’ September 11 --More
Effective Collaboration Could Enhance Charitable Organizations‘
Contributions in Disaster“ and would like to submit the following
comment, as invited by GAO to do so:
The recommendation as stated on page 27 is a practical one that is
likely to foster important interagency communications and an enhanced
level of coordination and collaboration among charitable organizations,
foundation leaders, and government emergency managers. Though some
discussion of lessons-learned has certainly begun already, such a broad
based working group does not currently exist. As indicated in the GAO
report there are very real challenges when working with a number of
independent agencies, however, with skillful leadership and active
participation among members, this working group is likely to lead to
important improvements in coordination and ultimately better service to
those affected by disasters. The already existing National VOAD
Recovery Committee may serve as the basis upon which to build.
Please contact Larry Zensinger, Director, Recovery Division at (202)
646-3642 if you have any questions on this matter.
FOOTNOTES
[1] See U.S. General Accounting Office, Review of Studies of the
Economic Impact of the September 11, 2001, Terrorist Attacks on the
World Trade Center, GAO-02-700R (Washington, D.C.: May 29, 2002).
[2] The 2001 Emergency Supplemental Appropriations Act for Recovery
from and Response to Terrorist Attacks on the United States, P.L. 107-
38, mandates that not less than one-half of the $40 million
appropriated shall be for disaster recovery activities and assistance
activities in New York, Virginia, and Pennsylvania.
[3] See U.S. General Accounting Office, September 11: Interim Report on
the Response of Charities, GAO-02-1037 (Washington, D.C.: Sept. 3,
2002).
[4] IRS evaluates compliance by reviewing the informational Form 990,
Return of Organization Exempt from Income Tax.
[5] Businesses, as well as individuals, may also access federal aid,
for example, Small Business Administration loans.
[6] The Department of Justice‘s Public Safety Officers Benefit Fund
provides a one-time sum of $250,000 to the next-of-kin of a fallen
public safety officer, such as a firefighter. This amount was
retroactively adjusted after September 11, as the 2001 amount had been
$152,000.
[7] State Crime Victim Compensation Board Funds are available post-
disaster if, like the September 11 attacks or the Oklahoma City
bombing, the disaster site is also a crime scene.
[8] IRS told us that in December 2002, it would begin a ’limited
operational review“ of 88 of the newly approved charities. This review
will examine whether the money raised by these charities was expended
for charitable purposes, whether these charities met their IRS filing
requirements, and whether or not the charitable funds raised provided
personal or private benefit to the charity or individuals involved.
[9] For more information see U.S. General Accounting Office, Tax-Exempt
Organizations: Improvements Possible in Public, IRS, and State
Oversight of Charities, GAO-02-526 (Washington, D.C.: Apr. 30, 2002).
[10] See A Study of the Ongoing Needs of People Affected by the World
Trade Center Disaster prepared by McKinsey & Co. for 9/11 United
Services Group (New York, NY: June 2002). The 9/11 United Services
group is a consortium of 13 organizations formed in December 2001 to
foster a more coordinated approach to aid delivery. This survey
conducted for them is based on data collected in April and May 2002.
The figure cited does not include any additional cash assistance
families may receive from the September 11TH Victim Compensation Fund.
[11] Seessel, Tom, The Philanthropic Response to 9/11. Prepared by The
John S. Watson Institute for Public Policy, Thomas Edison State College
for the Ford Foundation (Trenton, N.J.: Aug. 2002).
[12] The Victims of Terrorism Tax Relief Act of 2001, P.L. 107-134, was
enacted January 23, 2002. Among other provisions, the act states that
tax-exempt charities making payments ’by reason of the death, injury,
wounding, or illness of an individual incurred as the result of the
terrorist attacks against the United States on September 11, 2001, or
an attack involving anthrax occurring on or after September 11, 2001
and before January 1, 2002,“ are not required to make specific
assessment of need before giving out aid. The act also forgives for
certain tax years the tax liability of those killed in the April 19,
1995, Oklahoma City bombing, those killed in the September 11, 2001,
terrorist attacks, and those killed in the terrorist attacks involving
anthrax occurring after September 10, 2001, and before January 1, 2002.
[13] A recent study conducted by McKinsey & Co. for the 9/11 United
Services Group estimates that the cost of meeting the needs of all
those affected by September 11 in NYC will be $373 million in 2003 and
$44 million in 2004. See A Study of the Ongoing Needs of People
Affected by the World Trade Center Disaster prepared by McKinsey & Co.
for 9/11 United Services Group (New York, NY: June 2002).
[14] These organizations include the Better Business Bureau‘s Wise
Giving Alliance, the American Institute of Philanthropy, the Urban
Institute‘s Center on Nonprofits and Philanthropy, the National
Committee for Responsive Philanthropy, the Brookings Institution, and
the Ford Foundation.
[15] Martha Ross, Brookings Greater Washington Research Program and
Sandra Padilla, Diane Levy, and Elizabeth Cove, The Urban Institute,
Calling 211: Enhancing the Washington Region‘s Safety Net After 9/11
(Washington, D.C.: Sept. 2002).
[16] 2002 Supplemental Appropriations Act for Further Recovery From and
Response to Terrorist Attacks on the United States, P.L. 107-206,
enacted August 2, 2002.
[17] We spoke with state charity officials, from state attorneys
general offices or secretary of state offices, in seven states:
California, Maryland, Massachusetts, New Jersey, New York,
Pennsylvania, and Virginia.
[18] As of October 31, 2002.
[19] Although the cases mentioned here all involve the successful
receipt of money from charities, not everyone who was charged with
fraud received aid.
[20] Family Assistance Centers were primarily designed to meet the
needs of the families of those killed. These centers were set up by key
government entities at each attack site, specifically, the city of New
York and the Department of Defense Office of Family Policy.
Pennsylvania did not have a Family Assistance Center, but Pennsylvania
September 11th Assistance coordinated services for families of victims
of the Pennsylvania crash. Disaster Assistance Service Centers were set
up by FEMA in New York to serve the needs of those recently displaced
from their jobs as a result of the September 11 attacks.
[21] By July 2002, USG reported training 300 coordinators, 90 percent
of which are from USG charities.
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