CFC charity groups obscuring overhead costs, report finds

Federations that provide administrative services to charities participating in the Combined Federal Campaign are not forthcoming about the fees they charge, making it difficult for CFC participants to determine how much of their donations go to overhead costs, according to a new report.

Formed as umbrella groups of organizations with similar missions, federations ease the logistics burden on charities seeking to qualify for the annual federal employee giving drive. Federations help charities submit applications to the Office of Personnel Management, which oversees the CFC, and create a single contact point to sort out the paperwork. They also increase the visibility of their member groups.

The federations charge fees for their services, but often are not up front about what those fees will be, according to the Workplace Giving Alliance, a consortium of federations working to promote efficiency in public sector workplace fundraising.

Charities can apply directly to OPM, or they can apply through a federation, which must have at least 15 eligible charities to qualify for the annual campaign. Forty-two federations, such as Aid for Africa and Jewish Charities of America, participated in CFC in 2012.

The report said federations should operate like businesses in a marketplace that are competing to recruit charities. The federations are missing a key market component, the report found, which is an open and transparent list of pricing options. Charities in the 2012 campaign often did not find out what federations charged until after they signed on.

The Workplace Giving Alliance determined the fee amounts charged by examining annual reports and tax forms. Federations typically collect donations for their member groups as they come in from federal employees, deduct their charges -- either a percentage of donations or a flat fee -- and give the remaining funds to the charity. This system makes it difficult for donors and charities to determine the cost of operations, the report said.

Federal Times, which first reported the findings, said OPM will soon issue draft regulations to overhaul the Combined Federal Campaign. One of the changes would prohibit federations from deducting their fees from donations and instead require them to bill charities directly.

The alliance commended the new policy, saying that requiring invoices will clarify what federations are charging charities for their services.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.


When you download a report, your information may be shared with the underwriters of that document.