Outdated fundraising strategies might end Military Order of the Purple Heart programs

July 10, 2018 - 12:50 pm

The Military Order of the Purple Heart might have to end some of its veteran support programs, and its sister entity, the Purple Heart Foundation, is likely to blame. 

According to Charity Watch, top-performing nonprofits spend 75 percent of their budget on actual programs and 25 percent on salaries and fundraising efforts. At the Purple Heart Foundation, these percentages are reversed — in recent years, the nonprofit has spent 75 percent of its budget on administrative expenses, and only 25 percent of the budget has made it to the Military Order of the Purple Heart and the veterans they support.

This is causing some serious problems for the Military Order of the Purple Heart. One of the MOPH’s key programs is the National Service Program. This program helps veterans file benefits claims to the Department of Veterans Affairs, and they’re good at it. In fiscal year 2017, the program earned $214 million in veterans benefits.

Unfortunately, funding for the National Service Program comes from the Purple Heart Foundation, the MOPH’s struggling sister entity. The MOPH stated in a press release that the Purple Heart Foundation is at fault for the suspension of this program.

The Purple Heart Foundation supports the MOPH through annual grants, but the value of those grants fluctuates unpredictably — in fiscal year 2015 it provided $8.7 million in funds and only $4 million in fiscal year 2016. According to annual tax filings, the Foundation’s available budget fell 40 percent between fiscal years 2016 and 2017.

Why such significant swings? Analysts at Charity Watch and leadership within the MOPH agree that the Foundation’s fundraising strategies are outdated, ineffective and expensive. The Foundation continues to hire fundraising professionals to coordinate events. These organizations not only come with costly contracts, but they also take a portion of funds raised.

For example, a 2017 household goods donation program raised $13.7 million, but $11.4 million of it went to GreenDrop, the professional organization that coordinated the program. This is just one of many examples of the Foundation’s fundraising failures.

According to a press release, the Purple Heart Foundation’s 2019 grant will keep the National Service Program afloat, but with far less financial resources and capabilities than in the past. The survival of this program and others like it at the MOPH depend on the Foundation’s ability to update their fundraising practices — a challenge Angelo Wider, the National Service Program director, is confident they can overcome.

“We’ve worked out some changes with the Foundation to increase efficiency so we’re going to hang in there,” said Wider. “We’re alive and well.”