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Report urges changes to federal charity program


The Combined Federal Campaign, which funnels federal employee donations to charities, would have fewer middlemen and be a different looking animal if recommendations of a study panel are followed.

The CFC was 50 years old in 2011, when Office of Personnel Management Director John Berry formed the CFC-50 Commission. Its mission: Make recommendations to strengthen “the integrity, the operation and effectiveness” of the campaign. During its half-century, federal employees have donated more than $7 billion to charitable organizations.

Joe Davidson writes the Federal Diary, a column about federal government and workplace issues that celebrated its 80th birthday in November 2012. Davidson previously was an assistant city editor at The Washington Post and a Washington and foreign correspondent with The Wall Street Journal, where he covered federal agencies and political campaigns. View Archive

Recent trends, however, haven’t been good. The economy might have had something to do with pledges dropping to $272.7 million in 2011, after peaking at $282.6 million in 2009. Last year, less than 24 percent of the federal workforce participated, and the average pledge is $284.

The 24 recommendations in the report, released Friday, “range from opening the CFC to additional communities of potential donors to achieving greater efficiencies by taking better advantage of new technologies,” the commission co-chairs, Tom Davis, a former Republican congressman from Virginia, and Beverly Byron, a former Democratic congresswoman from Maryland, said in a letter transmitting the report to OPM.

Berry praised the work of the commission. In a statement, he said, “we have already taken administrative actions in a number of areas addressed by the Commission. The Administration supports the direction of the recommendations and will consider regulatory changes as appropriate.”

Some recommendations could have a significant, and perhaps controversial, effect on the CFC’s structure. For example, the commission wants to shift “the burden of CFC costs from donors to participating charities.”

“Commission members believe many potential donors are opposed to giving to the CFC because administrative expenses are deducted from the funds being sent to charities,” the report said.

Under the commission’s recommendations, a charity would get 100 percent of its donations, but it would be charged a participation fee to cover administrative expenses.

The commission acknowledges that if a flat fee was adopted, fewer charities might seek inclusion in the CFC. That could result in some donors choosing not to give.

There are alternatives to a flat fee, including pegging the size of the fee to the amount of money the charity expects to receive.

Byron said in an interview that the intent of the recommendation was that more money would go to the actual work of the charities.

Another recommendation, to “consolidate PCFO [Principal Combined Fund Organizations] back office functions” into regional centers or a national office, would reduce the number of CFC middlemen. PCFOs administer local campaigns.

“The Commission notes, with concern, the cost of the CFC is driven up significantly by having numerous PCFOs engaged in similar back-office functions like processing receipt and distribution of contributions,” the report said.

Global Impact, the combined fund organization for employees in the Washington area and overseas, has a different view.

“A streamlined infrastructure would appear desirable, at least on the surface,” Renee S. Acosta, president of Global Impact, said in a letter to the commission. But she said centralization could “limit the flexibility to tailor the campaign to local and regional needs and desires.”

In the course of presenting its recommendations, the commission pointed to a number of issues that could negatively affect the CFC’s performance.

For example, the gap between the number of federal employees who are asked to contribute and those who do is growing “wider and wider,” according to the report. Currently, only active employees may donate. The commission recommends that retirees and others be allowed to participate.

The commission also recommended that the CFC get better acquainted with the digital world.

“Paper has been and continues to be a major aspect of CFC operations, driving up costs to charities and CFC administrators alike,” the report said.

Paper dependency also can turn off some potential donors, said Steve Delfin, president and chief executive of America’s Charities, a coalition of organizations that participate in the CFC.

“Despite federal paperwork reduction acts and electronic signature requirements, CFC rules still require paper-based, hard-copy signatures on most pledge forms and all applications from more than 20,000 charities,” Delfin said in testimony to the commission. “Most federal employees still do not have basic access to electronic means to support charities — something that is commonplace in the private sector.”

This, he added, “may partially account for the lower participation rates because younger employees live and breathe in the digital world.”

Previous columns by Joe Davidson are available at Follow him on Twitter: @JoeDavidsonWP.

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