Sen. Grassley drills down farther in Wounded Warrior Project probe
By DAVID BAUERLEIN | The Florida Times-Union, Jacksonville | Published: May 17, 2016
JACKSONVILLE, Fla. (Tribune News Service) — U.S. Sen. Charles Grassley kept the pressure on Wounded Warrior Project by sending a letter this week stating he has “serious questions” about the Jacksonville-based group’s often-repeated assertion that 80.6 percent of its funding goes to services for veterans.
“The trust WWP has engendered amongst the donating public requires it to be as transparent and open as possible with respect to its spending practices,” Grassley, R-Iowa, wrote in a letter sent Monday to Wounded Warrior Project Chairman Anthony Odierno.
Grassley, who is chairman of the Senate Judiciary Committee, has long taken an interest in investigating tax-exempt groups to determine how they are using their donations. The committee has been drilling down into Wounded Warrior’s finances since March and Grassley sent a fresh set of questions in this week’s letter.
Wounded Warrior Project said in a statement it will provide whatever information Grassley needs.
“We continue to maintain a productive dialogue with Sen. Grassley’s office and look forward to answering his request for a more detailed explanation of how our programs and services provide essential support to Wounded Warriors,” the statement said.
Figures for how much Wounded Warrior spends on veterans services have been all over the map, depending on whether they came from the group itself or organizations that evaluate charities.
Charity Navigator says 60 percent of Wounded Warrior’s spending goes to services. Charity Watch puts it at 54 percent. The Better Business Bureau’s Wise Giving Alliance put the figure at 80 percent, but the BBB is seeking more information in light of financial questions that have been raised in media reports.
Grassley challenged whether Wounded Warrior Project has spent as much money on veterans programs as it says it has.
He wrote in his letter that Wounded Warrior says it spent $242 million on veterans programs in the 2013-14 fiscal year, but “it appears that $150 million of it was not actually spent on veterans by WWP and a large portion of it was in-kind donations. This calls WWP’s claim that it spends 80.6 percent of its donations on veterans programming into question.”
Wounded Warrior has consistently stood by the 80.6 percent figure. In March, the organization issued a news release that summarized findings from a board-ordered review of the nonprofit’s finances. Wounded Warrior said the 80.6 percent figure comes directly from its most recent audited financial statement based on “established accounting principles” for how to allocate expenditures.
Grassley’s letter says he wants to determine whether $80.7 million worth of free media and advertising donated to Wounded Warrior in 2013-14 was used to inform veterans about program services, or if the purpose was to boost fund-raising.
He also requested examples of fund-raising solicitations that contained an education component. Wounded Warrior’s financial statement shows it spent $68.5 million on direct mail, online and television campaigns. Of that amount, $40.9 million was shown as program services, rather than fund-raising, because it had an educational component.
Grassley wants Wounded Warrior to “describe in detail the benefit conferred to veterans” to justify labeling such expenditures as program expenses.
He also is seeking information about spending from a Long-Term Support Trust Fund established by Wounded Warrior. Grassley wrote that Wounded Warrior transferred $9.1 million in fiscal 2013 and $28 million in fiscal 2014 into the trust fund. He said it appears Wounded Warrior is counting those transfers as program expenses on behalf of veterans. But in fiscal 2014, the only payment from the trust fund was $134,721 to Barclay’s for managing the trust, Grassley wrote.
“It would be helpful if WWP could describe, in detail, what benefit is provided to veterans by the Long-Term Trust,” Grassley wrote.
Grassley’s letter sheds more light on how Wounded Warrior arrived at a figure of $26 million for how much it spent on “conferences and events” in fiscal 2014.
Earlier this year, Wounded Warrior pushed back on media reports that suggested the $26 million was wasteful spending on employees by saying that 94 percent of that spending went to program services for veterans and their families.
Wounded Warrior provided documents to the Senate Judiciary Committee showing the charity hosted 3,246 events fiscal 2013 and 4,485 events in 2014. Grassley said the “vast majority” of those events involved veterans going to watch sports events such as MLB baseball, NBA basketball, and NHL hockey games.
He wants Wounded Warrior to explain how many of the sports events involved in-kind contributions such as donated tickets. He wants similar information on other “alumni programs” that Wounded Warrior sponsors for veterans to socialize with others.
Grassley also wants an explanation for what Wounded Warrior did to assist 1,500 veterans in obtaining Veterans Administration benefits.
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