Biz Bulletin: What to know before entering charity run

Biz Bulletin: What to know before entering charity run

July 25th, 2014 By Jim Winsett in Business Diary

Jim Winsett

Photo by Contributed Photo/Times Free Press.

Q: I signed up to do a charity 5K race with some friends, and it turns out that at the last minute it was canceled! Is there anything I can do to get my money back?

A: Warm weather is here and thousands of runners and walkers all over Southeast Tennessee and Northwest Georgia lace up their sneakers every weekend to participate in charity 5Ks and other events. BBB reminds those who participate in organized runs or walks to make sure fundraising activities measure up to their expectations, and to do their homework if the race claims entry fees are supporting a charitable cause.

Many choose to run a race in memory of loved ones or because the cause is dear to them. But if supporting the cause is your motivation, it's important to dig deeper. BBB receives hundreds of complaints each year about community runs and walks, and knowing how entry fees or donations are used can be an important participation factor.

Complaints filed with BBB about 5K walk/run or other running events include entry fees not being refunded after events were canceled, learning donations were being used for unrelated causes or an extremely low contribution rate, people sending in race applications and fees only to find they were not on the race list, and organizers changing the location of the event without informing participants in advance. Many races and walks have entry fees, ranging from $5 to close to $100. Most of the time, a portion of that fee goes to cover security, medical personnel, T-shirts and other race related expenses, with the rest going to a designated charity. Some races support national charities, such as the Susan G. Komen Foundation, the American Cancer Society or the American Heart Association, while others support smaller, local charities such as animal shelters, schools and scholarship programs or environmental causes. Most races will list the charities it supports on its website. Some events, typically labeled as "novelty runs" such as Glow in the Park (www.glowintheparkrun.com/chattanooga2014) and Tap 'N Run (www.tapnrun.com) are organized by for-profit entities. Most for-profit races, will partner with a local charity, but it's important to check whether a portion of your registration fee includes a direct donation to the charity or not. Many times, race coordinators will offer an extra line at the bottom of the registration page to ask if you would like to donate money to the particular cause they are partnering with.

BBB's Charity Review program, reminds philanthropic consumers to check out the charity before making a commitment. BBB Charity Reviews available at bbb.org, are based on 20 Standards for Charity Accountability (www.bbb.org/us/standards-for-charity-accountability). BBB charity accountability standards evaluate governance and oversight, effectiveness, finances and fundraising, offering donors the confidence they need before they give. These standards also serve as great evaluation information for donors to know what to ask their charity of interest. BBB invites the public to make charity inquires at any time. BBB offers tips to guide you when participating in a walk, run or obstacle event for charity:

• Start With Trust. Check for legitimacy and background information of charities and businesses with BBB, the IRS, and your state's business licensing agencies.

• Be suspicious of vague appeals. How are funds going to be used exactly? What percentage of the money-raised will go to the specified charity if the event is owned or produced by a for-profit business? Additional information to assist donors can be found through BBB's Wise Giving Alliance (www.give.org).

• Do your research. You may read heartwarming stories of people who have been helped by the workings of the cause you wish to support, but make sure to look into the charity first. Make sure you have contact information in case a problem should arise, and follow up by putting the information in a search engine to independently confirm the information. It's upsetting to find later when trying to resolve a dispute that the address provided leads to an empty, open field.

• Ask Questions. Does the charity spend at least 65% of its total expenses on program activities, and does it spend no more than 35% of related contributions on fundraising?

• Pay by credit card. Paying with a credit card allows you to dispute the charges if a problem occurs. Resist the urge to pre-pay registration fees many months or even a year in advance, especially when the charity does not collect the fees. Most credit cards only have a 90-day window to report any discrepancies in your credit card statement, but verify with your credit card servicer.

• Read contracts and agreements. Make sure you read the "fine print" regarding cancellation policies, insurance and refunds and if any part of your entry fee is tax deductible. Also, be sure to make copies of everything regarding your registration.

Jim Winsett is president of the Better Business Bureau of Chattanooga.