In some cases, it is difficult to gauge a nonprofit’s true impact. The Roger Clemens Foundation records the sum of its charitable contributions on IRS filings based on the “fair market value” of tickets and memorabilia donated to charity auctions, instead of the prices at which the items sold.
When the the seven-time Cy Young Award-winning pitcher’s foundation gave an autographed Red Sox jersey to the Cystic Fibrosis Foundation in March 2011, for instance, Clemens’s nonprofit reported a charitable contribution of $2,000 — what his memorabilia partner, Tristar Productions Inc., considered to be the jersey’s fair market value — even though the sale yielded only $1,000 for the Cystic Fibrosis Foundation.
The accounting method is legal, according to nonprofit lawyers, and the foundation has disclosed price differences to the IRS. But the group’s reported donation total does not accurately represent the benefit its gifts have brought to their recipients. Between 2009 and 2011, the Roger Clemens Foundation claimed $83,308 in donations of tickets and memorabilia that sold for $75,423 — inflating their charitable value by 10 percent.
Even when players set out with noble goals, they frequently overestimate their drawing power and their managerial skills, nonprofit specialists say.
Barry Dym, executive director of the Institute for Nonprofit Management and Leadership at Boston University, said an athlete who feels a genuine call to philanthropy should consider establishing a nonprofit under the umbrella of one of the roughly 650 “community foundations” already operating in the United States. Community foundations help multiple nonprofits reduce their overhead costs by pooling resources.
Celtics point guard Rajon Rondo moved his nonprofit to the Bluegrass Community Foundation in Lexington, Ky., where it has thrived after a challenging first year on its own. The Rajon Rondo Foundation, which asks supporters to donate $5 for every assist the All-Star records during NBA games, raised a total of $209 in 2009 and spent all of the money on IRS filing fees.
“The first thing I did was stick a knife in the foundation and said, ‘We can’t afford this. This is silly,’ ” recalled Samuel K. Brown, a Kentucky accountant who became Rondo’s financial adviser after the nonprofit’s formation.
The collaboration with Bluegrass has helped Rondo support the Massachusetts Society for the Prevention of Cruelty to Children, where he has been an active volunteer in an after-school program since his rookie season.
“I remember his first visit, and he really just clicked with the kids,” said Mary McGeown, the organization’s president. “He has continued to play a role in their lives, taking them shopping or for pizza, always out of his own pocket.”
Other athletes also have shown an ability to improve the operations of their nonprofits. Swimmer Michael Phelps famously pledged to start a foundation with the $1 million bonus he received from Speedo after winning eight gold medals at the 2008 Summer Olympics in Beijing, but the first two years were like a false start for his nonprofit: $700,671 of revenue (Speedo pays the bonus over time) and just $22,000 to charity.
In the next two years, however, the Michael Phelps Foundation collected even more and gave away three quarters of the money raised, most of it to a swimming program at the Boys & Girls Clubs of America. In 2011, the foundation doubled the previous year’s revenue from a charity golf tournament while cutting expenses by a fifth.
“We learned a lot from the first tournament [in 2010],” said Mya Thompson, the foundation’s director of operations. “We looked at what our major expenses were and got sponsors to cover some of them, and had a much better year the second time.”
More often, athletes’ foundations continue to struggle, even as the players are celebrated for their perceived giving.
Boldin’s nonprofit raised $53,005 at its annual Q-Festival in 2010 — the foundation’s sixth year in existence — but spent $46,879 staging the three-day event, which included a golf tournament at the PGA National Resort & Spa in Palm Beach Gardens, Fla.
Though just 17 percent of the foundation’s proceeds went to charity that year, Boldin, who sponsors and supports a number of charitable activities in the Baltimore community, won the Ravens’ Walter Payton Man of the Year Award, an honor for good works he received again this past season. Neither Boldin’s agent nor a person listed as the Anquan Boldin Foundation’s principal contact responded to e-mailed questions or to requests to interview Boldin.Continued...