Charity Really Begins at Home

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BY ROLDO BARTIMOLE

Cleveland Free Times, August 12, 1998

Nothing reveals the tightfisted nature of Dick Jacobs more plainly than the fact that only 36 percent of the funds raised by events of the Cleveland Indians Charities, Inc. actually goes to charity.

Jacobs, owner of the baseball team and a bidder for the new Cleveland Browns franchise, uses the charity for self-promotion and also uses it to pay for the fund-raising events.

A charity gives the public the impression that the sponsor has a strong commitment to the community. It suggests that the sponsor has sensitivity for the needs of others. It gives the sustainer of the charity the perception of goodness and that it is valuable.

When the charity uses the funds for self-promotion, it becomes a cynical ruse. The people who participate mistakenly believe that their sharing greatly benefits some cause.

A clear case is the "luncheon series" given by Jacobs team. The charity's tax return shows that the luncheons bring in $43,580, a sum that might benefit some social need. The event is usually accompanied by celebrity speakers and garners media attention, and thus good will for the sponsor.

You can bet that Jacobs or the news media don't advertise what amount actually goes to help someone in need. The luncheons produced a measly $4,000 for charity from the $43,580. The rest, $39,580, is costs, written from the collection as "expenses."

A spokeswoman for the baseball team said that the luncheons were dropped in 1996 exactly because they drew so little in income for the charity.

Another example: Those participating in the Cleveland baseball charity's annual golf outing paid in $135,270. But expenses of $66,441 mightily trimmed what was available for charity, reducing it to $68,829.

Of course, the highly touted annual golf outing allows Jacobs' managers to hobnob with sports figures, celebrities, and business associates. Meanwhile, Jacobs basks in the sunshine of generosity, and it doesn't cost him an extra penny.

There are "costs inherent" in any charity, said the spokeswoman, who said that the Cleveland Indians charities' costs are "no higher than any other charity."

The tax return to the IRS states that the golf outing is an "annual event held to raise money on behalf of the youth of northeast Ohio." But the charity pays the expenses through the fund-raisers, while giving free publicity to Jacobs and his team.

In the last year available from the Ohio Attorney General's office, the charity had an income of $513,707. Not bad. (The return covers one year, ending October 1995. The charity is behind in its reporting to the attorney general, and a letter has been sent seeking more recent reports and assessing fines of several hundred dollars for late filings.)

Some charitable donations are made. The Cleveland public schools (which contribute a portion of property taxes to Jacobs' benefit at Gateway in the millions each year) get $100,000; followed by the Boys and Girls Clubs, $45,000; United Black Fund, $21,800; American Cancer Society, $5,000; and the Cleveland Baseball Federation, $4,800. (Wonder if the American Cancer Society contribution is meant to balance the $46 million cigarette smokers have contributed via the "sin" tax since 1990 in aid for Jacobs Field construction.)

If you total up the donations made by the charity in the year ending October 31, 1995 (the latest figures available), you get $187,650, far below the $513,000 collected. Some $278,000 is missing. Where did the money go?

Expenses.

How cheap can you get when you use charitable events to improve your reputation and then dump off all the costs to the charity?

The next highest revenue producer for the baseball charity comes from the tours of Jacobs Field. This charity revenue-producer brought in $73,188. But the charity writes off $41,683 as expenses. That leaves less than half, $31,505, for good deeds.

Jacobs, who recently took in some $60 million in stock sales for the Cleveland baseball team, actually has the nerve to charge off $2,500 in "administrative" charges to the charity. What gall!

Here's a guy who pays himself $750,000 a year from the Cleveland baseball team revenues and he can't restrain himself from picking up pennies in business expenses from a charity. He could write the whole thing off from his petty cash.

Here's a guy who had taxpayers build his $180 million stadium including a $7.2 million executive office building with $900,000 in furnishings chiseling $2,500 in administrative fees from a charity that essentially promotes him and his business.

Here's a guy without shame, but so symbolic of our "gimmie" corporate leaders all take and little give.

What makes the figures even more disturbing is that $55,000 of the total donations to the charity came from three firms. Stop-N-Shop gave $25,000; Society/Key Bank gave $15,000 and MTD Products, Inc., $15,000 all connected in co-promotions with the baseball team.

You will notice that the Cleveland baseball team, bolstered by sellout attendance figures, made no donation itself to its charity. Obviously, it depends upon others to feed its charity. (The telephone messages one hears when on hold at Jacobs headquarters brags that Cleveland Indians Charities gave $2 million in recent years, while also proclaiming that the team holds a baseball record for season sellout crowds.)

You will notice that not a penny is donated by Dick Jacobs, one of the wealthiest men in Cleveland and in the nation.

For Dick Jacobs there is no charity. There is only business.

Roldo Bartimole publishes the newsletter Point of View. He can be reached at pointofview@stratos.net

Copyright © 1998, Cleveland Free Times (Hummingbird Press)

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