BBB Wise Giving Report for
Farm Aid

BBB Wise Giving Report issued August 2009
BBB Wise Giving Report expires August 2011


Does not meet one or more standards
This charity does not meet one or more of the 20 standards for Charity Accountability. Find out more...


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Charity Contact Information

Name: Farm Aid
Address: 11 Ward Street, Suite 200
  Somerville, MA 02143
Phone: 800-327-6243
617-354-2922
Web Address: www.farmaid.org
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BBB Wise Giving Alliance Comments

Year, State Incorporated: 1985, Illinois
Affiliates: None
Stated Purpose: “to provide assistance to poor and needy families in rural farming communities.”

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Evaluation Conclusions

              

Farm Aid (FA) does not meet the following 6 Standards for Charity Accountability.

Standard 1: Oversight of Operations and Staff - Organizations shall have a board of directors that provides adequate oversight of the charity's operations and its staff. Indication of adequate oversight includes, but is not limited to, regularly scheduled appraisals of the CEO's performance, evidence of disbursement controls such as board approval of the budget, fund raising practices, establishment of a conflict of interest policy, and establishment of accounting procedures sufficient to safeguard charity finances.

  • FA does not meet this Standard because the board of directors does not review the performance of the chief executive officer (CEO) at least once every two years.  The organization also does meet this Standard because it does not have a board-approved budget and does not inform the board of directors about the financial arrangements made with an outside fund raising firm and/or consultant hired in the past year.

Standard 3: Frequency and Attendance of Board Meetings - An organization shall have a minimum of three evenly spaced meetings per year of the full governing body with a majority in attendance, with face-to-face participation. A conference call of the full board can substitute for one of the three meetings of the governing body. For all meetings, alternative modes of participation are acceptable for those with physical disabilities.

  • FA does not meet this Standard because the board of directors did not meet in 2008.

Standard 6: Board Policy on Effectiveness - Have a board policy of assessing, no less than every two years, the organization's performance and effectiveness and of determining future actions required to achieve its mission.

  • FA does not meet this Standard because the board of directors does not have a written policy stating that, at least every two years, an appraisal be done assessing the organization’s performance and effectiveness and determining future actions required to achieve its mission.

Standard 7: Board Approval of Written Report on Effectiveness - Submit to the organization's governing body, for its approval, a written report that outlines the results of the aforementioned performance and effectiveness assessment and recommendations for future actions.

  • FA does not meet this Standard because it has not conducted an effectiveness assessment and does not have one planned for the near future.

Standard 16: Annual Report - Have an annual report available to all, on request, that includes: (a) the organization's mission statement, (b) a summary of the past year's program service accomplishments, (c) a roster of the officers and members of the board of directors, (d) financial information that includes (i) total income in the past fiscal year, (ii) expenses in the same program, fund raising and administrative categories as in the financial statements, and (iii) ending net assets.

  • FA does not meet provision (d) of this Standard because its annual report does not identify the total amount spent for each of its major program activities, fund raising, and end of year net assets.

FA meets the remaining provisions of the Standard.

Standard 19: Cause Related Marketing - Clearly disclose how the charity benefits from the sale of products or services (i.e., cause-related marketing) that state or imply that a charity will benefit from a consumer sale or transaction. Such promotions should disclose, at the point of solicitation: (a) the actual or anticipated portion of the purchase price that will benefit the charity (e.g., 5 cents will be contributed to abc charity for every xyz company product sold), (b) the duration of the campaign (e.g., the month of October), (c) any maximum or guaranteed minimum contribution amount (e.g., up to a maximum of $200,000).

  • FA does not meet this Standard because, in the past year, the organization participated in promotions for the sale of food that indicated that the organization will benefit from these purchases. The promotions, however, did not specify the actual or anticipated amount of the purchase price that will benefit the organization.
Farm Aid (FA) meets the remaining 14 Standards for Charity Accountability.
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Programs

              

FA provides grants to farm and rural service organizations to help farmers transition to more sustainable production methods and to help farmers build local food and farm economies. Through its annual concert and year long campaigns, FA brings family farm issues to the national agenda. Through its toll free number and website, FA refers farmers to a network of farm organizations across the country. FA hosts national trainings of farm advocates to strengthen the network of credit counselors, farm attorneys, and credit mediators. FA works with and provides grants to local, regional and national organizations to promote fair farm policies and grassroots campaigns. FA also partners with organizations fighting industrial agriculture, while building opportunity for family farmers who produce food, fiber, and energy.

For the year ended December 31, 2007, FA's program expenses were:

  
Promoting food from family farms 583,097
Helping farmers thrive 362,782
Taking action to change the system 283,214
Growing the good food movement 223,220
Total Program Expenses: $1,452,313
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Governance

              

Chief Executive : Carolyn Mugar, Executive Director
Compensation*:
$35,234

Highest Paid Executive: Glenda Yoder, Associate Director
Compensation*: $76,237

Chair of the Board: Willie Nelson
Chair's Profession / Business Affiliation: Musician

Board Size: 11

Paid Staff Size: 11

*2007 compensation includes annual salary and, if applicable, benefit plans, expense accounts, and other allowances.
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Fund Raising

              

Method(s) Used:

Direct mail, special events, television, grant proposals, Internet appeals, cause-related marketing, and membership appeals.
Fund raising costs were 8% of related contributions. (Related contributions, which totaled $1,251,872, are donations received as a result of fund raising activities.)
FA incurred joint costs of $17,775 for informational materials and activities that included fund raising materials. Of those costs $12,455 was allocated to fund raising expenses and $5,320 was allocated to program expenses.
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Tax Status

              

This organization is tax-exempt under section 501(c)(3) of the Internal Revenue Code. It is eligible to receive contributions deductible as charitable donations for federal income tax purposes.
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Financial

              

The following information is based on FA's audited financial statements for the year ended December 31, 2007.

Source of Funds  
Concert and special events (net) 810,683
Contributions 419,702
Royalties 95,307
Interest and dividends 43,177
Net unrealized and realized gains on short term investments 13,781
Donated materials and Services 13,313
Merchandise 8,174
Licensing fees 7,967
Net unrealized and realized losses on long term investments -7,507
Total Income $1,404,597


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Uses of Funds as a % of Total Expenses

Programs: 85%  Fund Raising: 6%  Administrative: 9% 

Total income   $1,404,597
  Program expenses $1,452,313
  Fund raising expenses 97,529
  Administrative expenses 149,721
 
Total expenses   $1,699,563
Expenses in Excess of Income   (294,966)
Beginning net assets   1,296,541
Ending net assets   1,001,575
Total liabilities   244,261
Total assets   $1,245,836

Note: FA reports receiving in-kind donations in the amount of $33,611. Included in this amount is $14,132 (website design), $7,500 (merchandise), $6,404 (legal), $2,500 (catering), $1,500 (radios) $1,000 (accounting) and $575 (computer maintenance).

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An organization may change its practices at any time without notice. A copy of this report has been shared with the organization prior to publication. It is not intended to recommend or deprecate, and is furnished solely to assist you in exercising your own judgment. If the report is about a charity and states the charity meets or does not meet the BBB Standards for Charity Accountability, it reflects the results of an evaluation of information and materials provided voluntarily by the charity. The name Better Business Bureau is a registered service mark of the Council of Better Business Bureaus, Inc.

This report is not to be used for fund raising or promotional purposes.

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