Deep Dive Chapter 2: Donation Options
There are many ways to be a part of NWH's mission. Foremost, of course, is engaging with your community to reach out to our neighbors in the streets. Another great way to be involved is to donate money to support our programs and operation. Fair warning: this blog post, being part of our "Deep Dive" series, is a bit dry and very detailed (this one's a doozy ;) ).
If you are just looking to make a quick donation, please do so here, thank you!
The central dogma of our programs is that our outreach be thoughtful. That goes not only for what we do for our homeless neighbors, but also for how we interact with you, our donors. One way we strive to honor our relationship with you is by providing you with as many options as possible so you can find the donation strategy that you are most satisfied with. This post is intended to go into all the nitty gritty for those of you who are looking for that kind of thing. The website is designed quite a bit simpler so that if you just want to donate real quick, you don't get turned off by the details.
First of all, it's important to understand that there are two different accounts that you can donate to. Each one is critical but you are free to make you choice based solely on your goals.
- Our Programs Account is 100% dedicated to programs. NWH does not and will not ever remove money from this account except to put it toward maintaining our food cards, purchasing kit supplies, or paying for redeemed haircut vouchers.
We even attempt to cover the PayPal fees with a transfer from our Operating Cost Account at the end of each year.
If you count the 6% discount on the food cards we get from Subway, and the fee coverage we try to provide, donations to this account are effectively more than 100% efficient at directly benefiting our homeless neighbors, and that is something we are very proud of.
- Our Operating Cost Account may be less flashy but it is just as important. These funds covers all the non-program expenses we incur throughout the year. A complete accounting of these charges is available on our operation details page but, in general, it includes things like the domain name, subscription to Airtable and Squarespace, business license and state filings, and a large chunk goes toward getting our taxes done each year.
We do not receive many donations directly to this account so we are getting more creative to fill the gap. Our games and events will often benefit this account, but we will always make that clear.
Our operating costs are relatively low and will not increase significantly over the years. This means that as we receive more donations into our Programs Account, the efficiency of our nonprofit as a whole (ratio of funds that go toward programs to funds that go toward operation) will start to increase very rapidly. In 2017 this ratio was 52%, but because we expect our operating costs to remain steady, if we bring in just another $1000 in donations to our programs that ratio increases to 60%. If we can bring in $10,000 in program donations each year then we are up to 80%. The BBB reports that nonprofits should have less than 35% of their funds going to operation which is 65% efficiency by the standards we are describing here.
...And we can totally get more than $10,000/year with your help :)
We are working on setting up a way for you to designate your donation to go 95% to our Card & Kit Account and 5% to our Operating Cost Account. As soon as that's up and running we'll update this post and reshare it :) It may take a while though, as working things out between PayPal and Squarespace is proving to be a bit of a challenge.
There are three ways for you to donate to Northwest Hospitality that result in 100% of your donation reaching us.
- Personal checks can be made out to Northwest Hospitality and mailed to PO Box 1152, Olalla, WA 98359
- PayPal's Giving Fund is set up to process donations without deducting any fees! Go to this link (https://www.paypal.com/fundraiser/charity/217275) to make your donation. Processing donations through this option can take several weeks but we will get your donation and you'll receive a confirmation email from us when it comes through.
- No transaction fees will be deducted from your donation. Northwest Hospitality will receive 100% of what you contribute.
- This is a particularly powerful tool if you wish to donate one larger sum once each year.
- Your donation will not reach Northwest Hospitality for 15-45 days as it has to first be processed by PayPal Giving Fund.
- This is not a good tool for directly ordering supplies because the funds take too long to reach NWH.
- There is no way to set up recurring donations through PayPal's Giving Fund.
- Cash donations can be made to our staff. You should receive a cash receipt and, if you provide your contact information, you will receive a confirmation email for each donation as well as a tax receipt at the start of the year. Tracking these contributions is a bit more challenging so we prefer the other two methods, but we are more than happy to accommodate you if this is your preference or circumstances make cash a convenience.
The main drawback for these first three methods, is that there is no way to set them up for automatic monthly payments which is an incredibly useful feature for us as we plan our budgets. Therefore, you can essentially look at PayPal's transaction fee as the cost you pay for the convenience of automatically sending donations monthly. That said, all the fees donors to our Card & Kit fund incurred in 2017 were offset with a transfer from our Operating Cost account and we hope to be able to do this every year.
- Donate directly through PayPal using our Donate buttons.
- NWH receives your donation immediately
- This is the only good way to set up a recurring (monthly) donation which is very helpful for our planning purposes.
NWH is able to establish a working Monthly Budget with recurring donations.
- This is how we manage direct kit supply donations because we receive the funds to purchase supplies immediately.
- Paypal deducts a fee equal to 2.2% + $0.30 from each transaction
5. On-the-fly contributions
Another way we are encouraging people to make one-time contributions, is by adding a link to our PayPal.me button to their phone's home screen.
If you find yourself too uncomfortable to approach a panhandler while you're out walking, take out your phone and donate what you would have given that person to us. We might not be able to directly help the person you saw, but 100% of your donation will go directly to food cards, hospitality kit supplies, and haircuts for our neighbors.
Our PayPal.me link is paypal.me/NWHospitality
There are many ways to quickly add a link to your homepage, if you need help figuring one out we'd be happy to suggest something, just get in touch!
If you have experience with Guidestar and want to support us through their platform, there are a few good reasons that we encourage our donors not to use the Guidestar service, despite the fact that we are silver rated by them in regards to our transparency. To start, the fees on Guidestar are significantly higher than the PayPal options listed above. And while it is possible to set up a recurring donation schedule on Guidestar, their system takes up to a month to process donations before forwarding them along to us for use in our programs. So while it is an option, we don't feel it is worth utilizing unless you really like Guidestar.
In any case, thank you very much for your patronage and being the most important part of building this caring community.