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The Arc Vehicle Donation Program Review

Review Of Car Donation Services

4 Star Rating

The Arc Vehicle Donation

The Arc is the largest national community based organization that advocates for and serves people of all ages (and their families) who have an intellectual or developmental disability. A 501(c)(3) nonprofit organization, The Arc relies primarily on corporate and individual contributions to fund their long list of programs.

The Arc’s vehicle donation program is run by another nonprofit organization that provides job training and employment to people with disabilities, namely Melwood, which has been in operation since 1963. The Melwood Charity Car Donation Center handles your vehicle donation to The Arc, from the initial donor contact to the disbursement of the proceeds back to The Arc.

People First

The Arc consists of 700 state and local chapters, which actively work to protect the human rights of those with intellectual and developmental disabilities. Through programs, advocacy, and the dissemination of information, they work to ensure that people with disabilities are able and encouraged to be lifelong participants in their community.

The Arc’s programs and services center around job training, supported employment, transportation services, transition planning, and early intervention.

The Arc on Guidestar

It’s always a good idea to check out a charity before giving them any of your hard earned cash. Some charities mean well but have a dismal management record, while others may be outright fraudulent. You want to make sure your money will actually support the stated mission, and not pay for junkets to New Zealand for the board members.

The percentage of a charity’s expenses that go toward programming is a major, tell-all indicator of how efficient it is. The most efficient charities use 75 percent or more of their funding to support programs. The remaining expenses are divided between administrative costs and fundraising costs.

Guidestar is a great place find this information. A 501(c)(3) nonprofit organization itself, Guidestar believes that donors should be well informed about the charities they give to. As such, Guidestar compiles loads of information on every organization that’s registered as a 501(c)(3) nonprofit with the IRS. With a free account, you can look at a charity’s IRS Form 990, which details their revenue and expenses.

According to The Arc’s 2013 Form 990:

  • Total expenses in 2013 were $7,180,620.
  • $5,971,073, or 83 percent, went toward programming.
  • $731,546, or 10 percent, went toward administration costs.
  • $478,001, or 7 percent, went toward fundraising efforts.

The Arc is a highly efficient charity!

But What About the Intermediary?

Most charities use an intermediary organization to handle their vehicle donation programs, because most charities don’t have the manpower or the funds to handle it themselves.

Typically, the intermediary sells the car at auction. After the auction house takes its cut, the net proceeds go to the intermediary, which takes its share. In most cases, the intermediary’s share shouldn’t be more than 25 percent of the net proceeds.

Unfortunately, there are scores of unscrupulous intermediaries who may keep up to 90 percent of the net proceeds, effectively making lots of money off of the goodwill of people who donate their vehicle hoping to make a difference. At least, a bigger difference than 10 percent of the net proceeds.

So checking out a charity’s intermediary is just as essential as investigating the charity itself when it comes to car donations. In the case of The Arc’s Vehicle Donation Program, this means I went digging around in Melwood’s junk.

Melwood on Guidestar

Melwood is the intermediary for The Arc’s vehicle donation program. But just because it’s a 501(c)(3) doesn’t necessarily mean that it’s run by honest people. Some nonprofits appear to be using their nonprofit status as some kind of a front for seriously screwing awesome charities out of most of the proceeds of the vehicle’s sale.

But you’ll be happy to know that Melwood checks out. According to their 2013 Form 990, a staggering 89 percent of their expenses went directly to programs that year, with 8 percent going toward administration and just 3 percent invested in fund raising.

I wasn’t able to find out what percentage of the net proceeds that Melwood passes on to The Arc, but I’m sure two highly efficient and deeply respected charities can work that out fairly amongst themselves.

The Bottom Line for The Arc Vehicle Donation Program

It sounds like we have a marriage made in heaven here, one charity serving disabled people helping another charity serving disabled people, each helping the other further its mission.

So go forth and donate your vehicle in good conscience to The Arc, knowing that your donation will make a difference in the life of a person with a disability.

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