Dear Sir,
This letter is in response to the report by David Goldstein that he did on vehicle donation programs, which aired Tuesday Wednesday, May 9th and 10th. I am the Executive Director of The Youth Rescue Fund of LA Youth Supportive Services. We owe our existence to the good fortune of having a vehicle donation program administered by the O.N.N.E. Corp. My purpose for writing is not to extol the virtues of the O.N.N.E. Corp., which are many and include their taking us on at a time when they didn't want or need any more business, because they knew we desperately needed the support. I am writing because your report, by only presenting part of the story, did unjustified harm to the reputation of a truly humanitarian corporation and even worse put this vital source of revenue to the organizations it supports in jeopardy by undermining public confidence.

There are two problems with your reporting. The first is that you compare the gross revenues to the amount of monies the agencies receive. This type of analysis will always make the fundraising appear as a rip-off of the contributors’ good intentions and a short changing of what the organizations should have received. This is because the cost of promoting the fundraising has been left out of the equation. It is the agencies percentage of the NET profits, not the gross, which is important. 

The second problem with your analysis is that you are treating vehicle donation programs as if they were fund raising ventures where money was donated to an event, like a walk-a-thon or a concert, rather than as a recycling or remanufacturing operation, which they truly are.  In the case of vehicle donation programs, what is being donated are vehicle that, as they sit in the donees’ driveways have little monetary value.  That is usually why they are being donated for a tax write-off, rather than being sold by the owner. Much has to be done before these otherwise unsellable vehicles can be turned into cash.

Expensive, paid television and radio advertising is needed to generate the donations. All the donated vehicles then need to be towed. Over half of the vehicles that are processed by the O.N.N.E. Corp. are not fit for resale and are sold to the junkyards, at very little profit. Of the other half, most need to be worked on before they are fit to be sold. There is, finally, the administrative and operating costs of running such an extensive recycling operation.  All of these expenses are left out of an analysis that compares the gross proceeds to what the agencies receive. When you accurately reported that, on the average, the agencies get about 15% of the gross, you led the viewers to erroneously assume that the remaining 85% goes into the pockets of the owners of the O.N.N.E. Corp. The truth is that when you look at the NET profits, after the above-mentioned costs of taking an unsellable car in the donee’s driveway and turning it into cash, the agencies receive 98% of the revenues.  This compares quite favorably with the accepted guidelines for money raising events, such as concerts, where 65% of the money collected going to the benefiting organization is considered quite acceptable.

I would also like to respond to the comments of Mr. Craig Thompson of Aids Project LA who said that they signed on to a new company that is giving them 35% of the gross. What he didn’t say is that that company does not do any advertising for its charities and it does not accept any cars older than 1986 and all cars have to be in running order and ready to sell. Their only expense is for a tow truck and the car lot. They can certainly afford to give APLA 35% and still make a killing. Even with advertising, (which accounts for over 45% of the ONNE Corp’s expenses) less than 20% of the cars donated to APLA in their last year with the ONNE Corp were of this high quality. I wonder how, without paying for advertising, APLA is planning to get people to donate enough of these classy cars for them to raise at least the $300,000 that the ONNE Corp. generated for them last year.  I am looking forward to your follow up interview with them a year from now.

I think it is unconscionable for you to malign The O.N.N.E. Corp. and its principals in the way you did. If there ever was a group of people who deserve to do well by doing good, it is they. Unfortunately, in 1999, because of huge increases in the costs of running the business, they almost did not even make enough for their own modest salaries. My organization’s experience with them has been wonderful. When we first looked into the possibility of associating with them, their absolute honesty and meticulous paperwork impressed even the highly skeptical high-ranking law enforcement people on our Board of Directors. From the beginning, they have committed themselves to cover most of our bare minimum expenses. There have been many months where we have gotten a check that has been thousands more than we actually earned as our percentage of the car sales. We owe our existence to these angels.

Your report has done real damage to the number of vehicles donated this month. This has a direct effect on the organizations’ income. Even worse, because The O.N.N.E. Corp. has a very high fixed operating expense this unexpected lack of donated vehicles puts the entire operation and our agencies welfare in jeopardy. I hope you will do whatever it take to right this egregious wrong and restore our donee’s confidence.

Sincerely,