No Progress Report: Bergen Record Raised Serious Questions in January 2008 About Donating Your Car to the "Outreach Center," to "Heritage for the Blind," and to "Kars4Kids"

Is this what Orthodox Judaism tolerates, allows, assists and advocates? Apparently, yes. And we don't like it one bit.

The January 2008 story about donating your car to the "Outreach Center" is no longer found on the Bergen Record web site.

The organization is still out there. We saw a billboard on Rockaway Turnpike (Queens) on Sunday advertising the "charity."

The article, "Are donated autos helping needy kids?" published some grisly details.

The story raised a number of issues about the Orthodox Jewish run "Outreach Center," its ads, programs, and rabbinic management.

Here is the 2008 text:
The cherubic face peers from billboards across the region; along the New Jersey Turnpike, in downtown Hackensack, from the back of NJ Transit buses, even in the restrooms at Shea Stadium.

Donate Your Car. Help Children in Need. Call the Outreach Center.

But if you visit the Brooklyn address that's listed as home to the organization, you won't find many children at all.

Instead, you'll find Kehilas Mevakshai Hashem, a storefront Orthodox synagogue headed by Rabbi Yehuda Levin -- the arch-conservative religious leader who stirred up controversy in Jerusalem last year by organizing opposition to a gay pride march there and promising, "There's going to be bloodshed -- not just on that day, but for months afterward."

Principals of the Outreach Center did not respond to repeated requests for an interview. And a spokesman declined to answer questions about whether the money goes into a bank account used by Levin or his synagogue, but acknowledged that the charity's finances are "intertwined" with the congregation's.

The spokesman, Fady Sahhar, whose Philadelphia public-relations firm represents the group, said the Outreach Center has a budget of roughly $1.6 million a year, from selling off as many as 3,500 donated vehicles a month from across the country.

It serves chiefly as a middleman, using a portion of the proceeds from the sales to write checks to mainstream charities.

The Outreach Center declares itself to be a religious organization, and therefore isn't required to file tax returns that secular charities must make publicly available.

While some religious non-profits file the forms voluntarily, the Outreach Center doesn't. Those forms provide details on how much an organization spends on its charitable work, whom it funds, what if anything it pays its officers, or how much it spends on overhead and fund raising.

Several of the charities it says it supports haven't received any payments since 2002, and have raised objections to the Outreach Center's use of their names.

The organization spends significantly on advertising, with numerous billboards in prime locations along major highways, which can each cost $10,000 a month or more. It pays thousands more to an affiliated tow truck company -- Outreach Towing in Staten Island. And in the past six years it has loaned $475,000 to real-estate developers, public documents show.

Sahhar said he couldn't provide an audited financial statement for the Outreach Center.

"The finances of the center are so intertwined with those of the synagogue, I can't give you that," Sahhar said.

In fact, the Outreach Center owns the building where its offices and the synagogue are located, which it obtained from the center's president, Brooklyn lawyer Harold Schwartz, in 1999. The deed of purchase doesn't list a purchase price.

"It's still affiliated with the synagogue," Sahhar said of the Outreach Center. "But we're in the process of creating further separation. We're looking at how to make it totally transparent."

The rabbi who leads the congregation on Avenue K at Nostrand Avenue has been involved in a number of public controversies.

In 1997 Levin was the lead plaintiff in an unsuccessful lawsuit brought by 16 Orthodox rabbis trying to block the opening of the Museum of Jewish Heritage -- A Living Memorial to the Holocaust in Manhattan, over its inclusion of information about homosexual Holocaust victims.

Last November he went to Atlanta, where he led prayers to end the drought that has plagued the South, proclaiming that the last time he performed this ritual, in 1986, four days of rain of followed. On Dec. 10, speaking on behalf of the Orthodox Rabbinical Alliance of America, he urged President Bush to cancel his recent visit to Israel to protest "the disarming of hundreds of thousands" of Israeli settlers in the West Bank.

In 1996, Levin was honorary co-chairman of Pat Buchanan's 1996 presidential campaign.

Others concerned

Who benefits from the Outreach Center's work?

Sahhar said overhead costs -- including advertising, towing, insurance and other fees -- come to between $500,000 and $600,000 annually. He added that the organization spends less than 10 percent of its budget on "administration, something it takes great pride in."

He also maintained the Outreach Center donated "close to $1 million" to charity last year out of its total $1.6 million budget.

According to the center's Web site (outreachcenter.com), it gave about $100,000 to the United Way of New York City in 2006 and 2007 and $110,000 to Scholarship America, a non-profit in Edina, Minn., that distributes college scholarships.

Scholarship America, however, says it doesn't get any donations from the Outreach Center, but does manage a scholarship program in which the center selects the recipients.

The Web site lists no donations from 2003 through 2005 and just $45,000 to a range of charities from 1999 through 2002.

If you call its car-donation phone line, an operator tells you the money raised from selling your vehicle goes to four non-profits: the United Way, Scholarship America, Jacobi Medical Center in the Bronx and the Hope and Heroes Children's Cancer Fund at Columbia University Medical Center in Manhattan. Spokesmen for the hospitals said the Outreach Center gave each of them $10,000 last year.

All of which falls far short of $1 million total, let alone $1 million in one year.

"We don't list every donation we make on the Web site," Sahhar said. "Some organizations may not allow us to use their name."

Based on Sahhar's figures, about 60 percent of the Outreach Center's money goes to charity, which would be about in line with the recommendations of experts in the car-donation field, according to Bob Small, president of V-DAC, an Ohio company that handles car donations for many charities.

"Once you start getting below 50 percent, you have to look very closely at the program," he noted.

Congress and state regulators have looked into the car-donation industry in recent years, but government oversight remains minimal. In 2004, Congress limited how much of a tax deduction donors can take, but didn't address the activities of the car-donation charities themselves. Both federal and state laws make it difficult to take action against them unless regulators can prove fraud.

Scholarships, mortgages

Several of the charities listed on the center's Web site say they never gave permission for the use of their names.

Spokesmen for the March of Dimes and Helen Keller Services for the Blind in Brooklyn said they would be contacting the center to demand it remove the organizations from its Web site. A spokesman for Boys Town, the Nebraska charity that takes care of neglected and abused children, pointed out that the organization already has an arrangement with a different group -- the California-based Cars4Causes -- that handles its car donations.

Scholarship America and the United Way also expressed concern with the way their names are being used. The Outreach Center doesn't actually donate money to Scholarship America, according to officials with the Minnesota organization.

"We manage a scholarship program for them," said the group's Cathleen Park. "The Outreach Center does the selection of who gets the scholarships and we administer the payment process."

When asked who received the Outreach Center scholarships and what schools they attended, Sahhar responded with a written statement from the center outlining its general policy on granting scholarships -- but offering no specifics about recipients.

A senior United Way official said that agency is concerned about whether the Outreach Center is providing enough information to the public about its operation.

"We're in the process of figuring out what our relationship with them should be," said Matthew Shapiro, senior director for business development at the United Way. "Part of the discussion we're having with them is, Are we providing sufficient disclosure to the public about the relationship we have with them?"

Government records cast some light on where some Outreach Center money goes.

In 2003, the center loaned $225,000 to Brooklyn developer Mendel Brach, his partner Moshe Roth and their real estate partnership, Quality Estates, to purchase property in Monticello, N.Y.

The loan was to be paid off by July 2004, but the center ended up having to sue Brach and Roth for the payments, winning a final judgment in August 2006.

In 2002 and 2003, the center issued $250,000 in two mortgages to W.B.D. Construction in Brooklyn for construction of an apartment building. The mortgage documents state that the loans were to be paid off at the end of three months, but they still haven't been repaid, according to records available in December in the New York City Register's Office.

Sahhar didn't respond to questions about the mortgages.

While some non-profits have used loans as a way to earn more interest than they could by investing their money in bank accounts or government and corporate bonds, many experts on non-profit finances frown on the practice, saying it's too risky and diverts funds that could be spent instead on a charity's mission.

Investing in mortgages is problematic because it's outside most charity officials' area of expertise, said Diana Aviv, president of Independent Sector in Washington, the nation's leading trade association for non-profit groups.

"Non-profits are not in the bank business," said Aviv, who has testified before Congress on legislation limiting the kinds of loans non-profits can make. "They don't have the ability to do the kinds of checks that a bank can do," she added.

Billboards, bus signs

Perhaps the biggest chunk of the center's funds goes to pay for advertising. Last year it paid NJ Transit $10,000 to place ads on buses and in train stations for three months. It also paid for ads in the bathrooms at Shea Stadium during last year's baseball season.

Most of its advertising, however, appears on roadside billboards. In recent weeks, at least four were seen along the New Jersey Turnpike, one at the Meadowlands Sports Complex, one on Route 80 in Lodi, two at the Route 46 traffic circle in Little Ferry, and others along Route 46 in Ridgefield Park and Clifton, in downtown Hackensack, Fair Lawn -- even as far away as Sparta in Sussex County. Others are placed at strategic locations in metropolitan New York, including along the Major Deegan Expressway in the Bronx and on the Gowanus Parkway approach to the Battery Tunnel in Brooklyn.

The companies that own the billboards declined to say how much they were paid for the ads, and the center didn't answer questions about them.

But advertising brokers said the monthly charge for a large sign along the turnpike and other interstates would cost anywhere from $4,500 to well above $10,000 a month, depending upon its location. Normal rates for signs on smaller roadways and in urban neighborhoods run from $100 to $1,500 a month.

A spokeswoman for CBS Billboards said the company offers a discount to non-profit groups, but declined to say how much of a price reduction CBS gives them. Nonetheless, industry sources estimated that the dozens of billboard ads the Outreach Center buys would cost the organization $100,000 or more a month.

Sahhar insisted that the center's money is well-spent. "When you look at the number of people who have been helped, that's what this is all about," he said. "The big story is all the children that benefit."

A related story on 1/20/08 in the Bergen Record (also no longer on the site) raises questions about two other Orthodox Jewish run charities - "Heritage for the Blind" and "Kars4Kids."

We believe that we have to press these Orthodox organizations to become models of proper fund-raising and charitable giving rather than models of how close to the borderline of illegality one can get.

Here is the story - which we applaud.
Looking for donated autos is big business in New Jersey

Billboards for the Outreach Center may be ubiquitous, but it's hardly the only car-donation charity with an extensive local advertising campaign.

The radio airwaves in recent weeks were filled with ads seeking vehicle donations to organizations that help the blind, children in need or the poor generally.

One of them -- Heritage for the Blind -- is located on Nostrand Avenue in Brooklyn, just four blocks from the Avenue K building the Outreach Center shares with an Orthodox synagogue.

Heritage for the Blind claims on its Web site to use its car-donation money to pay for the publication of Braille and large-print materials.

"Each year, thousands of these texts are distributed free of charge to blind and visually impaired individuals and various organizations in the United States as well as overseas," the Web site states.

It also spends very little of the money it raises on those programs. According to its 2005 federal tax return (the most recent available), Heritage for the Blind raised $2.4 million that year, and spent nearly $3.3 million -- eating into its reserves.

But just $495,133 of that spending went for its programs. It spent more than $2.7 million on fund raising and management expenses. At the same time, Heritage paid its director, Steven Toiv, and two employees with the same last name -- Shrage Toiv and Yehuda Toiv -- a total of $300,384.

Steven Toiv declined to answer questions about Heritage's operation, instead providing a statement blaming the organization's financial difficulties on federal tax-law changes that took effect in 2005, restricting individual deductions for car donations.

JOY for Our Youth is the organization behind the Kars4Kids radio jingle broadcast in commercials across the metropolitan region.

The Lakewood-based group took in more than $9 million in 2006, according to its most recent tax return, and gave $7.6 million to Oorah, another Lakewood charity formed in 1980, which describes its purpose on its Web site as "awakening Jewish children and their families to their heritage. We enable children to enroll in Jewish day schools or yeshivas, where they receive a full religious and secular education straight through high school."

But donors listening to the Kars4Kids radio ads or looking at its Web site would be hard-pressed to know the group has a religious purpose. The radio spots make no mention of it.

On its Web site, the group calls itself "an international organization providing for the physical, emotional and spiritual needs of distressed and at-risk youth."

A photo prominently displayed on the page until this month pictured a classroom with three children -- two of them black. Links to three Jewish charities are listed at the bottom of the home page, in very small type.

Mark J. Kurzmann, a lawyer in Pearl River, N.Y., who represents Oorah, said neither group makes any attempt to hide its purpose. The pictures on the Web site are "stock photos," he said, adding that JOY has decided to remove them to avoid any confusion.

"Let me point out, however, that there are African-American and Asian-American children who go to the summer camps they support," Kurzmann said.

No comments: