OPINION:
Today, millions of Americans will honor the victims of the Sept. 11, 2001, terrorist attacks. Many will make charitable donations to pay homage.
Much of that money will be wasted. At the World Trade Center complex, the National September 11 Memorial & Museum will be one likely recipient. Averaging 9,000 visitors daily, the 9/11 Memorial Museum’s revenue exceeds $93 million, driven largely by donations, tours and admission fees. The museum charges up to $500 to sponsor cobblestones and $2,500 for paver stones with a message. The amount you spend determines stone placement in the 8-acre complex.
Yet the museum still bleeds money. Last year, expenses hit $112 million, resulting in a nearly $20 million deficit. Part of the problem is payroll. Working in finance isn’t the only lucrative career at World Trade. The New York Post recently detailed the museum’s payroll jumping from $22 million in 2020 to $34 million last year, with 13 employees earning six figures.
Leading the way is President and CEO Elizabeth Hillman, who received more than $856,000 in total compensation. Executive Vice President Joshua Cherwin hauled in more than $486,000. Then there is Chief Financial Officer David Sheehan, whose pay increased by nearly 300% from 2019 to 2024. Last year, Mr. Sheehan pocketed almost $433,000. Apparently, CFOs no longer need to balance the books.
If museum staffers are the winners, the victims’ families are losing out. They and other prospective museum donors should reconsider their support. The 9/11 Memorial Museum is just one name on a long list of charities that waste donor dollars. Financial mismanagement is especially pronounced in the veterans nonprofit space, where bad charities collect billions of dollars annually.
In too many cases, well-intentioned donors give their hard-earned dollars to charitable causes, only for the money to never fund well-run programs. On the one hand, charities often deploy deceptively altruistic-sounding names to trick donors. In 2021, the Federal Trade Commission stopped a massive telefunding operation that placed more than 1.3 billion deceptive fundraising calls claiming to support veterans and other worthy recipients. Sham groups such as “Act of Valor,” “Saving Our Soldiers” and “Veterans of America” gladly cashed the checks. Before that, the groups “Wounded Warrior Foundation” and “Wounded Warrior Fund” exploited the “Wounded Warrior” name to bankroll drug use and gambling. None of the donations ever funded veterans programs.
On the other hand, there are legitimate charities that also waste money on excessive overhead. The Purple Heart Foundation spends nearly 80% of its budget on overhead. The Vietnam Veterans Memorial Fund isn’t much better, spending more than 54% on overhead. That didn’t stop President and CEO Christopher Knotts from earning nearly $250,000 last year.
For donors, the first step is to take any charity’s promises with a heavy pinch of salt. The second is to cross-reference those promises with charity ratings, which track financial performance and other metrics. Charity rating platforms such as Charity Navigator, Charities for Vets and CharityWatch provide insight into where to donate — or not. Caution: Even these organizations don’t always agree on financial integrity. Charity Navigator, for example, still rates the 9/11 Memorial Museum as a four-star charity, its highest score. Despite the museum’s sky-high executive salaries, it still scores 100% on “financial health.” Donors are duped.
Other charity ratings are more stringent. The RAM Veterans Foundation scorecards at CharitiesForVets.org make recommendations for 100 large charities based on four financial tests. If a charity fails even one, it can’t receive “highly recommended” status. There is no partial credit; you either got the A+ or you didn’t. CharityWatch is another example, wading through complex financial reporting to issue informative ratings.
For those honoring 9/11 victims, there are better places to look than the 9/11 Memorial Museum. One is the Tunnel to Towers Foundation, which helps Gold Star and fallen first responder families. The foundation spends more than 90% of its $272 million budget on actual programs, which is highly recommended by Charities for Vets. CharityWatch similarly scored the foundation as an A+ charity, noting its financial efficiency.
Today and leading up to Veterans Day, countless charities will solicit donors. It’s up to us to give wisely. We can do better than $500 cobblestones and $2,500 pavers for excessive executive salaries.
• Rick Berman is president of RBB Strategies and is on the board of the RAM Veterans Foundation.
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