Lutheran Services of America represents a large network of Lutheran social service and health organizations, with over 300 member nonprofits as part of its network. The organization is headquartered in Washington D.C., and reports a significant percentage of its revenue being dedicated directly to administrative expenses (e.g. salaries, etc.) as opposed to the charity program itself. The organization lacks some transparency concerning this unusual practice, which would be helpful for prospective or current supporters and increase the organization’s credibility significantly.
- No fundraising expenses
- Financial information is accessible to the public
- Awards and recognition
Over the last several years, income for Lutheran Services of America has fluctuated slightly. Some past years required that the organization access its emergency reserves to meet expenses:
- 2015: $2,449,016
- 2014: $1,920,808
- 2013: $2,326,495
- 2012: $2,125,238
- 2011: $2,450,136
Lutheran Services of America does not spend any of its revenue on fundraising events, which is highly unusual for nonprofit organizations.
Accessible Financial Information
Lutheran Services of America has published its annual reports from 2013–2015 and IRS Form 990s from 2005–2014. This information is comprehensive, and easily located on the organization’s website.
Those interested in following or receiving news about Lutheran Services of America can submit their email on the organization’s site and receive regular email newsletters. The organization also maintains active social media accounts with Facebook, Twitter, and LinkedIn. Individual partners may have additional or different channels of communicating with their donors.
Lutheran Services of America regularly recognizes individuals and groups which have been instrumental in delivering support to others and follows the mission of the organization: to love and serve others as the organization believes that God has commanded its members to do.
- Program percentage is low
- High salary for CEO
Program Percentage and Administrative Expenses
A measure of an organization’s program delivery is the percentage of its annual revenue used for its various programs. Most charity watchdog organizations state that a program delivery percentage of a minimum of 70 to 80 percent of an organization’s revenue being used for the charity’s program as a responsible measure of a charity’s fiscal management. Lutheran Services of America used only 43.6 percent of its annual income for its programs for the fiscal year ending June 30, 2015.
Past years show wildly fluctuating ratios of revenue to program delivery. Lutheran Services of America states that it employs over 1200 individuals, and the organization’s administrative expenses include salaries for many of these individuals. For the fiscal year ending on June 30, 2014, more of the organization’s revenue went to administrative expenses than to actual program delivery. The organization places nearly all of its salary and benefits under the umbrella of program services, which is unusual for organizations to do so.
Compared to other organizations the president and CEO of Lutheran Services of America, Charlotte Haberaecker, makes a modest salary. Of the large percentage of annual revenue which the organization spends on salaries, her annual salary for the fiscal year ending on June 30, 2015 was $202,422, as reported on the organization’s IRS Form 990 for the same time period. To put this number in perspective, however, the CEO’s salary is equivalent to about 8 percent of the revenue of the same year—disproportionately higher than CEO salaries of other charitable organizations.