More than a third of the companies that have raised money in Washington state for charities this year gave less than half to the nonprofit groups that hired them.

Two of the companies actually spent more than they raised, which means none of the money donors gave actually reached the charities.

It was the first time in at least a decade that companies reported taking a loss on fundraising activities in an annual Secretary of State report on commercial fundraising.

Secretary of State Sam Reed's office compiles the report each year in the holiday season to urge consumers to give wisely.

Five of the 114 registered fundraisers passed on 80 percent or more of what they raised to charities, the report says.

Of the companies who passed on the smallest percentages, Virginia-based Richard Norman Co. said it was in the hole $245,000, or minus 13 percent, at the end of the fiscal year. It raised about $1.9 million through direct mail in Washington state for 11 nonprofit groups, including the Conservative Caucus and the Alliance for Marriage, the report says.

Owner Richard Norman, who raises money for political candidates and helped with Dan Quayle's brief presidential campaign in 1999 and Col. Oliver North's 1994 run for Senate, signed the paperwork sent to the state. But he disputed the state's characterization of his company as an ineffective fundraiser.

Before you give

Do your homework. State law requires solicitors to identify the company they're working for, the charity they're raising money for and the percentage of your contribution that will go to the charity. If they don't volunteer the information, ask for it. Here are some other tips:

Ask for printed material about the charity.

If you're solicited by a commercial fundraiser, contact the charity and make sure it has hired the company to raise money on its behalf.

Never give your credit-card number to a telephone solicitor. Pay by check and make it payable to the charity, not the fundraiser.

Don't be fooled by a sympathetic-sounding name or a name that closely resembles the name of a respected, well-established charity.

Don't let a solicitor rush you into a commitment. Legitimate charities should give you time to consider making a donation.

Be wary of charities that offer to send a courier to collect your money immediately.

Ask for identification if a solicitor comes to your door.

Check out a charity or commercial fundraiser on the Secretary of State's Web site, www.secstate.wa.gov/charities or by calling 800-332-GIVE.

Source: Washington Secretary of State's Office

Norman says his company raises money in several states and is successful on a national level.

"All of our clients make money or they would fire us," Norman said.

One of his clients, the Media Research Center in Alexandria, Va., said Norman passed on about $1.5 million to the center in the past year.

Of the companies that gave the highest percentages, Bellevue-based Coinstar topped the list, reporting it passed on 93 percent of what it raised for 18 charities.

On the other end of the spectrum, New York-based DialogueDirect was minus 328 percent in the hole. It spent $247,000 to raise $57,665 last year. Reed said that company took pledges from donors who are expected to make monthly contributions for the next five years. They expect to pass on $1.3 million to charities in that amount of time.

States can't legally require fundraisers to pass on a certain portion of money to the charities they work for. But state law requires solicitors identify the company they're working for and report the percentage of money passed to the charities.

The list included several repeat appearances from companies that have consistently passed on 10 to 15 percent of what they raise.

Unique Equity, which runs The Thrift Center in Kent, collected $615,380 and passed on $71,848 — or 12 percent — to United Cerebral Palsy of South Puget Sound. Company accountant Edward Mock said that reflects the cost of running a thrift store. The company has to pay postage for solicitations of merchandise, drivers to pick up merchandise and other overhead costs, he said.

Reed said he agrees with the Better Business Bureau guideline that at least 65 percent of the money a fundraiser brings in should be passed on to the charity. He urged consumers to be vigilant when they're solicited for money, even if they recognize the name of the charity.

Some of the fundraisers who passed on the smallest percentage were raising money for prominent and well-known veterans groups and police associations, among others, the report says.

DialAmerica Marketing passed on 13 percent of its proceeds to the charities it raised money for, including Mothers Against Drunk Driving and Special Olympics Washington, the report says. The company raises money by selling magazine subscriptions and told state officials that donors clearly understand how much of their money will be passed on.

A California company, Gordon and Schwenkmeyer, passed on $7,700 of the $347,899 it raised to NARAL Pro-choice America, United Farmworkers of America, and the National Coalition for the Homeless.

The company told the Secretary of State's Office it doesn't charge the nonprofit groups; it just pays for expenses out of the money it raises.

A NARAL spokesman couldn't comment last night on the California company except to say NARAL is "renowned" for its successful fundraising.

Emily Heffter: 206-464-8246 or eheffter@seattletimes.com

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