The 2018 Combined Federal Campaign (CFC) launched today with a new donation system officials hope will at least slow the precipitous decline in participation the past several years. The 2017 campaign started late and raised just $101 million compared to $167 million the previous year. It has declined every year since its peak of $283 million in 2009.
The new CFC Online Donation System is intended to increase transparency and help to ensure that contributions made by federal, postal and military personnel, as well as retirees, reach the intended organizations, according to the U.S. Office of Personnel Management (OPM). The enhancements include a central giving website for all potential CFC contributors that provides access to the pledge information and charity payments. Campaign workers will direct anyone choosing to make an online pledge to the CFC Online Donation System. The only exceptions are employees in the Intelligence Community and the Department of State. The CFC Online Donation System replaced multiple systems, including local access points.
The 2018 campaign runs through Jan. 11, 2019. There are three fees that organizations pay to participate in the campaign, an application fee, due and payable at the time a charity applies for participation in the CFC, and a listing fee, due and payable at when a charity is accepted by OPM to participate in the CFC. Distribution fees are also assessed against pledges received. The fee structure is based on tiers.
Those tiers refer to the size of the organization based on total revenue reported on the federal Form 990. Tier I is organizations that report $1 million or more in revenue. Tier II is those organizations that report $250,000 or more in revenue, but less than $1 million. Tier III is organizations that report less than $250,000 in revenue. Application fees vary from as much as $1,575 to as low as $20. Contributions are administered by the Central Campaign Administrator (CCA) and disbursed on a monthly basis starting April 1 immediately following the campaign period.
Prior to 2017, the overhead administrative costs of much of the CFC program were paid out of donor contributions through the campaign. Campaign costs nationwide historically have averaged 10 percent, according to the CFC, although it reportedly was approximately 25 percent last year after donations plunged nearly 40 percent. The rate reportedly was 15 percent in 2016 and roughly 14 percent for 2014 and 2015.
The fees were spent on campaign promotion, printed materials, employee training, and other administrative expenses. All local campaign costs are reviewed and approved by the Local Federal Coordinating Committee (LFCC) governing the local campaign, according to the OPM.
Charitable organizations pay for these expenses when they apply to participate in the CFC. A charitable organization must be recognized as a tax-exempt nonprofit organization under 26 U.S.C. 501(c)(3) of the Internal Revenue Code. An application to participate in the CFC must provide specific information about the organization’s accounting, governance, and program functions, as specified in the CFC regulations at 5 CFR §950. The organization must also provide a completed and signed copy of its Form 990 for the most recent fiscal year.
Organizations must demonstrate that they provide services in the service area to which they are applying, national/international, international or local. Charities may apply to participate in the CFC individually (as an unaffiliated, or “independent,” organization) or must be represented by a federation. A federation is defined by OPM as a coalition of individual charities that align to minimize administrative costs and to coordinate activities. The CFC has raised more than $8.2 billion for charitable organizations since its inception in 1957, according to OPM.
