May 31, 2001 | Read Time: 2 minutes
By JANET L. FIX
Giving USA‘s annual estimate of how much Americans contribute to charity is widely cited, but the report has long been criticized as an imprecise barometer of the state of philanthropy.
In an attempt to deal with some of the shortcomings, the editors of the annual philanthropy yearbook have made several changes in methodology.
Most of the changes were designed to deal with complaints that the estimate undercounts how much Americans give and where their donations go.
To improve the reliability of its estimates of where the charitable dollars went, Giving USA, a publication of the AAFRC Trust for Philanthropy, relied more on surveys of charities than previously. It tripled the number of surveys sent to charities asking for fund-raising data and received information from about 1,500 groups, 2.5 times the number of surveys used to calculate the 1999 estimates.
Changes also were made to improve the reliability of estimates of total giving, which previously had depended heavily on data from the Internal Revenue Service.
This year, researchers also considered statistics on personal income, wealth generated by the stock market, and other economic indicators and models.
Even so, researchers still were hobbled by out-of-date data.
The latest I.R.S. statistics available for projecting the 2000 figures were the charitable deductions that taxpayers listed on their 1998 income-tax returns. Because researchers must use two-year-old tax data, the estimates they made for 2000 will be revised once 1999 returns are available. When returns for the 2000 tax year become available, the 2000 estimates will be revised a final time.
Critics have been skeptical of that approach, noting that estimates in previous years have been revised by as much as 10 percent.
The other problem with the I.R.S. data, say researchers, is that they give only a partial picture of how much Americans contributed. Nearly three-quarters of all taxpayers don’t itemize their returns, so therefore don’t show the I.R.S. how much they gave to charity.
Even with the changes the yearbook editors made, the estimates still should not be considered definitive, say Giving USA editors.
“The estimates before were good, and they are better now,’’ said Patrick Rooney, director of research at the Center on Philanthropy at Indiana University, which is in charge of preparing Giving USA for the AAFRC Trust. “But they are still estimates. As we learn more and investigate other areas criticized in the past, the estimates will get even better.”
