Charities in Houston Get Top Ranking

A group that tracks the financial practices of nonprofit organizations gives charities in Houston its highest rating in an analysis comparing a sample of charities in the nation’s 20 largest cities. Charities in Houston ranked first in fund-raising efficiency and third best in the percentage of their budgets spent on administrative expenses. The second-highest-rated city overall was Boston, while Miami ranked at the bottom of the list.

Charity Navigator, itself a nonprofit group that evaluates charity practices based on the information reported in the groups’ federal informational tax returns, looked at financial data for about 1,500 organizations in the 20 cities.

It analyzed the data based on a variety of performance measurements, including how much the charities spend on fund raising for every dollar they raise, what percentage of the groups’ overall spending goes for program services rather than overhead, and how the charities’ revenue has grown over time.

The analysis concludes that the financial behavior of large charities is influenced by their location. For example, charities in New York tend to have higher administrative costs, at least partially because of the high cost of living there, Charity Navigator found.

But New York charities did not spend the highest percentage of their total budgets on administrative costs, the analysis found. Their median spending on administration was 11 percent of their budgets. Among those that spent a greater share of their budgets on administrative costs were groups in Philadelphia (12.1 percent, on average), Atlanta (11.6 percent), Boston (11.6 percent), and San Francisco (11.2 percent).

The analysis is available free at the organization’s Web site, http://www.charitynavigator.org, or by contacting the group at 1200 MacArthur Boulevard, Second Floor, Mahwah, N.J. 07430; (201) 818-1288.