Charlotte Mayoral Candidate Scott Stone Fails Competency Test

A charity fund run by Scott Stone, Republican candidate for mayor in Charlotte, is receiving some unwanted attention for the low percentage of fundraising dollars passing through to the supported cause. According to available tax returns, North Carolina Heroes Fund (NCHF) has raised $168,807.73 and distributed $39,210.37 to veterans in need. This means only 23% of funds raised has passed through to help veterans, not the 30% stated by the Charlotte Observer. In contrast, $41,542.48 has gone to one professional fundraiser in 2009 and well over $40,000 in unitemized expenses have been incurred. This leaves Scott Stone's financial competence wide open for criticism.

NCHF has a very honorable stated goal of helping the state's veterans with emergency funds and tuition assistance. The web site lists a number of veterans who have been helped by the fund in different ways. Some grants might seem small, but anyone who has ever experienced financial difficulties knows that trouble sometimes starts with one bill that can't be paid. The Fund also lists some very important people as members of their advisory board and a wide variety of community leaders are found on the board of directors. This should leave no doubt about the validity of the charity, and to date that has not been questioned.

What is in question, is Scott Stone's ability to make mature, well-reasoned management decisions. For some answers we can turn to the tax returns for the charity. The returns for North Carolina Heroes Fund are available for years 2007 - 2009 on Guidestar.  From the dates on the forms and the receipt stamps it is easy to see that each year the taxes were filed on time. I find it odd that the one year the tax returns were not filed by the May 15 deadline is the same year in which Stone decides to run for Mayor. It makes me wonder if there is something he is hiding.

In the Charlotte Observer piece linked above, Jim Morrill was able to obtain the basic numbers for 2010 from Scott Stone who said the returns have not been made publicly available. I also find this odd, since according to the IRS Stone has to make the past three years available upon request. If that request is made in person, it should be honored on the same day. If the request is made by mail, email or phone there is a 30 day period in which Stone can comply with the request. It seems to me the only reason Stone wouldn't have to provide the tax returns for 2010 would be if he has yet to file the return. [Update: I requested these forms by email through the website and by contacting Tariq Scott Bokhari, the Treasurer of record for NCHF. I received an email from Tariq within a few hours saying he would have the copies to me next week which is well within the 30 days.]

A basic look at the returns that are available shows that in 2007, NCHF raised about $15k and gave one grant of $1500 which is a 10% pass through to the cause. In 2008, NCHF raised about $51k, made grants totaling $13k to veterans and had expenses of around $22k. This means about 25% went to the cause and 43% went to expenses. In 2009 NCHF raised around $103k, gave grants to veterans totaling around $25k, paid a professional fundraiser about $42k and incurred other expenses of around $26k. This represents a pass through of around 24% to the cause, 41% to the professional fundraiser and 25% to other expenses.

The Observer quotes fundraising experts saying they look for charities to spend less than 25% on fundraising and administrative costs, but the expenses may run a little higher in the early years. Stone claims this is the case and though he has not released the tax returns for 2010 the numbers he offers show the percentage of money given as grants to veterans was closer to 53%. While the improvement is duly noted, Stone's "spend big or go home" attitude demonstrated in previous years' returns sends up a great big red flag complete with siren sounds and flashing lights.

By February of 2009, Stone had NCHF on Facebook, LinkedIn, Myspace and Twitter and at the end of February 2009 they launched a new website. Later in the year they registered an account with You Tube.  A review of the fund's Facebook posts shows NCHF has averaged just 3 posts per month and in the more than 2.5 years it has been opened they have only appealed to its members to help grow the group once or twice. In other words, they have barely made an effort to grow the group and its donor base through one of the best free tools a charitable organization can have in its fundraising toolbox. Likewise, their Twitter presence has been nominal with an average of 4 tweets per month. The last tweet was on March 10, 2011. Again, some of the best avenues for building a donor base, volunteer base and for raising a charity's profile and name recognition have, for all practical purposes, gone unused.

It is understandable that Stone would set aside some money each year to give NCHF some working capital to start the next year's fundraising efforts. However, NCHF has almost zero overhead and Stone is in complete control of the amount the fund gives in grants. To say it takes money to make money falls a little flat when it doesn't appear that Stone or any of his volunteers made much of an effort to use the free resources available through social media or their own website. Stone has amazing resources at hand listed as advisory board members and members of the board of directors. It's hard to imagine he hasn't asked the assistance of Senator Richard Burr, Congressman Mike McIntyre, Governor Jim Martin, Governor Jim Hunt and all of the other very impressive people who are listed here and here.

Taking care of our veterans is an honorable and important goal. From outward appearances, Stone did a lot of things right. He stacked his board of directors and advisory board with a list of very impressive names. He started accounts with Twitter, Facebook, You Tube and other social media. He set up a website. He started raising money. He also spent a large percentage of the fund's donations on fundraising and other expenses. The economy has made it difficult for most charitable organizations to raise money, but instead of working twice as hard to see that this group with an impressive setup and honorable cause succeeds, it appears that Scott Stone quit. The website news page hasn't been updated in over a year. There have been no fundraising events posted. In two years there have only been two videos posted to their You Tube channel.  The Facebook page shows no fundraising events in 2011 and the Twitter account has not been used in seven months. Also, a Google search turns up no recent activity for the North Carolina Heroes Fund. Fundraising got tough and when it did, it appears Scott Stone gave up.

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Comments

Smells like Stephen LaRoque

Good cause, questionable competence, shady dealings. I look forward to hearing more about this.

For me

it wasn't so much that there was anything shady, until I realized he is using a relatively inactive charity as the first item on his community service resume.

I will not accuse him of using veterans as a political prop, but it certainly looks like it is toeing that line.



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Vote Democratic! The ass you save may be your own.

What is the latest?

It seems that Laroque has dropped from sight. Haven't heard anything at all. What is the latest or have his sins been washed clean by the muddy waters of the Neuse River ?

Hi Betsy...

love your new sig line. Shady or not...darn sure foolish and irresponsible. Want him handling the taxpayer's monies...not! I hope the paper goes after him with a vengeance.

Stan Bozarth

Thanks, Stan :)

I doubt the Observer will do much more. I did inform them that their math was wrong. :)



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Vote Democratic! The ass you save may be your own.

Great work, Betsy

If his claims were true that the organization's still in its growing phase (or whatever), and that the Recession is making it harder to pull in donations, then 2011 should have seen a flurry of activity. As opposed to none.

It looks like they just quit

...and are taking whatever money is raised by another group and given to them.

Sadly, it is that decision that makes Stone look like he is using veterans as a campaign prop.



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Vote Democratic! The ass you save may be your own.

Kohn

Kohn Associates is a Republican outfit most closely associated with the Elizabeth Dole campaign.

Not sure they are still using her firm

Won't know until I see the 2010 returns. The Patriot Gala in Charlotte is giving NCHF and 5 other charities a share of their fundraising.

I hadn't made the connection with the Dole campaign. Very interesting. She also hasn't marketed her page on Facebook. She only has 3 likes...lol.



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Vote Democratic! The ass you save may be your own.

I think it's dissolved

Yep. As of 08/25/2010, but there's probably a new company...

Anonymous commenting

Is now enabled at BlueNC.

Sounds like LaRoque has been giving out pointers.

Having been born in Lenoir county, and having my grandmother not only serve in the seat Laroque now holds, but also was the MD that delivered him, I have a special distaste for Laroque and the people like him that suck at the public and private tit for their own gain.

Laroque is bad enough with using public funds in the manner he has for his own gain, but Scott Stone's scam is even more distasteful. Raising money for veterans in need and getting less than 25% to them is morally criminal.

But we better be careful, maybe Stone is like Laroque, one of the lawyer hating GOP scum that bitches about worthless lawsuits, but loves to file them themselves if anyone dare say a word about them.

To me, it sounds like Stone is as morally bankrupt as Laroque, and if that is the case he needs to be kept out of government at all cost.

The great shame of Laroque is that his parents were wonderful, civic minded folks, that were also good democrats. I never understood what went wrong.

As for me, if someone sends this to Laroque, I might need a lawyer. But that, as James says " expletive deleated" gentleman just might then need a doctor.

In closing, I have had a thought that it might not be Laroque's fault. I have always thought that my grandmother might have dropped him on his head when he was born.