Tax-Form Check-Off : ‘Chickadee’: Bird in Hand for Charities

They’ve put a little heart into taxes: In many states now, taxpayers can check off boxes on their state income tax forms and donate money to a good cause--the arts in Oregon, for example, or wildlife in Louisiana, or the state veterans home in Illinois.

What’s more, they do it. In Idaho, almost 20,000 taxpayers gave $92,843 to protect non-game wildlife (the so-called “chickadee check-off” common to many states). California state taxpayers donated a total of $1.5 million to funds for wildlife, the elderly, child abuse prevention and the U.S. Olympic Committee, and Arkansas raised $55,000 to repair Little Rock’s War Memorial Stadium.

“You’d think people would really be surly by the time they get to the end of their tax forms,” said Helen Adorjan, spokeswoman for Illinois’ Department of Revenue, “but we got a lot of money.”

Several Vie for Funds

Taxpayers are so willing to give, particularly when they expect tax refunds, that several different check-offs already compete for their money in some states and other needy groups are lobbying to get on future forms. Taxpayers are so willing, given the ease, that they check off their gifts without further thought or inquiry, often funding groups of little pedigree or track record, and no apparent need to explain themselves.

This new philanthropy probably had its genesis in 1967, when the federal government first gave taxpayers the option of designating one tax dollar to fund presidential campaigns. States soon followed with invitations to contribute extra dollars to state campaigns. And, in 1978, Colorado offered the first chickadee check-off, letting taxpayers earmark tax refund money for wildlife preservation.

By 1984 it was a fad. Thirty-four states had check-offs of their own and even the IRS was inviting taxpayers to enclose voluntary contributions “to reduce the public debt.”

‘Don’t Get Any Grief’

“Don’t quote me,” one state official said, “but legislators like to authorize this type of legislation because it doesn’t take tax dollars away from anything and they don’t get any grief over it.”

Getting any check-offs on a tax form for the first time, however, was an uphill fight in many states. Revenue departments were often the bitterest antagonists, fearing that they would have extra work and costs without extra money or manpower. Many had made great efforts to keep their state forms short and simple, and the added category was “mucking up our nice clean form,” Adorjan said.

Moreover, they were philosophically opposed “not to the programs themselves,” California’s Franchise Tax Board spokesman Will Bush said, “but to using the state tax form for the collection of non-tax dollars.”

“The more people see the system used for things other than direct tax services,” added Karen McKinzie, the board’s manager of legislative analysis, “the more the possible impact on their willingness to comply.”

Initial Setup Costly

As it turned out, most states found only the initial setup--mostly computer programming--expensive. California took up to 13% of the money collected for each of four funds the first year, but thereafter only 3 1/2 cents per donation. Illinois, among others, takes nothing for its subsequent handling costs.

In many states, donations must come from expected refunds (the source of most donations anyway). Some--California included--allow taxpayers to add donations to their tax liability as well.

In fact, one would do better in California by mailing separate checks directly to the funds. California--not wanting to create a new deduction and diminish revenues--specifically declared such gifts-by-designation non-deductible, although they certainly qualify as charitable contributions by IRS standards, the standards of many other states, and probably would by California standards if sent as direct gifts.

So far, wildlife is the most common check-off (31 out of 34 states), followed by child abuse prevention (8) and the U.S. Olympic Committee (5), according to the Federation of Tax Administrators in Washington.

Wildlife a Strong Draw

Moreover, wildlife often pulls in the most money: 25% more than child abuse prevention in California last year, 60% more than the U.S. Olympic Committee, and 122% more than the elderly. Idaho taxpayers gave wildlife more than twice the money that they gave the U.S. Olympic Committee and almost four times what they gave drug enforcement efforts.

Illinois taxpayers, however, gave child abuse prevention nearly twice the money ($498,337) that they gave wildlife. “We had some inner city people saying people were more important than barn owls and bald eagles,” Illinois Sen. Virginia Macdonald said.

Some check-offs are enthusiastically promoted by those--usually state agencies--assigned to receive the money; others just accept what comes as an unsought windfall.

Idaho’s Fish and Game Department urged tax preparers to tell clients of the check-off and enlisted actress Mariel Hemingway to tell the general public. Illinois’ Department of Conservation spent almost $10,000 promoting its 1983 wildlife check-off, contacting outdoor advertisers, radio stations, sportswriters, banks and anyone with newsletters, and getting a lot of free space for its “check us out” posters, brochures, public service spots and envelope stuffers. The result was $259,972 for non-game wildlife and a promotion budget this year of $13,000.

Small Percentage Give

Still, only a small percentage of a state’s taxpayers contribute. The 5.4% of taxpayers who gave for wildlife in Oregon last year were considered a good turnout. They contributed $247,143, or an average of $4.63 apiece. Only 1% of California’s 10.5 million state taxpayers gave an average $4.68 apiece for wildlife last year, producing $511,012.

As for who gives, Oregon found that contributions to wildlife and to the arts started respectively at 5% and 2.6% of those with incomes under $10,000, rose steadily in each case to highs of 6.5% and 4% of those with incomes of $40,000 to $60,000 (the “yuppie” stratum), and fell to 1.1% of those earning over $100,000 in both categories.

There is already some indication that the number of check-offs simply dilutes taxpayer generosity. When Oregon added an arts check-off to its 2-year-old wildlife fund in 1981, wildlife contributions fell from $365,000 donated on 8.5% of returns to $277,774 on 5.9%, with arts taking up the slack--$133,639 from 3.1% of the returns.

Taxpayer generosity may also dry up with refunds, which are apparently treated like “found” money. “We notice people often just round off the amount of their refund,” said Kathy Posey, spokeswoman for Louisiana’s Department of Revenue and Taxation. “If it’s $77.50, they might give $7.50 to wildlife.”

Relatively Unquestioning

Less refund money means fewer donations, as Louisiana found when its state tax was increased for 1983, halving the number of refunds, and cutting total check-off donations from $315,270 to $147,332.

The sense of dealing with “found” money also seems to make people relatively unquestioning, particularly because “it’s on your tax return, so you have confidence that it’s really worthwhile,” said Adorjan of Illinois. In many cases, donors just respond to buzzwords-- “California Seniors’ Fund,” “Wildlife Protection Donation,” “Children’s Trust Fund”--supplemented by a vague description of fund goals, without specifics on either use or administration.

“Contributions entered on line 90,” California’s booklet said, “will be used for the conservation of endangered and rare fish, wildlife and plants.”

There often are specific beneficiaries, of course, and even concrete accomplishments. Colorado has already taken six species off its endangered list--five fish and a white pelican. Oregon’s Arts Commission put the $226,000 collected from 1982 and 1983 returns into grants, ranging from $463 for lighting tracks to display art in a civic building, to $1,000 for portable equipment for a performing group, to $10,000 so that a community radio station could move to its own building.

Gifts Doubled Budget

For the Illinois Department of Conservation, 1983’s $260,000 in check-off money more than doubled the budget, funding three new staff positions and a number of small projects--from artificial roosts for double-crested cormorants, built because of a lack of dead trees, to workshops that help ordinary citizens build backyard houses for bluebirds, a native species in decline.

But how the money is spent and by whom is not always widely known, or perhaps even asked, nor does the public seem to require such information. Even revenue department people may not know.

“I have no idea who gets the money (from each fund),” a taxpayer information representative for California said. “It’s like the United Crusade; they put it into one big pot and then divide it up.”

So far, most check-off funds go to state agencies, following specific legislative dictates. But given the buzzword vagueness of the invitation to donate, what is done with the money may surprise some taxpayers.

Money Used for Promotion

Take California. Use of wildlife funds is probably the clearest, given the fairly concrete needs of kit foxes and condors and bald eagles and the rather obvious steps required to preserve habitats. But some donors might be surprised that the Fish and Game Department budgeted a quarter of the $479,382 that it received last year for this year’s promotion.

The California Seniors’ Fund, from 1983, is another matter. Some taxpayers assumed that the money collected ($200,000 net) went for activities and benefits for old people, nursing care and senior citizen centers.

In fact, only amounts over $325,000 were to be allocated for direct services, so the entire $200,000 went to the “Senior’s Legislature,” a once-a-year mock legislature that lobbies the real Legislature. It was then spent on things such as in-state travel ($73,545), consulting and professional services ($26,180), general office expenses ($5,430) and video production ($25,000).

As for the state Children’s Trust Fund, established for the prevention of child abuse and neglect, taxpayers often assumed that the money received ($375,000 net) would go to some sort of home where they put abused children, hot lines and educational programs, or for therapy for abusive parents.

Abuse Prevention Aid

In fact, the office of child abuse prevention in California’s Department of Social Services, which handles the funds, included the money in its $700,000 1984-85 budget, which allocated $340,000 to a program of perinatal services-- education and support--for high-risk families, $115,000 to evaluate potential future projects, $140,000 to establish a central registry of abuse-prevention programs statewide, and a final $100,000 to develop more “self-help” groups like Parents Anonymous.

Not ‘Active Fund’

But it is not yet an “active fund” by department definition; the money was only budgeted and put into reserves when received. “We decided to let it build up until we had something substantial,” said Jim Brown, chief of family and children’s services for the department, which is only now contracting with outside organizations for the programs.

One problem is that these groups may quickly have more money than they have defined goals. And it can only be compounded as more groups rush in, some even beyond state control, such as it is. Few states seem to have rules about what kind of groups can apply, and to whom they must answer.

Waiting in the wings are groups representing Alzheimer’s disease research, the American Cancer Society, the Statue of Liberty restoration, alcohol and substance abuse, public broadcasting and, in California, protection of the unborn child.