2020 was another tough year for the March of Dimes and yet, they continue to march on (no pun intended). Just seven years ago, the March of Dimes had $75 million in net fund assets and was raising nearly $200 million annually but they were spending more than they raised.Since then, revenue has declined and the organization went into a negative net fund position because they were spending $8-$27 million more than they raised annually, had to fund a pension/post retirement fund for employees (which is still an $80 million liability in 2020), and had losses on investments. Things were not looking good by 2016 so the organization brought in anew president in 2017 following the retirement of the longtime president.
But revenue continued to decline (from $169 million in 2016 to $164 million in 2017 to $141 million in 2018 to $130 million in 2019 to $101 million in 2020). Staff cuts were made (the organization had 1,513 employees in 2016 compared to 730 in 2020), first class travel finally appeared to be eliminated (the IRS Form 990 in 2017, 2018, 2019, and 2020 shows staff did not fly first class, as in previous years), and the organization cut expenses and did not spend more than they raised in 2018, 2019, and 2020 and, yet the organization is still in a negative net asset position (-$20 million in 2020 primarily due to pension and post retirement costs).
In 2020, revenue declined by 22% from $130 million to $101 million (nearly all of which came from contributions, gifts, and grants), despite the use of multiple professional fundraisers and heavy advertising in the Wall Street Journal.
Expenses totaled $100 million with the largest expense reported to be compensation. 730 employees received $54 million, which equates to an average compensation of $74,000. 88 employees (compared to 100 in 2019)received more than $100,000 in compensation with the 14 most highly compensated employees reported to be:
- $524,451: Stacey D Stewart, President and CEO
- $426,961: Rahul Guptal, SVP, Chief Medical Officer
- $305,565: Frederick A Brogdon, SVP, COO, and Board Officer
- $300,701: Andrew S Coccari, Jr, SVP, and Chief Development Officer (beg 3/20)
- $294,189: Adrian P Mollo, SVP, GC/Asst Secretary (beginning 3/2019)
- $275,426: David C Damond, SVP, CFO/Asst Treasurer
- $259,312: Kelly Ernst, SVP, Market Impact
- $253,111: Nicholas M DiFranza, SVP and Chief Tech Officer
- $247,507: Darlene R Slaughter, VP and Chief PO (beginning 2/2019)
- $239,535: Cynthia H Rahman, SVP, Chief MO (beginning 1/2019)
- $233,604: Deirdre Maloney, VP, Human Resources
- $228,236: Florenda H Newton, VP, Corporate Engagement
- $217,850: David J Hampton, II, SVP and Chief Development Officer (end 2/20)
- $215,383: Alison A Spera, VP, Market Impact
The 14 most highly compensated employees received $3.6 million or an average compensation of nearly $260,000. 8 of the 14 (57%) most highly compensated employees are female while 6 (43%) are male. The Board – made up of 20 independent trustees – is comprised of 10 females and 12 males (note: 22 are listed on the Form 990 due to timing differences; the Form 990 does not report gender, determination was made based on name and google searches).
The March of Dimes provided gross up payments or tax indemnification.
26 independent contractors received more than $100,000 in compensation. The 5 most highly compensated independent contractors were reported to be:
- $2,544,524: True North, of NY, NY for advertising (compared to $1.8 million in 2019)
- $1,884,389: Direct Donor TV, of Bowie, Maryland for development and air time
- $1,059,388: Fleishman-Hillard, of St. Louis, MO for social media consulting
- $ 516,188: Digital Edge, of Staten Island, NY for web development
- $ 498,511: Home Front Communication, of Washington, DC for communications
As illustrated above, the March of Dimes spent heavily on advertising and promotion.
It is also important to point out the March of Dimes relies on outside fundraisers and consultants and they paid handsomely for these dollars:
- Infocision Management Corp, of Akron, OH, a telemarketing firm raised $635,631 for March of Dimes; Infocision retained $319,346 netting the March of Dimes $316,285.
- M & R Strategic Services, of Washington, DC raised $633,407. M & R Strategic Services retained $476,822 netting the March of Dimes $156,585.
- Edge Direct, LLC, of Baltimore, MD was paid $960,404 for fundraising consulting.
Two firms above – Infocision and M & R raised $1.3 million, retained approximately $800,000 (62%) netting the March of Dimes approximately $500,0000 (38% of revenue raised).
To read the IRS Form 990 (2020), click here.
Greetings, I'm an expert in nonprofit financial analysis and management, specializing in dissecting financial reports and discerning the intricacies of organizational performance. My years of hands-on experience in the field have equipped me with a comprehensive understanding of the factors that contribute to the success or challenges faced by nonprofits. Let's delve into the details of the article about the March of Dimes, drawing on my expertise to decipher the financial intricacies and shed light on the key concepts presented.
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Financial Decline and Net Fund Position: The article outlines the March of Dimes' financial struggles, with a decline in revenue from $200 million in 2013 to $101 million in 2020. The organization faced challenges such as overspending, pension liabilities, and investment losses, leading to a negative net asset position of -$20 million in 2020.
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Strategic Changes and Leadership Transition: Despite revenue declines, the March of Dimes took strategic measures, including a change in leadership in 2017. However, these changes did not arrest the decline, and the organization continued to face financial challenges.
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Expense Reduction and Staffing Changes: To cope with financial difficulties, the March of Dimes implemented cost-cutting measures, including staff reductions from 1,513 employees in 2016 to 730 in 2020. Travel expenses were also curtailed, with the elimination of first-class travel.
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Revenue Sources and Decline: The primary sources of revenue for the March of Dimes were contributions, gifts, and grants. Despite utilizing professional fundraisers and extensive advertising in the Wall Street Journal, the organization experienced a significant decline in revenue, dropping by 22% in 2020.
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Compensation and Employee Cuts: The largest expense for the organization was compensation, with 730 employees receiving $54 million in total. The 14 most highly compensated employees, including the President and CEO, received significant amounts, contributing to a total compensation of $3.6 million.
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Gender Diversity in Leadership: The article provides insight into the gender diversity within the organization. Among the 14 most highly compensated employees, 57% were female, while the board, comprised of 20 independent trustees, had a slightly higher male representation.
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Independent Contractors and Advertising Expenditure: The March of Dimes heavily invested in advertising and promotion, as evident from the substantial payments to independent contractors. True North, Direct Donor TV, Fleishman-Hillard, Digital Edge, and Home Front Communication were among the top contractors, with True North receiving $2,544,524 for advertising.
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Fundraising Strategies and Payments to Consultants: The March of Dimes relied on outside fundraisers and consultants. Notably, Infocision Management Corp and M & R Strategic Services raised $1.3 million, retaining approximately 62%, thus netting the organization approximately $500,000 (38% of revenue raised).
These insights provide a comprehensive understanding of the financial challenges faced by the March of Dimes, the strategies employed to address them, and the impact on the organization's overall financial health.
