Skeptical About Your Red Cross Donation? Follow The Online Paper Trail

Agency says 91 cents out of every dollar donated goes directly to aiding survivors.

Say what you will about the federal and state governments' response to the Gulf Coast disaster; American citizens have proven once again that they know how to provide swift and abundant aid in the wake of catastrophe.

Ten days after Katrina ravaged the Gulf Coast, nonprofit organizations had received upward of $580 million from individual and corporate donors — a pace of giving that was unparalleled in U.S. history, according to The Chronicle of Philanthropy. That outdid by a long shot contributions made in the same time frame after last year's tsunami ($163 million) and was more than double the relief generated after the 9/11 attacks ($239 million).

Of the nonprofits, none have seen as much action as the American Red Cross. With President Bush and just about everybody else with a pulse asking the public to donate funds to the Red Cross, the agency has raked in $485 million toward disaster relief. It estimates spending about $1 billion on the catastrophe when all is said and done.

But with so much money flowing into nonprofits, many donors may be wondering: "Am I buying coffee for administrators, or is my money actually getting to the victims?"

"After 9/11, charities like the Red Cross — which was subjected to a congressional inquisition — got a lot of criticism for collecting money on behalf of victims and using that as a cushion for the next catastrophe," said Michael Solomon, director of communications for The Chronicle of Philanthropy.

"What donors need to do is go to the charity's Web site and see how they say they are going to use the money and if they have a question, call," Solomon said. "Usually they'll be happy to establish a relationship with you so you know what the charity is using the money for and if it's being used the way you want them to. That way everyone will be happy, and charities want that because they want happy donors who will continue giving."

As for the Red Cross, it's certainly been funneling money toward Katrina victims; nearly 160,000 Gulf Coast evacuees are being housed by the organization in more than 650 shelters in 17 states. More than 5 million hot meals and as many snacks have been distributed, according to the agency's records, with up to 600,000 meals prepared each day.

The Red Cross is also directing some of its funds to meet unexpected needs. In Los Angeles alone, more than 300 families have shown up at the shelters unannounced.

"We didn't know they were coming. They just showed up on our door," said H.T. Linke, vice president of communications for the American Red Cross of Greater Los Angeles. "These are people who got in a car in New Orleans or Mississippi and drove out here, so we're just trying to care for them right now while we can in L.A."

Linke estimates that 91 cents out of every dollar donated goes directly to aiding the survivors, with the remainder going toward overhead costs and general administrative needs. And if you're a big donor, you can get legal assurance of that: By law, every donation over $250 has to be acknowledged with a follow-up reconfirmation call to the donor. The Red Cross also tries to acknowledge smaller donations, "because we want people to know we got their money and where it went," Linke said.

A good deal of money also goes to training volunteers. More than 56,000 workers across the country have been dispatched to the devastated region, 90 percent of them unpaid volunteers. These individuals must be trained to work on the ground, transported to the Gulf, and housed and fed.

To alleviate concerns on the part of the donors, watchdog groups like Charity Navigator and GuideStar track how nonprofits are using the funds. Thousands use GuideStar's Web site to research more than 1.5 million nonprofits, providing information on past IRS tax forms, employee compensation and grant activity.

"Some nonprofits won't give money directly out to the victims. Instead they will take the money and provide services, whether that is temporary housing or vouchers or things like that," said Dan Moore, vice president of public affairs at GuideStar. "[But] everyone is trying to be transparent and accountable."

To find out what you can do to help provide relief to victims of Katrina, head to think MTV's hurricane relief page.