RESIST, Inc.
Statement of Functional Expenses
for Fiscal Year 2008






RESIST, Inc.
Income - Fiscal Year 2008

At RESIST, we recognize that our donors seek to ensure that the majority of their funds are used to support the work of RESIST's grantees and our political education programs. We are also aware that may donors and potential donors look to charitable ratings bureaus as an independent means for assessing this information.

Better Business Bureau
At this time RESIST has been certified as an accredited charity by the Better Business Bureau serving in Eastern Massachusetts, Maine, Rhode Island, and Vermont. To read an online copy of the Better Business Bureau report, please visit: http://boston.bbb.org.

Charity Navigator
A number of individuals have asked at different times about RESIST's allocation of resources. We recognize that our donors seek to ensure that the majority of their funds are used to support the work of RESIST's grantees and our political education programs. We also are aware of our current rating by Charity Navigator and the fact that we are not certified by the Better Business Bureau. We want to assure you that these ratings do not accurately reflect our fiscal management or programmatic spending.

There are several factors contributing to our current rating on Charity Navigator. First, Charity Navigator pulls information directly from the previous year's 990 form. RESIST allocates approximately 60% - 70% of our annual resources to program related expenses. In 2008, however, the IRS imposed significant new auditing standards for non-profits that require an extraordinary number of additional hours to be spent by staff and our auditor, Linda Smith, on financial oversight. These new standards are as a result of several large for and not-for-profit management scandals. The new standards are applied across the board- whether you are a $500,000 or a $5,000,000 organization. In addition, as part of its commitment to provide a safe and healthy work environment, RESIST provides health insurance to staff members. Even as costs have spiraled, RESIST has worked diligently to maintain this benefit. As a result, these events have impacted our program percentage.

Second, charity evaluators (including Charity Navigator and the Better Business Bureau) often use the same tool to assess a huge range of non-profits. These tools are the same whether they are evaluating a large private foundation like the Rockefeller Family Fund, an organization like Amnesty International, a small activist group like Jobs with Justice or a small public charity like RESIST. As a result, organizations like RESIST, often find that we are negatively impacted by this Aone-size fits all@ approach to evaluation.

As you may know, all foundations spend time on general administrative functions in order to maintain appropriate fiscal and organizational oversight; however the amount of time spent on fundraising varies based upon the foundation=s size, donor profile and resources. For instance, large private foundations that are either endowment based or have a limited number of large donors do not spend considerable resources on fundraising. Their organizations are able to utilize a percentage of the income derived from their investments to fund their work- which requires only a limited amount of resources to manage. Other non-profits are able to raise significant amounts of foundation dollars with a limited investment of time. Large public charities and donors of significant wealth, however, are generally not willing to support a radical activist funder like RESIST. As a result, 100% of RESIST's income is generated from the contact we make with individuals like you across the country. In the end, the resource allocation percentages for many non-profits (who receive substantial foundation and institutional funds) and large private foundations (who derive their wealth from endowments) meet the cold standards that evaluators like Charity Navigator or the Better Business Bureau have established.

In addition, RESIST tries to level the playing field between those who do the work on a daily basis (the staff) and those who have the power to set organizational directions (the Board). At this time, our Board of Directors has 23 members, four of whom are also staff members. No Board member is compensated for their work. Staff members receive a salary, but this is not payment for their role as Board members. As a result, Charity Navigator and the Better Business Bureau calculate that 17% of our Board of Directors receives compensation for their work (exceeding their mandate that only 10% of Board members receive compensation). In order to meet their standards- RESIST would be required to have 40 members on the Board of Directors. As a result, this lowers our credit rating as well.

We will continue to work with Charity Navigator and the Better Business Bureau to explain the unique position of small public foundations like RESIST. In the meantime RESIST has been working to lower our fundraising costs by increasing our electronic communications and fundraising efforts. While we must keep all our constituents in mind (some of whom are not electronically savvy) we do give donors and subscribers to the Newsletter the option of receiving their communications electronically. Approximately 1,800 subscribers receive their Newsletter via e-mail at this time. We also enable donors to use a secure "donate now" button on our web site to do on-line giving. These efforts lower our fundraising costs and save precious environmental resources. In 2010, we will continue our work to find new electronic fundraising and communication strategies.

In order to clarify these issues, RESIST is always willing to talk with those who have questions, and provide both our IRS Form 990 and a copy of our Audited Financial Statements.

Please feel free to contact Malika McCray, RESIST's Director of Development, at malika(at)resistinc.org directly with any additional questions or concerns you may have.

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