News and analysis
August 04, 2017

Charities Split Over Ethics and Fundraising Risks of Returning to Mar-a-Lago

Mandel Ngan/AFP/Getty Images

President Trump and first lady Melania Trump arrive at a February 2017 Red Cross gala at Mar-a-Lago, Mr. Trump's Florida estate.

The American Cancer Society’s advocacy arm has spent a lot of time in recent months on Capitol Hill opposing efforts to fulfill one of President Trump’s signature campaign promises: repealing and replacing Obamacare.

But that didn’t cause the organization to change its plans to support Mr. Trump in another way. In February it will continue its 10-year tradition of holding a gala at Mar-a-Lago, the oceanfront resort that the president owns on the island of Palm Beach.

Yet another big cancer organization — Dana-Farber Cancer Institute — is moving to another of the island’s hotels next year, having faced opposition over 2017’s event from doctors, patients, and staff members upset by Mr. Trump’s policies on health care and immigration as well as insensitive remarks he has made about race and disabled people.

Just as the nation is split over its views of Mr. Trump, so too are many of the charities that have long held events in Palm Beach, where for years nonprofits from across the country have flocked to find millionaires and billionaires who spend the winter in the exclusive resort town.

Fundraisers say Palm Beach events are among the most lucrative they hold and provide an opportunity to court donors who have the potential to give big sums long after the galas are over.

Mar-a-Lago offers more space than any other venue in the area, increasing the opportunity to attract more donors. According to The Washington Post’s David Fahrenthold, at least 15 groups have booked dates for 2018.

Money Magnet

A Chronicle analysis of permit data shows how lucrative events at Mar-a-Lago can be.

In 2016, when Mr. Trump’s unorthodox and often controversial presidential campaign was in full swing, the Cleveland Clinic raised $963,029, after expenses, at an annual ball; Susan G. Komen brought in $700,00 at its 2016 Mar-a-Lago event, and the Palm Beach Police Foundation raised $643,975.

The American Friends of Magen David Adom, a charity supporting Israel’s emergency-medical team, raised $4.5 million in total at its 2016 “Palm Beach Celebration of Life” gala. (The organization would not share its revenue after expenses.) The group credited to the gala a big gift it received shortly after the event.

In all, data compiled by The Chronicle suggests that 17 groups raised more than $100,000 after expenses at Mar-a-Lago in 2016, with several raising more than $500,000. (Though it isn’t likely for most, it is possible that some of the permits refer to more than one event in Palm Beach or events held at another venue on the island.)

Although the figures fluctuate from year to year, those numbers are roughly in line with the previous year, before Mr. Trump was considered a serious contender for the White House.

For many charities, a Mar-a-Lago gala is one of the biggest fundraising events of the year.
"It’s definitely one of our highest-visibility events," says Erik Levis, communications director for the American Friends of Magen David Adom. Revenue from the Mar-a-Lago event is comparable to dollars brought in through the charity’s galas in Los Angeles and New York City, he adds.

Many charities say the financial benefits of continuing to hold events at Mar-a-Lago make it difficult to consider moving them elsewhere.

"We really looked at: What was the best possible venue to raise the most possible money to support our mission," says Brant Woodward, executive vice president of the Southeast region for the American Cancer Society. The organization raised $454,000 at its Rock Palm Beach event in February.

He says the charity’s decision to hold an event at Mar-a-Lago wouldn’t interfere with its mission, including its advocacy for affordable access to health care and federal funding for medical research. "We will continue to advocate strongly for those issues," Mr. Woodward says.

Limited Choices

Mar-a-Lago and another resort called the Breakers are the only two that can accommodate large events on the island, charity leaders say. Mar-a-Lago’s ballroom can hold 750 people, while the Breakers can accommodate affairs of 500 — making booking events at the locations competitive. And Mar-a-Lago has the benefit of being a historic venue: a tony mansion sitting on a 20-acre estate once owned by breakfast-cereal heiress Marjorie Merriweather Post.

Costs to use the venue can vary widely, from $33,000 to upwards of $500,000 for the 2016 season, according to permit data. The costs include services not provided by the club, such as event promotion and entertainment.

Dusty Sang, co-founder of the Ryan Licht Sang Bipolar Foundation, says his group has held its "medical-briefing" luncheons at the club for four years and will do so again in January.

It’s simple, Mr. Sang says: The property "can accommodate the traffic, and the staff have proven to be some of the best in the country."

Each year, the foundation looks back on its event and examines the quality of the venue to decide if it should return. "If they do a great job, we’ll be back for a sixth year," Mr. Sang says.

Optics vs. Conflict

Mar-a-Lago has been dubbed the "winter White House," because Mr. Trump visited it frequently in his first few months in office. The president, who has declined to divest from his vast business holdings, could profit from some of the events held by charities at Mar-a-Lago — but only marginally.

Hosting events at Mar-a-Lago with Mr. Trump as president falls into an ethical "gray area," says Richard Walker, a fundraising consultant at Orr Associates. With Mr. Trump now in the White House, "there are so many factors here that didn’t exist a year ago."

Doug White, a philanthropy adviser, is more blunt, arguing that charities should shun the venue because, on its face, renting a club owned by the president presents a conflict of interest.

Even if a charity does not intend to curry favor with the president, some people may perceive it that way, he says. "It’s the symbolism of it more than the actual cash in [Mr. Trump’s] pocket for me," Mr. White says.

Weighing the Options

For many in the nonprofit world, the most troubling part of charities holding events at Mar-a-Lago is that the president’s policies are at odds with the missions of many of the charities that will be holding events there next year.

For instance, the American Cancer Society and two other cancer organizations — Susan G. Komen and Hearing the Ovarian Cancer Whisper — will hold events at Mar-a-Lago in early 2018. That’s despite a proposed White House budget that calls a nearly $6 billion cut to the National Institutes of Health, including a $1 billion reduction to the National Cancer Institute.

Achilles International, which helps wounded veterans and military personnel participate in marathons and other running events, will also hold an event in 2018 — despite outrage over Mr. Trump’s mocking of a disabled reporter during his campaign.

Other organizations have decided to steer clear, including the animal-welfare organization American Humane. The group cited Mr. Trump’s sons’ big-game hunting trips when deciding to move its events to the Breakers, according to the Palm Beach Daily News.

Mr. White thinks that nonprofits holding events at Mar-a-Lago should explain to the public why they think the venue is appropriate. If the explanation is "we’ll raise more money, [and] that’s more important than a conflict of interest or that’s more important than the ethical considerations or whatever else, that’s fine," Mr. White says. "I wish somebody had the honesty to say that."

Limited Choices

Other experts are less concerned that Mar-a-Lago presents a conflict of interest for charities.

If nonprofits hold events at Mar-a-Lago to influence Mr. Trump, that would be a bad tactic, says Leslie Lenkowsky, professor emeritus of public affairs and philanthropic studies at Indiana University. He notes that Mr. Trump earns profits in many ways from his businesses; charity events held at the club are small potatoes.

"Any charities that say ‘Let’s go do our fundraiser at Mar-a-Lago because Donald Trump will be grateful to us for the business’ is probably mistaken," says Mr. Lenkowsky, a Chronicle of Philanthropy columnist, adding that he doubts most charity supporters will take a dim view of holding an event at the property.

For many charities, the decision comes down to the bottom line. Phil Hills, president of the Marts & Lundy fundraising consulting firm, says that while charities should consider the potential for blowback among their supporters when selecting a venue like Mar-a-Lago, money should be the biggest consideration. "You should probably hold it at whatever location gives you the best return," he says.

Nonprofit staff members should consult with trustees, donors, and volunteers if they are unsure about a location, he says, to get a sense of whether the event might cause a stir.

"The biggest problem is that you don’t want the location [where] you’re doing the event to overwhelm the message of what you’re trying to raise money for and what your cause is," Mr. Hills says. "If the story suddenly becomes Mar-a-Lago rather than the American Cancer Society or any other organization, then you’re not really getting people to focus on your mission."

Leaders at Hearing the Ovarian Cancer Whisper, a Jupiter, Fla., organization that provides financial aid to women with ovarian cancer and educates the public on the disease, haven’t even discussed moving its "Time Is of the Essence Luncheon" held each January at Mar-a-Lago, says Fern Fodiman, the group’s board president. "We’re happy with how Mar-a-Lago has accommodated us with this luncheon in the past, and we’re staying with it just for that reason," she says. "We don’t get involved in any political aspects."

Ms. Fodiman says the group hasn’t heard from supporters who are upset about the choice of venue, and she doesn’t think use of Mr. Trump’s property in 2018 will significantly affect fundraising.

"If some people don’t [like] his views and they drop out, it doesn’t matter," she says. "We have a strong enough draw of people who are there for the cause, not necessarily for the person who owns the property."

This article has been updated to include information on a fundraising event for American Friends of Magen David Adom.

Maria Di Mento contributed to this article.

Clairissa Baker contributed reporting through the Investigative Reporting Workshop at American University. Timothy Sandoval is a reporter for The Chronicle. Send an email to Mr. Sandoval.