When It Comes To Charity All Donation Bins Aren't The Same

NORTH TEXAS (CBS 11 NEWS) - You probably used to run to the Goodwill or Salvation Army after cleaning out your closet. Now, new options are popping up all over. But, the CBS 11 I-Team has learned you can't judge every donation bin by its cover.

When Senior Investigative Reporter Ginger Allen called the number on a donation box with M.A.D.D., Mothers Against Drunk Drivers, boldly displayed on the front , someone answered the phone and identified the location as a "recycling center."

"Recycling center?" questioned Allen. "You are not M.A.D.D.?"

But LeeAnn Derdeyn is mad. "A lot of drop boxes are not for charity and you don't realize it, " says Derdeyn.

She recently went to a parking lot near Ledbetter Road and Hampton Drive southwest of Dallas.

There are five-donation bins in the lot. Derdeyn says she assumed they were all owned by five-different charities.

But when Derdeyn looked closely at one of the bins, she found a disclaimer, in what she describes as very small print, revealing the box is owned by a for-profit company.

"You think you're donating here to M.A.D.D which is of course a good charity, " says Derdeyn.

The charity watchdog group, Charity Watch, tells the I-Team it receives angry calls about these bins all the time. Spokesperson Stephanie Kalivas tells Allen many of the bin companies nationwide bundle the clothes and sell them overseas where they are used for clothes, padding and insulation.

So the CBS 11 I-Team scoped out 20 bins in North Texas. We learned most of them are owned by recycling companies. Some disclose it. Many do not.

We found two- in North Texas that had a cartoon dog on the front right next to the logo for Operation Kindness. It reads: Donation box. Bagged clothing & Shoes. A phone number is listed above the website give-stuff.org.

The website and phone number brought us to downtown Dallas to National Recycling Solutions (NRS).

Titan Lowery is the Director of Operations. Lowery proudly showed us his warehouse and showed us the recycling center.

Lowery told CBS 11 much of their profits goes to charity. A "considerable amount. I can't say amounts because I don't' handle the finance part," explained Lowery.

Lowery says NRS sorts and sends the appropriate donations to its charities which include Operation Kindness and Captain Hope's. He says blankets go to Operation Kindness for animals. But he says the majority of their contributions to the charities are cash.

He encourages frustrated consumers to "look deeper into what we do." Lowery says, "A lot of people have misconceptions of what we do. We are a textile recycling company, but we concentrate on keeping all clothing out of the waste field."

Texas Business and Commerce Code Section 17.922 states that the owners of for-profit donation bins must label them with the "name of the charity" and the "percentage of the proceeds" or a "flat fee" it receives.

NRS's bins do not comply with these standards. NRS is not on the bin. The address is not on the bin. And, the amount of the charitable donation received by Operation Kindness is not on the bins we found.

Lowery looked at the code and said he was unaware of the law. He told Allen, "I did not know that until now. We will fix it immediately." He said, "We will do everything we can to be applicable to that. I will immediately go pull this and we'll make changes to our bins."

Just a few miles from NRS, we found American Textile Recycling Services also in Dallas. The Chief Marketing Officer Debra Stevenson told us, since 2002, "we've diverted 55 million pounds of clothing, shoes, and other household textiles."

In North Texas, she said ATR donates to Cooke Children's Hospital in Fort Worth, Children's Hospital in Dallas and M.A.D.D., Mothers Against Drunk Driving. "We, in 2014, will give close to $100,000 to these charities in the Dallas area."

"Our goal is make sure everything is reused and resold or recycled, and if our charities can use items, they get them first."

ATR's name is displayed on its bins, but the I-Team discovered there is no company address and ATR's disclosure does not give a flat fee or a percentage of the proceeds which benefit M.A.D.D..

Stevenson quickly acknowledged some bins are not in compliance and said the company is working on it.

"You will begin working on those boxes and start complying?" questioned Allen. Stevenson said, "Yes we have been. We have been."

Stevenson said city officials in both Fort Worth and Dallas had already contacted ATR discussing the needs for corrected signage.

Another donation box the I-Team found is marked with the name and logo of the Dallas charity, Jonathan's Place. The box reads: "Serving Dallas area kids…benefiting seriously abused, neglected and hungry children." It also includes the phone number 469-867-2948.

The I-Team found that same phone number on another box on a Dallas school campus. That box also had a drawn picture of a small yellow house on it. We called the number and talked to David Makatura, the owner of WRCC, Inc.. He described WRCC as thrift store which sells the donated items. He also said a portion of his proceeds are returned to the school.

The I-Team learned Makatura's donation bins are also in violation of state law because they are not marked correctly. Makatura sent us a statement saying, " Thank you for bringing the requirements Texas Business Commerce Code section 17.922 to our attention. We will, of course, move immediately to modify our signage to become in full compliance with the law."

The local companies say they are diverting items from landfills and benefiting local charities.

Moms, like LeeAnn Derdyn, say they need to make that clearer. "I think the intention of the law is to let people make an educated decision about their donations."

The I-Team will check back in a few weeks to see if the companies we talked to are complying with law and changing their signage.

Allen talked to several charities which have partnerships with these bin companies. All of them praised their business partners.

The Chief Operating Officer of Operation Kindness, Jim Hanophy, sent us the following statement:

"We receive approximately $65,000 a year in donations from National Recycling Solutions. We very much value the relationship with them and the support we receive. We are grateful to people who donate items to them and to have a partner who has the ability to sell those items and help fund our mission."

(©2014 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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