Charity watchdog gives Clinton Foundation the highest possible rating

Thomson Reuters

WASHINGTON (AP) — A charity watchdog with an ongoing relationship with the Clinton Foundation gave the former first family's nonprofit high marks Thursday, after an evaluation prompted by the heightened interest in the organization.

The Clinton Foundation received four out of four stars — the highest rating that Charity Navigator gives after a close look at a charity's finances. The rating is based on annual federal tax documents. It was not intended to reflect whether Hillary Clinton kept donors to her family's foundation at appropriate arm's length or provided favored access as secretary of state.

Charity Navigator is a leading and respected organization that evaluates and rates charities so donors can make informed decisions about contributions. It was itself a member of the Clinton Global Initiative between 2012 and 2014. The Clinton group said Charity Navigator committed to spend an estimated $2 million over four years through 2016 to review more charities and provide more detailed information about them in its reviews.

Charity Navigator also participated in a Clinton Global Initiative program in 2011 with other groups to identify worthy charities for U.S. veterans, journalism integrity and Islamic outreach, but Charity Navigator did not contribute money as part of that effort.

Charity Navigator's president, Michael Thatcher, told The Associated Press that the Clinton campaign did not influence the rating.

The four-star badge comes at a time when the Clinton Foundation is under intense scrutiny about whether Clinton granted donors access at the State Department. An AP analysis found that of 154 people outside government with private interests who met or spoke to Clinton by phone, 85 had contributed either personally or through their organizations to the foundation. The Clinton campaign said Clinton would have met with the donors, anyway, in her role as secretary of state.

The watchdog had previously rated the Clinton Foundation with four stars in 2007, and in 2012 downgraded it to three stars due to changes in its methodology. Its original four-star rating was based on the foundation's financial health and performance. In 2012, it also evaluated the charity on accountability and transparency. Charity Navigator requires five independent board members, but the foundation had only three during the 2009 fiscal year, Thatcher said. The downgrade came the same year that Charity Navigator was a member of the Clinton Global Initiative.

Thomson Reuters

The Clinton Global Initiative waived its membership fees for Charity Navigator, as it does for nonprofits, nongovernment organizations and social entrepreneurs. Charity Navigator treated the $20,000 waiver as an in-kind donation. Thatcher said his group joined Clinton's to mingle with world leaders and promote its ratings.

He said the new rating was unrelated to Charity Navigator's relationship with the foundation. "The numbers speak for themselves," he said.

The rating itself is a fixed algorithm, described in detail on the watchdog's website. It looks at the financial health of charities and their accountability and transparency. In the Clinton Foundation's case, it scored 94.74 out of 100. It was dinged on two minor issues, its donor privacy policy and its process for determining the chief executive officer's salary.

The Clinton Foundation and Clinton campaign could not immediately be reached for comment.

Charity Navigator currently evaluates 8,351 charities, and most get a three-star rating.

According to its 2014 consolidated tax report, the Clinton Foundation spends about 12 percent of its budget on running the foundation. Another charity watchdog, Charity Watch, previously gave the Clinton Foundation an "A'' rating on a scale of A-F. Charity Watch has no connection to the Clinton Foundation, said its president, Daniel Borochoff. "We don't want money from charities we rate, because we believe in being an independent charity watchdog," he said.

Charity Navigator stopped rating the Clinton Foundation entirely in 2014 because it said changes in the foundation's business structure were incompatible with the way Charity Navigator calculates its ratings. After what Thatcher described as "unprecedented demand" for a rating for the Clinton Foundation, Charity Navigator asked the foundation to consolidate its tax forms in a way the watchdog could evaluate it. That led to Thursday's four-star rating.

Last year, Charity Navigator placed the foundation on its watchlist, a feature it added in 2014. A charity could have a four-star rating but also be on the watchlist, Thatcher said. In the Clinton Foundation's case, the group cited multiple concerns, including news reports about the foundation accepting donations from foreign governments. It had voluntarily sworn off that practice while Clinton led the State Department, but the donations started again when she left her post. This became a concern as she was expected to announce her presidential bid. Charity Navigator removed the foundation from its watchlist in December, after the foundation amended its tax returns and clarified its position on foreign donations.

Two of Trump's charities are listed as unrated on Charity Navigator's site because as private foundations they do not meet the watchdog's criteria for evaluation.

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Associated Press writers Stephen Braun and Jeff Donn in Boston contributed to this report.

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