No industry auction event had ever spawned such high stakes one-upmanship before a rapt audience. And all this over a mid-$40,000s sedan that either one could have just bought on his own, checkbook in hand.
Dawson Rutter, the CEO-owner of Commonwealth Worldwide Chauffeured Transportation in Boston, and George Jacobs, CEO-owner of Windy City Limousine & Bus in Chicago, finally settled on giving $72,000 each for the car. The vehicle donor, Ford/Lincoln Limousine & Livery Vehicles, came up with a second car so each CEO would get one. When the tab was settled, the auction beneficiary, the NLA Harold Memorial Berkman Fund, netted a record $100,000, while $44,000 funded the second vehicle.
At one point during the dinner gala bidding, held during LCT-NLA Show East in Atlantic City, N.J., the sparring CEOs threw out $2,500 raises on each other as other bidders fell by the wayside.
Rutter recalled how at one industry auction about 15 years ago a bidding session for an auction item stalled at $3,400. So Jacobs waved a $100 bill to keep interest going. Once bids resumed, the auctioneer returned the $100 bill to Jacobs, who didn’t want it back and instead bid it out on behalf of the auction. Rutter bought the $100 bill for $1,000.
So how did these two chauffeured transportation leaders, who trace their industry lineage to the founding era of the mid-1980s when LCT and the NLA started, get so carefree about donating to charity? Their charitable efforts provide some guidelines for operators who seek the most joyful investments of all.
Jacobs and Rutter say their philanthropy grants a satisfaction that goes beyond any bottom line ROI. Most of their donations consist of money and chauffeured transportation.
“I didn’t have a particular motive,” Jacobs says of his years of philanthropy, “other than just a desire to give back.”
“It makes you feel good when you are doing something good for others,” Jacobs says. “Everything I have I got from the limousine industry. I like to give it away; sometimes it’s dollars, transportation, or advice, or sometimes it’s speaking and giving incentives to people. The letters we get from Make-A-Wish kids who draw pictures and take photos when they ride in a limo gives me joy. To them it’s everything. In some cases, it’s their final request.”
“One thing I really felt great about is donating to cystic fibrosis for 25 years,” Rutter said. “There have been major breakthroughs and they are on the verge of curing a significant part of the fibrosis population. When you’re giving money for many years and seeing no result, and then see progress, that is very gratifying.”
Sometimes charity donations can involve showing up at activities such as golf tournaments and fishing derbies. At one event, Rutter bought a few golf balls bid up to $5,000.
Forming A Habit
Jacobs and Rutter say once a company finds a financial rhythm for donations, it should become a budget item. The amount can still vary depending on revenue and economic conditions. “When we have a soft year, I drop the amount of donated service; in a good year it goes back up,” Rutter says.
During the last recession, Jacobs had to cut salaries at his company 10% and reduce charitable donations, but the company never laid anyone off and kept giving as it could. “You try to plan ahead and make it part of your expenses,” Jacobs says. “You do the most you can do; sometimes you don’t have the best year ever. You always let them know you’re there and you always do something.”
Like any business line item, organized donations require review and evaluation. Donors often learn by doing. To select charities, Jacobs and Rutter follow two approaches:
1. Check out recommendations from clients and employees. “I like to get input from other people and see the best use of funds to do the most good and cover the greatest number of people,” Jacobs says.
2. Rutter suggests using charity scorecard websites online that can tell you if a charity misuses funds or doesn’t run efficiently. “Some of them donate very little to the actual cause and most of the money is eaten up by administration and to support salaries,” he says.
While both companies give generously, they do not designate a position to handle donations. Rutter makes all decisions on charity. Jacobs and senior managers choose where to disburse funds. Jacobs advises not to allow sales staff to determine giveaways because “they think they can sell more if they give more.”
Personal Connections
Some causes are obvious good fits for the limousine industry, such as the NLA’s Harold Berkman Memorial Fund that sends money to a group of charities, and the Make-A-Wish Foundation that uses free limousine rides for children. Otherwise, operators should choose donors based on success and a high pass-through of funds to recipients, Rutter says.
Worthy causes also can reflect the interests and motives of the owner. “A lot of charities suit my own wishes and desires,” Rutter says. “With the Lupus foundation, it almost all goes to the patients. I donate to Alzheimer’s because by the time I get older, I’d like to see less risk for getting the condition. I’ve had animals my whole life, so I donate to the Massachusetts Society for the Prevention of Cruelty to Animals. I had a heart issue, heart arrhythmia, so I put in $50,000 for a heart charity. I’m with a group of men a friend put together and we all pledged $50,000 each to Brigham and Women’s Hospital’s cardiac center and cardiologist research.”
“The Berkman Fund has no fees or salaries and makes perfect sense because it’s a good central location,” adds Jacobs, who helped start the fund named after the late founder and owner of Los Angeles-based Music Express, Harold Berkman.
As with any business-related venture, not all charitable efforts necessarily work for the best. “We do not donate to auctions anymore,” Rutter says. “The reason is when people buy [your service] at an auction, they think they own the car. It’s based on availability, but we had so many problems with people arguing and complaining to us about the free service. No more. People abused us on one-off donations. Now we’ll donate $200 instead of a car.”
For the same reason, Commonwealth does not offer rides for weddings or proms. “Too many complaining brides and we don’t have limos anymore,” Rutter says. “We don’t do proms or retail work, so we don’t get people throwing up in the back of limos. No more brides complaining dirt got on their dress from my car.”
Let Publicity Find You
While media exposure on charitable activities can yield new clients and positive word-of-mouth, the CEOs eschew those motives. “You don’t do it with that mind, but it’s a nice thing when that happens and it comes back to you,” Jacobs says.
“I don’t look for publicity,” Rutter says. “I used to go to charity golf events and donate items back to be auctioned off. It’s a lot of fun just giving away money to the right people.”
Inspiring Employees
Another benefit for a business with a charity program is it sets an example for employees. At Commonwealth, employees participate in a YMCA Christmas gift giveaway for children in underprivileged neighborhoods. “They are happy to be part of what we’re doing as a company,” Rutter says. Adds Jacobs: “What our company does is if a chauffeur or employee falls on hard times, has a death in the family, or a setback, employees raise funds. I match the employees by a set amount and it creates great camaraderie.
Tax Write Offs?
Rutter advises keeping accurate records for tax returns. The mention of taxes spurs a pet peeve for Jacobs: “Everything you do in business — payroll, rent, gas, etc. is an expense. It’s income minus expenses. Charitable expenses are no different. You give because you want to give, not because it’s a tax deduction. Every expense is a tax deduction in a way.”
After the blowout auction in Atlantic City, Jacobs and Rutter plan to ratchet up their efforts.
“We have all this year to figure out how to top ourselves,” Rutter said. “We’re starting to have a germ of an idea: Team Dawson and Team George. Maybe we raise $10,000 from each of 10 people. . .” he says, thinking out loud.
Such an idea could yield another high-stakes stalemate.
But then, who cares if Rutter or Jacobs gives more? The benefits always ensure the most winners.
Keywords
charity Commonwealth Worldwide Chauffeured Transportation Craig Hall Dawson Rutter Ford George Jacobs industry charity LCT-NLA Show East Lincoln Limousine & Livery Vehicles Lincoln-Continental National Limousine Association vehicle auctions Windy City Limousine
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