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Not all "Books for Charity" go to charity

A for-profit book recycler behind a popular donation program at supermarkets like Safeway sells many of the books received.

Kai Ryssdal: Depending on where you live, you might have seen something new in the parking lot at your local grocery store. A big blue bin into which you can put old books as a donation for charity. The bins are in 11 states, from California to Massachusetts.

But the company behind the whole thing turns out to be one of the country's biggest for-profit book recyclers. Claudine LoMonaco has more from Prescott, Ariz.

Claudine LoMonaco: There was no mistaking the message on the large blue bins. They read "Books for Charity" in bright yellow letters five inches tall.

Richard Cady first saw one in this Safeway supermarket parking lot last year. A volunteer with the Prescott Public Library, Cady went over to get a closer look.

Richard Cady: It said something about helping children to read.

But then he read the small print. It said some of the books would be sold to cover expenses.

Cady: I sort of had a bad feeling about it. It didn't seem quite right.

It turns out the bins are owned by a for-profit company called Thrift Recycling Management, or TRM. The company does donate some of the books through a charity it helped create called the Reading Tree. But it also sells the books on places like Amazon.com. Last year, the company brought in $27 million. The Reading Tree's website doesn't mention any of that.

Cady said it felt deceptive.

Cady: The average little old lady who is going grocery shopping at Safeway isn't going to figure this out. She's going to think that those books are going to children, and I don't think that's always the case.

The bins worry Cady because he helps run Prescott Library's used bookshop. It raises thousands of dollars for library programs by selling donated books. Like many Friends of Library groups around the country, Cady worries the bins are siphoning off donations that normally would come to them.

The blue bins have also caught the eye of law enforcement.

Tony Green: We're looking into seeing whether donors were misled in any when they gave books about how much of the proceeds are going to charitable purposes and how much are going to a for-profit company.

That's Tony Green, from the Oregon State Department of Justice. In May, the department began investigating TRM. TRM's chief executive Phil McMullin wouldn't tell me how much of its $27 million in revenue comes from the blue bins. But he said the company donates 25 percent of the books it gets from the bins.

Phil McMullin: Does TRM make money at it? Sure. Are we driving Rolls Royces? No. Are we delighted with the service we're providing? We are.

He said 50 percent of the books they get from the bins are in such bad shape, they get recycled to keep them out of landfills. Tax documents The Reading Tree filed in 2009 show the group donated more than a million books to charities.

McMullin: There's nobody in the whole country who gives a million books a year away for free.

I spoke to nearly all the schools and literacy groups in Arizona that TRM says it aided over the last year, about two dozen. And the donations are for real. Ellen Dean runs Books Pals. She says TRM and The Reading Tree helps her group get thousands of high-quality books to kids at poor schools every year.

Ellen Dean: A lot of these children have no books in their house. They may have the telephone book or a bible but it's not typical that these families have libraries at home, so we help them start that.

McMullin concedes his company needs to refine its message. Thrift Recycling Management has been changing the wording on the bins. The bin in the Prescott Safeway now reads "Donate Books," but it still doesn't say some of the books will be sold for profit.

In Prescott, Ariz., I'm Claudine LoMonaco for Marketplace.

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There have been many unfavorable media reports about TRM and Reading Tree over the last few years (see links in my next comment). The concerns expressed in most of these articles are over the unusually close relationship between for-profit TRM and charity Reading Tree, the potentially misleading wording on the bins, and the negative impact on local book charities such as the Friends of the Library associations across the country. .......................................................................................................................................................... But there’s one point that — to my knowledge — none of the articles have mentioned, and that is the distribution of the DOLLAR VALUE of the books being donated to the “Books for Charity” bins. .....................................................................................................................................................

First, the numbers: TRM says it sells for-profit about 25% of the books donated to the Reading Tree “Books for Charity” bins. I’m guessing that TRM’s portion is comprised of the donated books with the highest resale values. Another portion — about 50% — is said to be damaged, inappropriate or outdated, and is sold as pulp material with the proceeds apparently going to Reading Tree. The remaining 25%, nearly worthless but usable children's books — the kind sold for pennies on Amazon — are offloaded as TRM’s donation to Reading Tree, which in turn distributes these books charitably. .....................................................................................................................................................

Although Reading Tree and TRM may each be taking an equitable 50% of the usable books, such percentages don’t tell the whole story. ............................................................................................................................................................. If it were possible to estimate a theoretical dollar value of the books TRM keeps to sell on Amazon, Ebay and elsewhere and compare that figure to the theoretical dollar value of books TRM donates to Reading Tree, what would we discover? .....................................................................................................................................................

Extrapolating from statistics given in an article on TRM by The Seattle Times (dated January 17, 2011), it appears that TRM sells books for an estimated average unit price of not more than $6.75 ($27 million in revenue divided by 4 million books sold equals $6.75 per book). .......................................................................................................................................................... But what would be the potential resale value of the average book that TRM donates to Reading Tree — $6.75? I seriously doubt it. If Amazon’s website is any indicator, numerous used books for children sell for only a penny; many more list for well under a dollar. .....................................................................................................................................................

Digging deeper, TRM once appeared to claim on its website that since it began in 2004, the company has donated about 10 million books, compared to the 15 million books TRM also claims to have sold since its inception — again, a fairly equitable ratio. .....................................................................................................................................................

However, one may further extrapolate that if TRM has to date sold 15 million books with an average price of $6.75, its gross revenue over six or seven years would be over $100 million. .....................................................................................................................................................

Similarly, if one estimated TRM’s roughly 10 million donated books to have had an average value of, say, 50 cents each — a generous estimate, in my opinion — it would mean that thus far only about $5 million worth of books have been donated by TRM since it started. .....................................................................................................................................................

Even if the donated books were worth FIVE TIMES as much, TRM would still be doing rather well with its “Books for Charity” donation bin set-up. They reap massive PR benefits by giving away millions of children’s books, most of which have little or no monetary value but are still usable. Meanwhile, TRM appears to be raking in tens of millions of dollars annually by selling books obtained from big blue bins that have been labeled “Books for Charity.”
.......................................................................................................................................................... Of course, the above is simply conjecture, and besides, no one seems to know what percentage of the books sold by TRM comes from its own "Books for Charity" bins, and not some other source. However, the Seattle Times article mentioned earlier says that TRM "... relies on a network of contracts with charities, and it obtains books through donation bins carrying those nonprofits' names." Note that it said "charities" — plural — but in two years I haven't been able to find any other charity name on TRM's bins other than Reading Tree. So I'm guessing that a very high percentage of TRM's books come from its own blue bins labeled as Reading Tree.
........................................................................................................................................................ Does all of this seem just a bit deceptive? You be the judge. If you have concerns about TRM and Reading Tree in your community, please consider filing a complaint with your state’s Attorney General Office. .....................................................................................................................................................

Sorry for all the dotted lines; it's the only way I could get this comment box to separate paragraphs. (Media links in my next comment)

News reports about TRM and Reading Tree: .....................................................................................................................................................

●The Kitsap Sun; May 30, 2009: >>>>> http://www.kitsapsun.com/news/2009/may/30/donated-books-becoming-a-sough... .....................................................................................................................................................

●The Kitsap Sun; July 8, 2009: >>>>> http://www.kitsapsun.com/news/2009/jul/08/national-charity-agrees-to-sha... .....................................................................................................................................................

●The SnoValley Star; July 1, 2009: >>>>> http://snovalleystar.com/2009/07/01/local-book-donations-down-this-year .....................................................................................................................................................

●The Seattle Times; January 17, 2011: >>>>> http://seattletimes.nwsource.com/html/businesstechnology/2013949487_trmi... .....................................................................................................................................................

●The Oregonian; May 8, 2011: >>>>> http://www.oregonlive.com/pacific-northwest-news/index.ssf/2011/05/book_... .....................................................................................................................................................

●The Oregonian; May 12, 2011: >>>>> http://www.oregonlive.com/pacific-northwest-news/index.ssf/2011/05/books... .....................................................................................................................................................

●Palo Alto Online; June 17, 2011: >>>>> http://www.paloaltoonline.com/weekly/story_print.php?story_id=15080 .....................................................................................................................................................

●Berkeleyside; June 30, 2011: >>>>> http://www.berkeleyside.com/2011/06/30/charity-book-bins-run-by-for-prof... .....................................................................................................................................................

●California Library Friends Forum: Summer, 2011: >>>>> http://www.cafol.org/forums/viewtopic.php?f=1&t=2&start=10 .....................................................................................................................................................

●The Vancouver Courier; September 2, 2011: >>>>> http://www.vancourier.com/literacy/raiseareader/Donated+Books+Charity+so... .....................................................................................................................................................

●The Vancouver Courier; September 28, 2011: >>>>> http://www.vancourier.com/news/Library+group+sees+sharp+drop+book+donati...

Its sounds like Thrift Recycling Management had a talk with "Marine Bob", who runs Got Books in Massachusetts, as his containers got repainted "Donate Books" a couple of years ago when the State Attourney General shut down is illegal Community Books business. With careful wording, these slimy businessmen get away with it, and local libraries, who used to rely on "Friends" book sales, are starved for donations thanks to them. RESEARCH THESE "CHARITY" BOOK BINS, AND CALL YOUR LOCAL OFFICIALS ON IT.

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