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US Efforts to Fund Russian LGBT Groups Costly, Limited in Impact

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An American Apparel store on Eighth Avenue in Chelsea. | GAY CITY NEWS
An American Apparel store on Eighth Avenue in Chelsea. | GAY CITY NEWS

BY DUNCAN OSBORNE | Given the recent bankruptcy announcement by American Apparel, two gay groups have responded to questions regarding the outcome of efforts between them and the clothing retailer to raise money for LGBT groups in Russia that were silenced when that country enacted a law banning pro-LGBT advocacy in 2013.

In December 2013, Athlete Ally and All Out announced that they were partnering with American Apparel to design and sell the Principle 6 clothing line, saying, “The majority of the proceeds from the sale of clothing will go to support the Principle 6 campaign and directly to lesbian, gay, bi and trans (LGBT) advocacy groups in Russia fighting discrimination and anti-gay laws,” the three organizations said in a joint press release.

The 2014 Winter Olympics were held in Sochi, Russia, and Principle 6 was a reference to the International Olympic Committee’s (IOC) charter. That principle in the charter says, “The enjoyment of the rights and freedoms set forth in this Olympic Charter shall be secured without discrimina­tion.” At the time, the charter did not include sexual orientation as a protected class, and the campaign was intended to be a challenge to the IOC to enforce its own values. The IOC incorporated sexual orientation protections into its charter in December 2014.

All Out, Ally Athlete push with American Apparel yielded modest results; Arcus drive showed high overhead

All Out and Athlete Ally, which promoted the Principle 6 clothing line as late as December 2014, were among a coalition of groups that promised to raise funds for Russian LGBT groups. Coalition members agreed that funds would be funneled through the Russia Freedom Fund that is administered by the Arcus Foundation, which funds LGBT causes, though some organizations said they funded some Russian groups separately as well.

According to the 2014 Form 990 that Arcus filed with the Internal Revenue Service, Athlete Ally donated $5,000 to the fund in 2014. All Out is not mentioned in the form.

After Gay City News found that Athlete Ally and All Out were listed as creditors in the American Apparel bankruptcy filing, the newspaper contacted both organizations asking if they were owed any money by American Apparel –– both said they were not –– and how much money the Principle 6 campaign raised and how much was given to the fund. They gave varying and, to a degree, conflicting answers.

“The funds were dispersed to All Out and used to cover the costs associated with the Principle 6 campaign and to make direct contributions to the Russia Freedom Fund (via our partner Athlete Ally),” Andre Banks, the former executive director at All Out, wrote in an email. “In addition, All Out ran several other fundraisers that year giving an additional $50,000+ directly to Russian LGBT orgs providing advocacy support and direct services to affected members of the community.”

Out Athlete’s Hudson Taylor. | OUTATHLETE.ORG
Out Athlete’s Hudson Taylor. | OUTATHLETE.ORG

Hudson Taylor, the executive director at Athlete Ally, wrote, “I think we were able to contribute about $30k split between the Russia LGBT Sports Federation, Russia Freedom Fund, and another Russian organization that All Out worked directly with.”

The fund and the response by US-based LGBT and rights groups to the Russian government attacks on LGBT Russians and organizations were hastily organized in the fall of 2013 with the coalition operating with a great sense of urgency as it looked like circumstances for LGBT Russians were growing increasingly dangerous. Additionally, the Olympics, which took place in February 2014, were seen as an opportunity to get the world to focus on the human rights violations against LGBT Russians.

Between August of 2013 and July of 2014, the fund raised $347, 504, but spent “just over $390,000” on “consultant and professional services” that were “directly or indirectly related to efforts to raise money” for the fund, according to a report that Arcus commissioned on the fund’s first year of operation. Roughly $200,000 came from individual donors and $140,000 was contributed by the Human Rights Campaign (HRC), the nation’s largest LGBT rights group. HRC noted that it spent substantial resources to raise that cash in what the report called a “t-shirt fundraising campaign.”

The Form 990, which included the full 2014 results, reported that the fund distributed $364,100 for “legal empowerment of underserved communities in Russia” and, in the filing, Arcus committed to spend $296,527 on that cause in 2015. While all the funds raised were distributed, it cost Arcus just under $1.2 million to raise and hand out that cash. (In a subsequent public disclosure, Arcus reported that, as of November 20, 2015, the Russia Freedom Fund had awarded 38 grants totaling $1,278,215, though no updated figure on the cost of raising and distributing that money was available.) Generally, a low percentage of every dollar raised should cover the cost of fundraising.

“Twelve to 18 percent is an average, an average operation,” said Linda C. Hartley, the president of Hartley Consulting, which aids non-profits in fundraising. “There are lots of exceptions…That’s why the Better Business Bureau has to up to 35 or 40 percent.”

The Arcus report noted that some aspects of the work were disappointing. While “celebrity engagement,” which was expensive, brought visibility to the issue, the “return on investment –– at least in the short term –– was viewed by most as meager,” the report said.

“It was hard for those interviewed to articulate concrete outcomes that resulted from celebrity engagement work beyond general expressions of solidarity,” the report said. “Some interviewees expressed general skepticism with the theory that celebrities can drive people to take action (i.e., donating to a cause or otherwise being active in a campaign).”

Gaining support from Olympic athletes and sponsors was also seen as only moderately successful.

“A number of interviewees also noted that even if the ultimate response at Sochi among athletes, corporate sponsors, etc., was less strong than some people had hoped for, the mobilization, awareness raising and social media campaigns supported through Arcus and its partners’ efforts contributed to more international scrutiny and attention to the Russian government’s repressive practices than might otherwise have been the case,” the report said.

Updated 5:17 pm, July 20, 2018
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