Charity’s middlemen

Buying a used car is often a game of risk. The buyers put down their money without assurances that they can get the money back if they are unsatisfied. They never really know where the car has been or what kinds of problems may occur with it in the future. It’s a hazardous venture at best.

That is exactly what Juanita Whitehurst was worrying about in March when she was looking to buy a used car. And for someone like her, with a 5-month-old baby and a spinal disease that confines her income to SSI checks, wasting money was not something she could afford. So when she saw a blue 1987 Pontiac Fiero parked on Watt Avenue with a “For Sale” sign in the window, it was with some trepidation that she took down the phone number.

She made contact over the phone with a guy named Rob, who gave no last name but said he owned a tattoo shop in Rio Linda. In discussing the car, she said Rob at first led her to believe that it was his personal vehicle and that he was selling it because it was too small for him. He was asking $995, but she told him she only had $700 to spend. He said maybe they could work something out.

She met with Rob at a warehouse/garage facility in Rio Linda that was full of old cars. It turned out to be a business called Nor-Cal Enterprises, a for-profit company that handles the donation and sale of vehicles for the nonprofit United Cerebral Palsy of Greater Sacramento. On the paperwork she saw that the car was not Rob’s, but had been donated to United Cerebral Palsy. Whitehurst knew she was buying the car “as is,” but claims that Rob assured her the car was in good condition. They agreed she would pay $800 and make up the difference by purchasing two tattoos from Rob (who could not be reached for comment).

Perhaps certain questions should have crossed Whitehurst’s mind and should have been asked: Exactly whose car was it? If it was a donated vehicle being sold for United Cerebral Palsy, how did the cost of the tattoos go to help the charity? But she was in dire need of a vehicle and this seemed like one she could afford. So, not worrying about the details, she said she turned over $800 cash and took the car, agreeing to get the tattoos at a later date. Whitehurst put in a new battery, checked the oil, and saw no immediate problems.

The Fiero had previously belonged to Mark and Joanna Springer, who saw an ad about donating your car to help United Cerebral Palsy and getting a tax write-off. A friend of their child’s is afflicted with cerebral palsy, and so they figured donating to UCP would be a good way to unload their unwanted vehicle while supporting services that their son’s friend, and others like him, might use.

A business owner from Orangevale, Mark Springer did his own automobile mechanical work. Springer said that the Fiero had a missing head bolt when he donated it last February. A car motor has several head bolts that keep the top of the engine on and all of them need to be secured for the engine to run properly.

“Anyone driving it would’ve known immediately,” Springer said, describing his car’s engine problems. “The [warning] lights came on and everything.” It did run, but would overheat before he could drive it around the block. When the car was picked up it had to be towed away. Springer is sure that major work needed to be done on the car before it could be sold.

It’s unclear how much work was done on the car, because the owner of Nor-Cal Enterprises has refused to speak with SN&R, despite numerous phone calls, e-mails and a visit to the Rio Linda garage. But whether or not work on the engine was done, what happened next indicates that the car had mechanical problems after it was purchased by Whitehurst.

Three days after she bought the Fiero, Whitehurst was on Highway 20 on her way to Ukiah. She said the engine began making noises and then caught on fire. Alone with her baby on an empty road, she could do nothing but pour chocolate milk over the flames and then walk into Clearlake for help. A few days later she went back to Nor-Cal Enterprises seeking compensation.

Like many nonprofits, United Cerebral Palsy does valuable work. The organization helps both children and adults with physical and mental disabilities by providing day programs, independent living programs and numerous other services. They have had a vehicle donation program for two years to help defray costs.

Brenda Frasier, UCP’s director of development and programming, says their vehicle donation program came about when the charity was approached by Steve Cheek, owner of Nor-Cal Enterprises, who offered to handle the entire donation program and give UCP 55 percent of the proceeds.

The charity’s expected income from the vehicle donation program for this year is between $85,000 and $100,000, and while that is a small percentage of what the organization takes in every year, it is nonetheless significant and keeps a selection of their services running.

“For us it’s a huge money-making venture,” said Frasier.

But Frasier also said that UCP has little oversight of Nor-Cal Enterprises in terms of the actual business of receiving and selling the cars. All she sees is a monthly list of cars donated and sold and the dollar amounts they sold for.

Frasier said that although she’d never heard of Rob, who sold the car for cash and tattoo business, she’s never had any problems with Nor-Cal or Cheek in the two years they’ve been working together. “I like him,” she said of Cheek. “He’s an honest individual. He’s always been above the board.”

Whitehurst had a different view of her interaction with Nor-Cal and Cheek.

She said she called Nor-Cal Enterprises to complain about the car soon after it broke down. She reached Cheek and said he informed her that she had bought the car “as is,” rightly insisting that he had no obligation to do anything in the way of compensation.

Eventually Whitehurst contacted the Springers, who told her that upon donating the car, they told someone from Nor-Cal (although, at the time, the Springers were under the impression that they were dealing strictly with UCP) that it had a missing head bolt and needed major work.

Whitehurst then demanded compensation from Nor-Cal Enterprises, but Cheek, she said, repeatedly denied responsibility for the car. Whitehurst said she informed Cheek that she had taken her story to SN&R. Then Cheek began to relent by agreeing, Whitehurst said, to give her $400 if she signed a paper saying she wouldn’t talk further to the press. Whitehurst gave one last call to SN&R to relate what had happened and then stopped communication.

Cheek could not be reached despite repeated attempts at getting Nor-Cal’s side of the story. Numerous messages were left for him at both Nor-Cal Enterprises and United Cerebral Palsy.

Darrel Watters, a mechanic who also answers phones at Nor-Cal, did volunteer some information, but what he said was at times conflicting. At first he spoke of his boss, Steve Cheek, as rarely being around the business and not having much to do with it. Then, during a subsequent phone conversation, Watters said that in fact, as of June 1, Cheek no longer owned the company, having sold it to Watters’ brother, and that in the sale of the business the paperwork pertaining to the sale of the Fiero had been lost. But at a later date, Watters again referred to his “boss” Steve Cheek, as if Cheek still owned the company.

Brenda Frasier at UCP, upon being informed that Cheek may have sold the company, said she had heard nothing about it. In fact, she was still receiving money from Cheek. Just before this story went to press, however, Frasier did find out that Watters’ brother Gabriel was reportedly in the process of buying Nor-Cal Enterprises.

It could never be determined what condition the Fiero was in when sold to Whitehurst. Perhaps the more intriguing issue is how the for-profit Nor-Cal operates and how much it discloses about the company at the time of sale.

It is common for nonprofits to work with for-profit companies in order to raise money through donated vehicles. However, as is the case with UCP and Nor-Cal Enterprises, the nonprofits often do little to oversee the practices of their for-profit associates.

As Barry Goggin, president and general manager of Sacramento’s Better Business Bureau, said, “Charity organizations are happy to receive money and not worry about the details.”

Donors should know that they could be dealing with a middleman who needs to cover costs and that the entire value of the donated vehicle is not going to the charity. Indeed, Mark Springer was unaware of Nor-Cal Enterprises when he donated the car. He was under the impression that he was dealing strictly with United Cerebral Palsy.

The office of charitable trusts, within the state attorney general’s office, is one place Springer could have gone for information. For- profit companies that raise funds for nonprofits must file annual reports with the office detailing money earned and given to the charity. All of this information is available on their Web site (www.caag.state.ca.us) along with other useful information about what a donor should expect when giving to a nonprofit. For example, many ad campaigns for vehicle donations claim to offer the “maximum tax donation,” when in fact the amount of the write-off is determined by the Internal Revenue Service and the Franchise Tax Board.

As for buying a donated car, well, it’s just like buying any other used car: you may not get what you bargained for, even when you’re dealing with a worthy nonprofit. Because, as Goggin said, they’re more than happy to take the much-needed money and not worry about the details.