Some of the nation's most prominent politicians, entertainers and business executives have been donating thousands of dollars each year to an organization that provides scholarships to underprivileged young people. But little of the money has been used for that purpose.
From 1985 through 1987 - the latest period for which tax records are available - $2.1 million was raised by the Horatio Alger Association of Distinguished Americans Inc., an organization that purports to provide college scholarships to high school students from around the country.The organization, based in Alexandria, Va., spent $1.7 million during those three years. Only $315,000 went to scholarships - $5,000 grants to 63 students.
Most of the association's outlays went to executive salaries, office expenses, books devoted largely to laudatory stories of the members' lives, annual banquets at places such as New York's Waldorf Astoria Hotel and contracts with a New York public relations firm.
The membership roster of the organization, consisting of people nominated for the Horatio Alger Award by current members, reads like a Who's Who in politics, business and entertainment.
Among its approximately 250 members are President Reagan, former President Ford and New York Gov. Mario Cuomo.
The association's diverse membership also includes H. Ross Perot, president of Perot Systems Corp.; Allen Neuharth, chairman and chief executive officer of Gannett Co.; Tom Landry, coach of the Dallas Cowboys; entertainers Ed McMahon and Bob Hope; the Rev. Norman Vincent Peale; and evangelist Billy Graham.
The association, which was founded in 1947, was named after Horatio Alger, who in the late 1800s chronicled the adventures of boys who triumphed over adversity to achieve success.
It was based in New York until its headquarters was moved earlier this year to Alexandria, a suburb of Washington, D.C.
Information on the association was obtained from tax forms required to be filed with the Internal Revenue Service by organizations exempt from federal income tax and from annual financial reports submitted by the association to the New York Department of State.
The amount of salary and benefits going to the association's executive director alone, which increased from $98,126 in 1985 to $120,154 in 1987, has exceeded or almost equaled the amount of scholarships awarded in each of the past three years. Those scholarships totaled $100,000 in both 1985 and 1986 and $115,000 in 1987.