Benefits can flow both ways at celeb charity galas

The Associated Press, Thursday, October 18, 2012, 6:19am (PDT)

LOS ANGELES (AP) -- The Beverly Hilton's International Ballroom will soon be filled with flowers, chiffon, fine china and crystal stemware for a starry black-tie ball costing couples as much as $20,000 to attend. Guests such as George Clooney, Quincy Jones, Jane Fonda and Magic Johnson will mingle with business and community leaders and maybe bid on the new Mercedes-Benz offered in the silent auction.

And it's all for charity. Or is it? Swanky, star-studded galas like Saturday's 26th Carousel of Hope in Beverly Hills and Alicia Keys' annual Black Ball next month at New York's Hammerstein Ballroom are stalwarts in the world of nonprofits. Yet for many guests, the benefits can far exceed the benevolence.

Such balls have helped raise millions of dollars for nonprofit agencies around the world. But they're much more than philanthropy for the rich and famous. Valuable business opportunities flow right along with the vintage Champagne, including networking, deal-making, image enhancement and, of course, tax deductions.

"As long as people are looking to curry favor with certain people and get on good terms with certain people, these things will still be popular," said Daniel Borochoff, president of CharityWatch, a nonprofit charity watchdog group.

But he adds, "There are also altruistic people who want to help the cause, as well."

Barbara Davis, the 82-year-old chairwoman and host of Carousel of Hope, considers herself in the latter group. She started the Children's Diabetes Foundation in 1977 when her daughter, Dana, was diagnosed with the disease.

When Davis broke the news of their daughter's condition to her husband, the late oil and entertainment tycoon Marvin Davis, "he said, `Take care of it,'" she recalled. So she started raising money and held the first Carousel of Hope event in 1978 in Denver.

The couple opened the Barbara Davis Center for Childhood Diabetes in Colorado in 1980. The following year, Marvin Davis bought 20th Century Fox, and the Carousel Ball's guest list grew to include Hollywood royalty and two U.S. presidents.

"It's very good to have a film studio: Everybody came," Mrs. Davis said. "Even though it was still in Denver that year, we must have had six or eight planes of stars."

Since then, performers at the gala have included Sinatra, Sammy Davis Jr., Beyoncé, Elton John, Whitney Houston, Michael Jackson, Paul McCartney and Stevie Wonder. This year, it's Neil Diamond.

So far, the gala has raised more than $75 million for the Children's Diabetes Foundation and its treatment center in Colorado.

While the budget for Saturday's gala is private, "everything is donated that can be donated," Davis said. Superstar performers give their time, and companies like Chanel and American Airlines contribute auction prizes. The Beverly Hilton even donates the space.

This year, guests pay from $2,000 to $20,000 to attend as a couple; tables of 10 cost $10,000 to $100,000. About 1,200 people are expected at Saturday's soiree.

That's a lot of schmoozing and fundraising — and write-offs.

The fair-market value of the ticket is $500, so couples attending at the lowest price point can deduct $1,000 as a charitable donation, said David Wheeler Newman, a Los Angeles tax attorney who specializes in nonprofits.

Ads in the Carousel of Hope's souvenir tribute book range from $750 to $12,500 and are almost always a write-off for the businesses and individuals who contribute, whether as a charitable donation or a business expense, Newman said.

Who's motivated to give and why they do it can be complicated, said Newman, "especially in concentrated urban areas like LA or New York or Chicago, because of the relationship networks that people have."

"There's a big overlap between cultural and business and charitable networks," the attorney said. "You'd need to be a sociologist or archaeologist to graph out these relationships."

There could be unseen benefits for the celebrities, business leaders and companies that contribute to charity events, notes Newman. The entertainer who offers to perform at a gala could do so, in part, to gain favor with the organizer's spouse, with whom he does business. Or a Hollywood agent may support a studio head's charity, then later ask for an audition for an actor he represents.

"A lot of these charities hire celebrities to endorse them," said Borochoff. "And they can hide it."

Businesses and individuals can also boost their own images by aligning with charitable efforts. Angelina Jolie went from wild child to global do-gooder by lending her support and her famous name to humanitarian causes, notes Dorie Clark, a marketing and branding consultant. And celebrities might join forces with charities to "give the media something to talk about ... rather than gossip about their love life," she said.

Another reason celebrities like associating with nonprofit groups aiming to better the world?

"It's a way for them to prove they're smart and they're serious in an industry known for its vapidity," Clark said.

Companies that support charity galas by shelling out for expensive tables can appear to be good corporate citizens, she said, and it also allows their executives to mix and mingle with celebrities and other influential trendsetters.

"The networking benefits are great and the publicity benefits are great," she said.

The charities need the stars, too, both for publicity and brand association.

"Celebrities can grab attention like nobody else," said Tim Saunders, features editor at LooktotheStars.org, a website that chronicles celebrity charity news. "If you have a celebrity attached to your gala, you have instant publicity."

There's also the cool factor.

"Celebrity is a tremendously powerful force," Clark said. "Everybody wants to say, `Oh, I met George Clooney.' For the rest of your life, you get to tell a story that makes you look cool at cocktail parties."

But coolness aside, there's no question elite charity events do serious good. Elton John, for instance, has raised $125 million for his AIDS foundation through his various galas, including his famous Grammy and Oscar parties.

Alicia Keys has helped collect nearly $14 million for Keep A Child Alive, which provides AIDS treatment in India and Africa, with her annual gala. This year's Nov. 1 event will feature Keys and Beyoncé as performers and Oprah Winfrey and singer Angelique Kidjo as honorees. Tickets cost $5,000.

Most stars who participate in high-profile charity affairs are driven by a desire to give, but the ancillary benefits don't hurt either, says CharityWatch's Borochoff. "A lot of it does have to do with enlightened self-interest as well as the altruistic purpose."

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AP Entertainment Writer Sandy Cohen is on Twitter: www.twitter.com/APSandy.

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Online:

Children's Diabetes Foundation: www.childrensdiabetesfoundation.org

CharityWatch: http://charitywatch.org

http://www.looktothestars.org