Charities Lament 'Cash For Clunkers' Program When Congress passed a new law to give people up to $4,500 to junk their old cars and buy new, more efficient ones, the auto industry cheered. But some charities say they'll be the unintended victims of this program, and so will the low-income people they try to help.
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Charities Lament 'Cash For Clunkers' Program

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Charities Lament 'Cash For Clunkers' Program

Charities Lament 'Cash For Clunkers' Program

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If you want to buy a new car and you have an old one to get rid of, you might be thinking about the government's new cash for clunkers program. You can get as much as $4,500 for that old car - could be a great deal.

But as NPR's Elizabeth Shogren reports, some charities say that the law will hurt them and the low-income people they try to help.

ELIZABETH SHOGREN: Emma Johnston needs a car to shuttle her three kids to school and day care around Alexandria, Virginia. She also drives almost 40 miles to get to a part-time job and another 40 miles to paralegal classes.

Ms. EMMA JOHNSTON: My vehicle just went completely dead. Everything went bad. It was an older car. It was a 1991 Toyota Camry.

SHOGREN: She's been renting a car for $200 a week, but she can't afford to keep that up. Someone at her church told her about Roger Penn's charity, the Car Ministry. It fixes up donated cars and gives them to people in need.

Mr. ROGER PENN (President, Car Ministry): The vehicle we have is newer than the one you had. It's a '95 Oldsmobile Ciera, and it's in pretty good shape and it seems to drive well.

(Soundbite of car starting)

SHOGREN: As she drives away, Penn worries that the cash for clunkers program will make matches like this one a lot harder to make.

Mr. PENN: This is kind of a typical car that would perhaps be junked under this cash for clunkers law, but look at it - it's really a nice car. It drives well. Why wouldn't somebody benefit from that?

SHOGREN: The cash for clunkers law goes into effect later this month. It will give people $3,500 to scrap gas guzzlers and buy new cars that go at least four miles further on a gallon of gas, or $4,500 if their new vehicles get 10 miles more per gallon.

Mr. PENN: Maybe the new cars will get better mileage, but what about the people who can't afford to buy a new car? They need transportation, and if they don't have it, they won't be able to get to work, they won't be able to get the medical help that they need because they can't get to dialysis.

Representative BETTY SUTTON (Democrat, Ohio): Certainly that's not the goal of the act.

SHOGREN: That's Democratic representative Betty Sutton of Ohio, one of the program's chief sponsors.

Rep. SUTTON: The act, of course, is to help consumers help our environment and to stimulate auto sales at this time when they're lagging and so many families across this country depend upon them for putting food on the table and keeping them employed.

SHOGREN: Sutton says, in part because of charities' concerns, Congress restricted the program to cars that get 18 miles per gallon or less.

Rep. SUTTON: Actually, it severely cut down the number of cars that might be traded in under the cash for clunkers program and thereby making all of those cars still available for charitable donations.

SHOGREN: Still, charities say there's no question that the cash for clunkers program will put a strain on them. Usually when someone donates a car to charity, the charity sells it and keeps the proceeds.

Pete Palmer runs the Vehicle Donation Processing Center.

Mr. PETE PALMER (Vehicle Donation Processing Center): There's a whole industry that helps support the charities, including the auctions, tow truck drivers and all of those people are going to be hurt.

SHOGREN: Palmer's company handles sales of donated cars. Donors can take tax deductions for the small amount charities usually get for those sales.

Mr. PALMER: Somebody has to be pretty darn altruistic to do a car donation over the cash for clunkers program if they want the new car.

SHOGREN: Palmer's company and some charities are lobbying against an effort to extend cash for clunkers beyond November 1st, when it's supposed to expire.

Elizabeth Shogren, NPR News, Washington.

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