Go to shopgoodwill.com and look in the craft section. People are selling bundles of misc. yarn at very affordable prices. Lots cheaper than you will find in the retail stores.
Try yarn stores and department stores. If u explain what you are using it for, most will offer at least some. You might try and see if your local radio or TV stations (I mean public access TV or course) would let you come on to explain your need and more about your group. Call up your local paper and ask if they offer free 12 word ads for charity.
Supermarket throwaways also will give a small amount of space I'm sure. Posters on public bulletin boards like supermarkets, churches and libraries (in all cases ask first. Also major yarn makers like Bernat and Lion may help you if you send them a letter outlining your groups need and objectives and what the items will go for.
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Where Can I Get Free Yarn for Charity Projects?