Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, August 13, 1995 TAG: 9508140018
SECTION: VIRGINIA PAGE: C1 EDITION: METRO
SOURCE: LESLIE TAYLOR STAFF WRITER
DATELINE: LENGTH: Long
Decades ago, United Way contributions were placed in the hands of a small, select committee that doled out dollars as it saw fit.
Donors had no say in where their money went, and agencies simply asked United Way to fill gaps in funding they could not raise on their own.
No more. Today, the bulk of contributions sifts through the hands of nearly 100 fund distribution volunteers. Donors can direct their dollars to particular agencies - or away from them.
And vying for allocations is a competitive process that requires United Way's 35 partner agencies to account for the dollars they spend and to prove they may need more of them.
From February to June this year, 90 Roanoke Valley volunteers plucked and pecked at every partner agency - those granted the privilege of using the United Way logo - that wanted money.
These fund distribution ``workers'' - most of them mid- to upper-level management or self-employed - put in an estimated 4,000 hours to make sure dollars were allocated equitably.
Their mission was to ensure that agencies were using appropriations correctly. But they also delved into agencies' full operation.
If volunteers thought an agency's service fees were too low, their suggesting a fee increase was not off-limits. (Roanoke Valley Speech & Hearing Center, as a result, increased its fees 16 percent.)
If volunteers wanted to know what impact Planned Parenthood's offering of abortions might have on its operating revenue, they asked. (Minimal, Planned Parenthood told volunteers.)
``We've got to do all we can to make sure our agencies understand the nature of the marketplace, and that it's not enough tomorrow to do what you were doing yesterday,'' said Bob Kulinski, United Way of Roanoke Valley's president and chief professional officer. ``It's a much tougher environment than it's been in the past.''
So tough that agencies will stop at nothing to drive home a bid for dollars.
Alton Knighton, a lawyer who is chairman of Planned Parenthood's board of directors, showed up at one fund-distribution meeting with an ``empathy belly,'' a 12-pound contraption with breasts and the weight equivalent of a full-term fetus strapped to his chest and middle.
``I did it partly as a demonstration of what we do in terms of showing physically how we're working with youth in the community,'' Knighton said. ``And partly to provide a light moment.''
Dissecting dollars
United Way of Roanoke Valley contributions have been steady for three years, surviving even public response to the criminal actions of William Aramony, former chairman of United Way of America.
Allegations of Aramony's spending habits surfaced in 1992, sending affiliates of the nation's biggest charity, including the Roanoke Valley affiliate, into damage control. Roanoke's was the first United Way affiliate in the country to withhold its quarterly national dues. Within a week, United Ways across the country had followed suit, and Aramony had stepped down.
Aramony was convicted in April of stealing nearly $600,000 from United Way and lavishing it on young women, some only in their teens. In June, he was sentenced to seven years in federal prison.
Throughout, United Way of Roanoke Valley tried to temper national controversy by steering attention to the fact that money people give here, stays here.
Contributions come to United Way of Roanoke Valley mainly through the traditional annual campaign conducted among community employers. In 1994, the campaign raised all but $1 million of the $4.8 million total.
Of that total, about $600,000 was in contributions that donors designated to particular groups among the 35 partner agencies and 78 other health and human-service agencies eligible to accept United Way funds.
Contributions designated for United Way's 35 partners agencies are not divulged until after the fund distribution process is completed. This ensures that where donors have chosen to contribute their money does not influence volunteers' decisions.
Of the total campaign, 14 percent was held back for United Way's administrative budget, 6 percent to 10 percent for unpaid pledges, expenses for conducting state and federal employee campaigns, payments to United Way of America and United Way of Virginia, emergency reserves for partner agencies and reserves for future services.
This left $2.9 million for the fund distribution volunteers to parcel out, about $2,500 more than last year.
How it works
Fund-distribution volunteers were divided into 12 committees, with each committee responsible for allocations to two or three agencies.
The committees determined allocations using a high-, medium- and low-priority funding matrix established by the organization 10 years ago.
Though the matrix is ever-changing, current high-priority services include protective services for children and adults, medical care, family preservation, temporary emergency shelter and pregnancy/family planning. Bethany Hall's alcohol and substance abuse program for women and Planned Parenthood's pregnancy and family planning education programs are considered high-priority.
Medium-priority services include rehabilitation for the physically and mentally disabled, disaster relief and housing. Examples include transportation for the Northwest Child Development Center and the LOA-Area Agency on Aging's Meals on Wheels program.
Low-priority services include consumer services, special/supplementary education and recreation, such as American Red Cross' volunteer recruitment and the Mental Health Association's education program.
In addition to a program's ranking, another factor that can determine an agency's allocation is its financial health. The healthier ones run the risk of cuts.
``You don't want to penalize a well-managed and efficient operation for being good,'' Kulinski said. ``But I think an agency that is more self-supported should expect less from United Way. There is no justification for hoarding money, for socking it away for the lean years.''Partner agencies can have as much as a three-month operating reserve. If an agency has more than that, volunteers can ask for an explanation.
If the answer is "Our national office says we gotta do it," attribute? that's sufficient. The Virginia Skyline Girl Scout Council, for example, is required by its national office to target 12-month reserves; the American Red Cross, six months.
"But if the answer is 'We're just raising more money than we spend every year,' then our volunteers can say, 'Well perhaps you don't need quite so much from United Way,'" Kulinski said.
Seven agencies were financially healthy enough to prompt questions about their requests for funding. Four of them - American Red Cross, Association for Retarded Citizens, Boy Scouts and YWCA - received lower allocations this year. Two - Bradley Free Clinic and Girl Scouts - got the same amount as last year. The Children's Home Society received an increase.
Nothing's sacred
United Way does not prohibit volunteers from asking what they want about an agency's operation. There are questions about administrators' salary raises and travel expenses as well as an agency's function.
The Council of Community Services this year had to explain why its board attendance was low and how it intended to improve it. The Mental Health Association had to explain how it calculated volunteer hours.
The United Service Organizations, a partner agency since 1949, was not around to address questions. The USO, which provides services for active military people, made its fund request by letter and did not send a representative to meet with the fund distribution committee. The agency asked for $4,020, double the amount it received last year.
The USO received nothing this year.
Possibly the most scrutinized agency this year, however, was Planned Parenthood of the Blue Ridge. Its announcement in February that it would begin offering first-trimester abortions touched a community nerve. And rumors swirled that United Way was considering yanking its partner-agency status.
Those rumors proved unfounded, as United Way - which funds Planned Parenthood's educational programs aimed at reducing teen pregnancy - stood by the agency.
The fund distribution committee that reviewed Planned Parenthood toured the agency in March. Kathryn Haynie, president of Planned Parenthood's Blue Ridge affiliate, talked to the committee about how its United Way funding - restricted to the educational program - was used.
Volunteers asked Haynie about teen-pregnancy rates and whether its educational programs duplicated those of other agencies. The abortion question was discussed later, at a committee meeting.
``Do we have any idea what impact to revenue that Planned Parenthood's providing abortion services is going to have?'' asked George Anderson, human resources manager for Kroger Co. and chairman of the committee that reviewed Planned Parenthood. ``Positive? Negative? Are they going to use the revenue to subsidize any of its other programs? Indigent clients? Subsidized services? How will it impact the budget?''
Kulinski, who sat in on the discussion, repeated what committee volunteers had heard before:
``There are no sacred cows. Anything can be asked. Because, by golly, it's the community's money we're talking about.''
The question was put to Planned Parenthood administrators and board members at a budget conference with the committee a month later.
``We're not making any money off those services,'' Haynie said. ``We have to figure out how to slightly more than break even.''
Haynie later said she found the process no different this year than in previous years. But she said she is sometimes frustrated by the ``disproportionate attention paid to things that [United Way] doesn't fund.''
``What it does is it reduces attention on how positively we're affecting the community and how we're supported by United Way dollars,'' she said. ``We have really had to work hard to focus committees' attention.''
Planned Parenthood asked for $43,645 this year. It received $42,881, 3 percent more than last year.
``Some of the agencies feel that our exploration ought to be limited to what it is United Way is purchasing for the community,'' Kulinski said. ``But we've never tried to limit the freedom of our volunteer [committee] members to take the discussion where they want to take it.''
Digging deeper
Once the fund distribution committees visit agencies, review financial information and conduct budget conferences - a two- to three-month process - they vote on recommended agency allocations. On May 11, a committee representative ``cabinet'' took those recommendations to a roundtable meeting, something akin to summit negotiations, where representatives tried to force-fit agency requests into a fixed amount of contributions.
Unable to do so within a scheduled four-hour meeting, the cabinet returned 11 days later to complete the process, squeezing $3.2 million in requests into an available $2.9 million through a lot of give and take. Agencies were notified of their allocations and told they had 10 days to file an appeal.
Representatives of four agencies that received less money this year than last, or none at all, appealed. On June 21, they met with the fund distribution cabinet.
Representatives from the Roanoke Valley Speech & Hearing Center wanted an explanation for a nearly 20 percent cut.
Representatives from the American Red Cross, which received the largest allocation of all United Way partner agencies, asked why its allocation was $18,000 lower than last year's.
The Blue Ridge Mountains Boy Scout Council insisted that United Way officials justify dropping its allocation by $8,000 from last year's.
And the USO sent a letter expressing disappointment in receiving no allocation at all.
The cabinet recommended that all four appeals be denied, citing healthy operating reserves in some cases and in others a desire to wean agencies from heavy reliance on United Way funds. On July 11, the board of directors accepted that recommendation.
Bruce Tuten, Boy Scout council executive, said he wished he had known what concerns United Way had about the council's financial condition before appealing the allocation. Newly appointed, Tuten said he was not aware of what had been discussed earlier in the fund distribution process.
The cabinet's biggest concern was what appeared to be very healthy operating reserves.
``But you've got to know how far it came,'' said Tuten, referring to the council's near-bankruptcy six years ago. ``We're just now peeking out from under red ink.''
The drop in United Way funding ``will cost us in services,'' Tuten said. ``That's the equivalent of two Boy Scout troops or three Cub Scout packs.''
Bill Pennell, chairman of the United Way's audit committee, said the Boy Scout council should be applauded for pulling themselves out of a shaky situation and into sound financial standing.
``But they were still generating surpluses, and their net fund balance was over [United Way] guidelines,'' he said. ``We've got to take a look at that and say, `Can they afford not to have $10,000 or $20,000?'''
All over again
Just as money raised in the 1994 campaign began shuttling through an electronic transfer system to agencies' bank accounts, United Way officials were launching the 1995 drive. Last month, plans for the new campaign were announced. This year's goal is a record $5 million.
United Way also is preparing for next year's allocation process - and beyond. This month, a task force is scheduled to begin examining the fund distribution process as part of a possible redesigning of the whole United Way system of funding agency programs.
``They're going to take a look at values, the whole current system and what it needs to look like in the next 10 years,'' Kulinski said. ``It would include a whole area of new program funding, donor choice, continuing outcome evaluations of agency programs.
``All of this will be rolled into one seamless process that we hope can be made responsive and provide the community the best value for their dollars.''
Keywords:
PROFILE
by CNB