July 25, 2001
United Way astray
United Way of Tucson and Southern Arizona has done its utmost to put its best foot forward, portraying itself as a highly successful dispenser of charity money. In so doing, however, it has misled contributors to the point of deceit. The failure to disclose these practices must stop. But that alone will not rectify United Way's problems. The resentment toward United Way is so deep-seated that the best remedy - perhaps the only remedy - is to replace its management.
The Star's three-day series on United Way by reporter Carol Ann Alaimo revealed that in two of the past three years, the agency overstated its donations to charities by $1.9 million.
Last year, United Way included in its campaign receipts nearly $1 million that was actually raised by a California company; that money was spent in California. The three-month investigation also disclosed United Way's practice of making deals with donors, charging no administration fees for large donors. The administrative fee is widely publicized by United Way as 13 percent. Some donors, it would appear, are more equal than others.
The investigation also found that United Way did not follow some charitable business practices. But perhaps most shocking, United Way's annual report last year listed its contributions to local agencies, but never listed the out-of-state contributions made. That is an unconscionable deception.
United Way President Ed Parker said the out-of-town contributions resulted from more donors designating out-of-town charities. Other United Way agencies, however, do not permit donors to designate out-of-town or out-of-state recipients; others impose restrictions. Last year, however, United Way of Tucson and Southern Arizona funneled $7,239 to the NRA Foundation. Certainly acting as a go-between for the National Rifle Association is not part of United Way's mission of building a better community.
By accepting and including donations to out-of-town donations in its total revenue and not listing those donations in its annual report, United Way of Tucson created an illusion. This is the illusion of a successful agency devoted to the community's well being. It also cast the agency's management in a similar light, celebrating record-breaking donation numbers when in fact the charity pie is shrinking.
As a result,United Way member charities have grown to mistrust the local parent, some choosing to form their own fund-raising drives.
The heads of member charities in a May 30 letter to United Way's board said there "is a serious lack of honest communication between United Way staff" and the charities. "There is a growing distrust," the letter said, "of United Way by member agency executives, their boards and the community at large."
The discontent is understandable. Last year, 43 member agencies received less money than the year before; 26 agencies received more. One charity deposited $30,000 of its money with United Way. Its total contribution from the parent amounted to $32,500 - in fact only a $2,500 contribution, but United Way listed the full amount as its donation. This may not amount to cooking the books, but it is deceptive nonetheless.
The United Way board has established a special committee to review agency problems. Incoming campaign chairman and board member Rick Myers compares United Way's relationship with its member charities to a dysfunctional family. Nonetheless, he says he hopes to "be part of the process of healing." Moreover, he says: "I don't think there's anything broken here that can't be fixed with good people working together."
Myers' optimism that the dysfunctional family can be repaired seems misplaced. Much - if not all - of the member charities' resentment and frustration is aimed at Parker, who has headed United Way for about 25 years. Others have pointed out that United Way's problems did not appear overnight. And the distrust and resentment won't disappear overnight unless the United Way acquires new management.
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