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United Way navigates tough times

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Todd Cohen

CHARLOTTE, N.C. — As it kicks off its annual fundraising drive, United Way of Central Carolinas faces big challenges, both in the marketplace and in its own house.

The looming recession is fueling rising demand for health and human services provided by partner agencies United Way funds, while also squeezing the donors it counts on for those funds.

Compounding the economic challenge is turmoil at United Way, with its board finally having ousted Gloria Pace King in the face of growing public concern triggered by disclosures it had given her a huge bonus and retirement supplement.

The King controversy also prompted the resignation of Graham Denton, a retired Bank of America executive, as chair of United Way’s board.

And 25 employers that accounted for $377,000 in giving to last year’s drive have cancelled their workplace campaigns this year.

In the face of those challenges, the fund drive will focus on the big picture, emphasizing the role United Way plays in addressing local needs, says Diane Wright, senior vice president for resource development and regional operations.

“There are a lot of people, probably now more than ever, that will be hurt if the agencies that provide the services aren’t there or can’t provide the services,” she says.

Chaired by Ellen Ruff, president of Duke Energy Carolinas, this year’s drive will not have a monetary goal, an approach it last took it 1994.

In “uncertain economic times,” Wright says, the board “felt we need to be very sensitive to the financial pinch our donors may be feeling.”

Even as the drive begins, United Way already knows it must offset the loss of at least $5 million in contributions that helped last year’s drive raise a record-high $45.3 million but that fell prey this year to the struggling economy, Wright says.

Of the funds last year’s drive raised, $32.7 million were undesignated dollars contributed to United Way’s general “Community Care Fund” that its 91 partner agencies and other local programs count on.

This year, with the recession expected to limit giving among individuals who make more modest contributions as part of workplace campaigns, United Way is counting even more on gifts of $1,000 or more.

Last year, over 7,800 donors contributing $1,000 to $9,999 gave a total of $14.2 million, while over 780 individuals contributing $10,000 more gave a total of $10.1 million.

If donors giving at those levels can increase their giving this year, Wright says, that could help offset any declines from individuals who may not be able to give as much as in the past.

And Duke Energy is providing funds for a “challenge match” to spur individuals to increase their giving to $1,000 or more over three years.

United Way also is making a special effort to recruit companies to participate in the drive for the first time, with every one of United Way’s 70 board members assigned to call two to three new businesses to try to enlist them.

And based on a study last year that identified strategies that cause greater participation in workplace campaigns, United Way this year is putting some of the strategies into place.

The number of employees giving to United Way tends to increase when the CEO attends an employee meeting and encourages employees to give, for example, or
when a United Way employee visits the company’s CEO, or if a company sets a specific goal for its workplace campaign, Wright says.

But the King controversy is dominating the kickoff of the drive.

Based on recommendations from consultants, the executive committee of United Way’s board voted in December 2006 to give King nearly $2 million over three years to supplement her retirement plan to reflect an increase in the percentage of her pay included in her pension, bringing that percentage in line with that of most United Way employees, Wright says.

That decision, disclosed recently in news reports, sparked an outpouring of protest, with the board voting Aug. 26 to fire King if she does not resign by Sept. 30.

It also named Mac Everett, retired head of corporate and community affairs for Wachovia, as interim president at a salary of $20,000 a month for up to four months.

And Denton, retired market president and executive and North Carolina and Charlotte Market president for Bank of America, resigned as chair of the United Way board.

Denton, who had served as board chair since Jan. 1, 2008, said in a Sept. 3 resignation letter to fellow board members that he had become “increasingly aware that many
of you have lost trust and confidence in me as your board chair. Some have even expressed a sense of betrayal by your board leadership.”

He said he hoped his decision to step down, along with other board actions, would represent “the beginnings of a new era for your United Way.”

The board named Carlos Evans, Wachovia executive vice president and wholesale banking executive, as board chair.

Even before decision to oust King, two employers that last year accounted for a total of $75,000 in giving to United Way had scrapped their workplace campaigns this year, a number that now has grown to 25.

“We know that any publicity that’s less than positive is going to have an impact on a donor’s decision,” Wright says. “It is everyone’s hope that donors will put that behind them and focus their efforts on taking care of those in our community who need help.”

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