United Way Fundraising Rises After Scandal-Induced Plunge
Friday, November 30, 2007
The embattled United Way of the National Capital Area will report today that its fundraising drive collected $35.8 million in the last fiscal year, a 1.7 percent increase from the year before, when it recorded its lowest total in at least a decade.
Although the increase is modest, nonprofit leaders said it is a sign of restored trust in the organization, which has been battered by financial and management scandals. Donations to the area United Way exceeded $90 million six years ago but plummeted the following year. The group's leaders said they are slowly drawing back employers that had abandoned their annual campaigns.
"Winning back trust is one person at a time and one firm at a time," said Charles W. Anderson, the local United Way's president and chief executive. "At a certain point, my theory is that you hit a critical point, you hit a critical mass of organizational turnaround, and we are there. . . . The momentum is there. Hopefully many of those people who left and are waiting on the sidelines and will return."
About 67,000 people contributed to the campaign in fiscal 2006-07, according to audited figures that will be released today. Contributions from private-sector employees, a key indicator of corporate support, grew by about 5 percent, from $19.6 million to $20.6 million.
The donations collected in the annual workplace fundraising drive are being distributed to about 895 accredited nonprofit agencies.
Early figures from this year's campaign show that the United Way is in a good position to meet its fundraising goal of $40 million, Anderson said.
Nationally, the United Way's 1,293 local affiliates reported receipts of about $4.07 billion for the 2006-07 campaign, a 2.3 percent increase from the year before, said Rick Belous, vice president of research at the national headquarters in Alexandria.
The United Way is the funding lifeline for many charities. For example, the Children's Hospital Foundation used the $469,522 it received to buy thermometers and tongue depressors as well as to fund its medical program.
"We rely on these dollars to be able to keep our doors open," said Heather Terry, the hospital foundation's fundraising manager.
The local United Way was rocked in the early part of the decade after its former chief executive, Oral Suer, was accused of stealing as much as $1.5 million from the organization during the 27 years he worked there. Other executives were accused of cheating the organization out of hundreds of thousands of dollars. Internal audits and Washington Post investigations also uncovered questionable spending by top leaders and bloated overhead costs. Suer served two years in prison before being released in 2006.
Amid the scandal, many corporations pulled out of the fundraising drives. The United Way also lost its contract to run the Combined Federal Campaign, the fundraising drive among federal government employees, which had been raising about $50 million a year. The United Way has not won back the CFC account, though it raised about $15.2 million from federal employees last year.
Anderson was recruited to restore the United Way's fundraising prowess and salvage its reputation. He and other leaders of the organization came under fire after they projected a fundraising total of $39 million for the 2004-05 campaign but a later audit found that the total was $38.1 million. The organization no longer releases projections and does not announce fundraising totals until the receipts have been audited.
Leaders throughout the nonprofit sector said they think the local United Way has turned a corner.
"Everybody, particularly from the nonprofit point of view, was afraid that it would take years and years and years, if credibility could ever return," said Betsy Johnson, executive director of the Center for Nonprofit Advancement.
Edward J. Orzechowski, president and chief executive of the Catholic Charities of the Archdiocese of Washington, said: "I think the credibility and community confidence of United Way is coming back."
"I'm really convinced that yesterday's story is long since done," said Barry LeNoir, president of the District-based United Black Fund. "They've got a great team over there, great leadership, great integrity. They've taken the story forward, they're transparent, there's nothing hidden with what they're doing and we're very impressed. We're very much convinced that they've got the right track."