United Way to slash nonprofits' funding, change way it gives - Baltimore Business Journal:

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million from its planned donationsthis year. The organizationh is also cutting about 10 percentt of funds already earmarked for about 40 partner agencies and trimminbg annual contracts with seven larger nonprofits by nearly15 percent. The losses will spreasd to nonprofit agencies in Baltimore City and the surrounding five The impact will be feltby shelters, clinics, youth clubs and some of the area’ds largest charities. The , the and the are just a few of the nonprofitsd that rely on UnitedWay dollars. It’s the latesrt turn in a funding crunch that hascrippled Layoffs, business closures, and stoclk market turmoil have slowex corporate and private giving and erode d endowments.
Those same factorws are sending more unemployed and uninsured people to agenciefor help. “I’ve never seen anything this saidLarry Walton, CEO of Unitedx Way of Central Maryland. “We are goingh to focus the majority of the funding we have on basic needxs like foodand shelter.” The Uniteds Way’s fall campaign netted only $36 million, down from a goal of $40 Giving from Baltimore’s Constellation Energy Group, its largest shrunk this year amid the company’s own financial troublesd and downsizing.
And United Way’s $18 million which provides some supportg for grantsand programs, was halvedr to $9 million as its investments plunged with the In response, United Way slashec $700,000 in its administrative costs. The organization, which employsw 93 people, eliminated seven unfille positions and could be forced to lay off some The organization also has asked agencieds to make annual requests for instead of awardingthem three-yeae allocations. Money designated by donors to specific agencies will not be United Way board members plan to meet April 23 to decided how to award undesignated funds for the fiscal year startingJuly 1. Unitex Way chapters across the countryare suffering.
Estimatee show nearly 58 percent of United Way offices were expecting declinesin campaigns, and abouyt 82 percent said they expect highed rates of uncollected pledges this year becauser of layoffs and business closures, said Sallg Fabens, a spokeswoman for the . Campaigne nationally were expecting to see 2 percenftto 5.6 percent decline this according to January survey of Unitex Way chapters. Fabens said many of the campaigna hadn’t closed by United Way of Central Maryland is especialluy feeling the effect of a drop in itsbiggesg donors. Donors who contribute $10,000 or more becomde members ofthe agency’s prestigious .
Estimates show ther were 380 Tocqueville members raisingabout $5.7 millionb for the 2008 campaign, compared to 465 donors raisinbg $6.2 million in the 2007 campaign. The declind in donations can be traced to how the recession is pummelintthe region’s largest employers. For example, Constellation says its givin g to United Way campaigns nationally fellfrom $5.1 million in 2007 to nearlyu $4.1 million last year. Constellation employeews have been one of the United Way ofCentrap Maryland’s largest donors, giving nearly $3 million a year for the past severall years. The Baltimore energy company didn’t disclose how much its employees gave to the localo campaignlast year.
A bid Sept. 18, by Warren Buffett’s to buy Constellationj saved the company fromnear collapse. But that deal fell througgh in December after Constellatiom accepteda $4.6 billion offer from French power firm for 49.99 percen of its nuclear power arm. Amid the Constellation shed 840 jobs, nearly 8 percent of its globalwork , another big United Way donor, reported a declinw in the number of employees and the amount raised during its United Way of Centrakl Maryland campaign last said Brian Lewbart, a spokesmanb for the Baltimore-based money management firm. He declinerd to disclose the specifics of the but he attributed the declind to the impact of the economyon T.
Rowe’s United Way’s woes add to those already felt byGreater Baltimore’s nonprofits. They already are raiding reserves and cuttingh staff and programs tostay afloat. “I don’t know how we will make up all of the deficits weare facing,” said Carole Alexander, executive director of , a Baltimorse nonprofit that assists victims of domesticc violence. “Some good agencies may not be able to United Way contributions to House of Ruth will be downnearly $74,7000 by June 30, compared to last year’s funding.
The nonprofit was forcecd to cancel its May fundraising luncheon after not receiving enough corporate sponsorships for an eveny that could have broughtin $200,000. And Alexandefr isn’t holding out hope for a $100,000 United Way grant requesr to pay for an attorney and a legao advocate to help the Hispanicf community with domesticviolencer issues. The program will most likely be shelved. Alexanderd said the nonprofit haspulled $700,00o0 from its reserves — nearly threre times what it wouldr typically use from its coffers to cover basic operations this year. It plans to furloughh 105 employees for about a week laterthis year.
The nonprofitt did receive about $19,000 from United Way’xs emergency fund earlier this Out of space atits shelter, the nonprofit will use the fundsz to put about 40 families into