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Wednesday, Feb. 25, 2009 11:58 am

United Way changes where charity dollars go

Even good causes involve legal clauses

John Kelker, president of United Way of Central Illinois.

For most worker bees, the annual on-the-job charity drive means a chance to make a painless payroll-deduction pledge to a worthy cause and then celebrate with a pizza party in the company cafeteria. Most workers don’t stop to read the fine print or fret about what happens to their donations. After all, a good cause is a good cause.

However, over the past few years, United Way of Central Illinois has altered the charitable landscape in some subtle but significant ways.

The most noticeable change will be revealed in April, when United Way’s board of directors will announce how much money it will allocate to various charitable agencies. This year, for the first time, the United Way has tapered its focus to only two categories — “essential services,” funding nonprofits that offer food, shelter, healthcare and victim services; and a newly-created category called “continuum of learning,” funding nonprofits that “ensure participants are ready to learn, ready to work and ready to succeed,” according to the United Way’s colorful brochure.

In the past, United Way’s member agencies have applied for grants under four broad categories — nurturing children and youth, strengthening families, basic needs and fostering independence. Each of the approximately 1,300 United Way of America offices tailors its campaign to its community, and this new, narrower concentration is unique to the United Way of Central Illinois.

John Kelker, president of the local United Way, says the “continuum of learning” concept is the result of a needs assessment study that he commissioned more than three years ago. The study, completed in 2006, indicated that the top need in this community is access to healthcare. The United Way board decided that such a complex issue was best left to experts. “Let our healthcare professionals do that,” Kelker says. Instead, the board honed in on education as the root cause of many other needs identified by the study.

This year, 43 percent of United Way donations will go to programs that fall under the continuum of learning, while 57 percent will go to essential services. Kelker acknowledges that this new hierarchy may mean that some programs traditionally funded by United Way may not receive their usual grant this year.

“But if it does, we will certainly have the opportunity to fund programs that have never applied to us before,” he says.

The continuum component is built on a partnership among United Way, the Greater Springfield Chamber of Commerce and the Sangamon County Community Foundation. The foundation will contribute a grant from the Grand Victoria Foundation, which is funded by the Grand Victoria Casino in Elgin.

The continuum of learning drawn by the United Way is divided into five stages — birth to pre-kindergarten, kindergarten to fifth grade, sixth through 12th grade, and post-secondary. For each stage, the United Way brochure provides a snapshot goal. For example, nonprofits applying for money under the continuum’s third stage (sixth to twelfth grades) have to show that they “develop competent young people with the tools and skills for making appropriate decisions on their way to graduating from high school and becoming productive members of society.”

Six panels made up of nine to 11 volunteers apiece will review applications beginning the first week of March, and by late April will send recommendations to the United Way board, which will ultimately decide how to distribute the money among its member charities.

In addition to this new emphasis on education, Kelker has also forged another major change in workplace fundraising, subtler but perhaps more significant. Around 2006, he set in motion a series of events designed to give United Way of Central Illinois extraordinary influence over the annual payroll deduction campaigns of major public sector employers.

Traditionally, a coalition called the Sangamon County Combined Campaign coordinated the payroll deduction drives for Sangamon County, the city of Springfield, school District 186, and Lincoln Land Community College. Every year, the executive committee of the SCCC hired a contractor to actually administer the drive, and every year, United Way won that contract. That didn’t mean Kelker could conduct a regular United Way campaign in these workplaces, however; government employers are bound by different rules than private employers. For example, state law demands that government employees have the option to contribute to any legitimate charity, including agencies like American Cancer Society, Special Olympics, the Sierra Club or the Animal Protective League — none of which are associated with United Way. Therefore, at government job sites, each employee received along with his or her pledge form a booklet listing every nonprofit certified by the state of Illinois.

In 2005, according to minutes of an SCCC executive committee, Jack Daniels, who was then president of LLCC, asked whether the group could be disbanded and LLCC could host a United Way campaign. The committee didn’t answer the question at that meeting, and Daniels resigned the following month. But Kelker took Daniels’ question as a suggestion, and the following year wrote a letter to LLCC’s interim president “encouraging Lincoln Land to terminate their participation in the Sangamon County Combined Campaign in favor of . . . United Way of Central Illinois.”

Kelker also lobbied the other SCCC members with a one-page chart contrasting the SCCC with United Way. Among his selling points: Campaign events, public recognition for donors who give at least $500, a savings in handling fees (by eliminating the fee altogether for United Way), and a wider range of recipient agencies. This last carrot was based on United Way’s promise to include not just the nonprofits certified by the State of Illinois but any 501(c)(3) agency in compliance with the U.S. Patriot Act. Lincoln Land made the switch in 2006, and the other public sector employers soon followed.

But instead of offering a bigger pool of nonprofit beneficiaries, the United Way form that Kelker provided to LLCC employees in 2006 appeared to restrict donors’ options to United Way’s 30 charities. Agencies that had been members of SCCC and had previously benefitted from its charitable campaigns cried foul.

Mike Doyle, then executive director of a federation of 36 charities called Community Shares, became spokesman for the other charity collectives — Special Olympics of Illinois, Black United Fund of Illinois, Earth Share of Illinois, Community Health Charities of Illinois, America’s Charities, Global Impact, and Independent Charities of America — in an effort to get their agencies back into the donation loop. He filed requests under the Freedom of Information Act and even threatened legal action, citing the state law that requires public sector workplace giving campaigns to provide equal access for all legitimate charities.

Eventually, Doyle won a settlement that resulted in a new pledge form with five big blanks where donors can list any 501(c)(3) charity. However, if a donor doesn’t list a specific charity, the money goes to “programs in Central Illinois addressing the greatest need,” according to the form. This phrase, Kelker says, means the money goes to United Way, to be allocated to one of its member agencies.

This form is currently used by District 186, the city of Springfield, and LLCC, but Kelker says he plans to transition all these employers to the form he calls “our traditional blue form,” already in use by Sangamon County. That form provides a half dozen check-off boxes for making a donation to United Way, and one line in the bottom right-hand corner for a donor to write in the name of another nonprofit agency. Such write-in pledges have to meet a $25 minimum (United Way donations don’t), and will be reduced by a 15 percent handling fee.

Doyle, now employed by the YMCA of Champaign County — a United Way organization — calls this fee structure “discriminatory” and remains suspicious of Kelker’s tactics, citing the United Way president’s lobbying efforts to dismantle the SCCC. “Kelker would never really tell the other charities what was going on,” Doyle says. “We probably trusted him too much for our own good.”


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