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Published: Sunday, 8/17/2003

Weak economy batters budgets of social agencies

BY MIKE WILKINSON
BLADE STAFF WRITER

A few years ago, Pam didn't need the help, didn't need the all-important calories that the Helping Hands of St. Louis soup kitchen provides.

As a certified nurse's aide working in Michigan, she did well enough to have an apartment and a late-model car. But then her health started to fail, she lost her job, her car, and her residence.

She found herself back in her hometown, looking for help.

“I'm not used to being like this,” says Pam, who asked that her real name not be used.

At a time when unemployment hovers locally at 11 percent, people like Pam are struggling and many need the assistance - food, medicine, shelter - that nonprofit agencies like Helping Hands offer.

But the troubles that are putting people in soup lines and homeless shelters have had a similar impact on those who give, triggering a domino effect that has pounded nonprofit agencies from all sides as government, individuals, and corporations find it more difficult to help.

It has put local nonprofits on soft financial footing, with everyone from the soup kitchens to the symphony, from public broadcasting to a local state park searching for money to keep programs, services, and the arts afloat.

“The outreach programs, we're heading in the same direction as the clients we're trying to serve,” says Linda Lupien, director of Helping Hands.

It's a quick turn-around from the gold-plated 1990s, when corporate coffers bulged with profits, pushing the stock market to places unseen.

Meanwhile, charitable foundations watched their bank accounts grow ever fatter on the largesse, prompting huge increases in donations.

For nonprofit groups looking for some financial help, it was a buffet of riches.

The times were good for almost everyone. And nonprofits were not insulated from the fiscal euphoria that embraced the nation.

“Who wouldn't think it would go on forever,” asks Mary Mancini.

But Mrs. Mancini, an Ottawa Hills resident who has helped raise money for public broadcasting and other local groups, now knows that the heady days did not last. And the results have cut across a wide swath of the Toledo area's nonprofit groups that provide everything from health care to the soothing sounds of the local orchestra.

WGTE, the local public television station, laid off seven employees in July. The symphony is cutting staff and reducing the number of musicians. A local day-care provider for teenage moms has had to trim its hours.

Those agencies that have maintained their funding have done so by freezing wages and looking everywhere for savings.

At Toledo Day Nursery, which provides day-care services to low-income working families, a loss of $30,000 this year led to the elimination of an administrative position. Still, no clients have been turned away - yet.

“I pray we can just hold our own,” executive director Pat Scheuer says.

But now, when these agencies need help, they have fewer places to turn.

Foundations, which typically donate the interest on their investments, have been hammered by the economy's fall. The assets of the Ford Foundation, one of the nation's largest, dropped by $3.8 billion two years ago; grants dropped a corresponding $330 million.

Local foundations can tell the same story. At the Stranahan Foundation, started by the founders of Champion Spark Plug Co., grants retreated from $5.2 million in 2001 to less than $4 million last year, officials said.

Meanwhile, one of the area's biggest benefactors, the United Way, has watched as its donations -and its allocations - drop for three consecutive years. The agency relies primarily on employee contributions and corporate donations.

With fewer employees and smaller profits, the results have been predictable: Less money in, less money to give out. This year, the agency intends to expand its circle of giving to include more companies in order to generate more donations, says Bill Block, Jr., chairman of this year's fund-raising campaign.

Mr. Block is chairman of Block Communications, Inc., the parent company of The Blade.

For those agencies that get government funding, it too is down in some cases. At Helping Hands, its city and county funding was reduced by 25 percent, forcing the charity to cut back on food pantry hours, add restrictions on who's eligible for help, and even limit how much everyone can eat.

No matter where they turn, it seems, officials at nonprofit agencies are finding little solace.

“It's kind of like a freight train coming at you,” says Sandy Jacobsen, who has traveled the country giving seminars to nonprofit agencies on how to deal with cutbacks.

Ms. Jacobsen was in Toledo last week and found a receptive audience.

More than 50 people attended, sharing horror stories and looking for any tips on the funding problems that more than half said keep them up at night.

Toledo can take some solace in the fact that it isn't alone. United Way chapters across the country have experienced similar declines. Donations for most charities have ebbed. Many point to the terrorist attacks of Sept. 11, 2001, as the beginning of the slowdown.

In San Francisco, for instance, the local public television station slashed 31 jobs - more than 10 percent of its staff - and reduced the hours of the rest.

Station officials blamed the cuts on the same trends affecting Toledo: individual donors, some making less money, have less to share, as do corporations.

To wit: In December, ExxonMobil announced it would cease to fund Masterpiece Theatre after more than two decades of support.

Don Schlatter, chairman of the board of Art Iron, a steel fabrication firm, has seen every side of the issue. As a company leader, he's seen profits decline and donations diminish by 5 to 10 percent. He knows the company's layoffs - it's trimmed 20 percent of its workforce - will affect United Way contributions.

But he knows there's a greater need too. As president of the Toledo Rotary Foundation, he has received more requests for money from struggling agencies and groups. It's made for lively discussions among the committees - both at Art Iron and the Rotary Foundation -about what to fund.

“What's more important? Health issues? Education issues? Arts issues,” he asks.

Sometimes, there isn't even a debate - because there's no longer any money. Take the case of General Mills, the cereal giant that long operated a plant on West Laskey Road making, among other things, Cheerios.

Before its complicated sale to International Multifoods Corp., the company actively sought to help local charities. In the 1999-2000 fiscal year, the foundation doled out nearly $500,000. In the 11 years between 1989 and 2000, Bob Scarlett, a former General Mills employee, estimates the foundation gave out a little more than $1 million to the arts community alone, typically a third of its total donations.

Among those groups benefiting from General Mills' generosity: The Toledo Symphony; Mom's House, a day-care center for unwed mothers; the Good Samaritan Outreach Center; St. Anthony Villa; Toledo Day Nursery, and the Toledo Northwestern Ohio Food Bank.

“And we know, having talked with and toured the agencies, that it was money well spent,” says Mr. Scarlett, who led the committee that determined where the foundation's money would be spent in the Toledo area.

But the General Mills Foundation has a policy of contributing only in communities where it has plants. And it no longer has one in Toledo.

“After they left, their money did as well,” Mr. Scarlett sighs.

Dr. Richard Ruppert is the former president of Medical College of Ohio and a civic leader who has helped raise money for a number of groups and projects. As a member of the Ohio Historical Society, he is trying to raise money to complete renovations to Fort Meigs State Historic Park in Perrysburg, site of important battles during the War of 1812.

The historical society had expected state funding for the picnic tables, cannons, and the museum on the site.

But budget cuts caused the historical society to turn to the public for money. The goal: $1.5 million.

Dr. Ruppert, however, knows it won't be easy and so far has raised little more than $500,000. “It's difficult for everybody, on a personal basis and a corporate basis,” he says. “And when they can't they can't.”

Despite his desire to help the park, he has a healthy attitude about how long it may take. He knows that history may have to take a back seat for now.

“We have to take care of people,” he says.



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