Local agencies due funds

Twenty-nine agencies have been waiting since October for more than $400,000 they collectively were promised - money that is supposed to go for programs to help the elderly, disadvantaged children and low-income families.

At least one agency is struggling to keep the lights turned on because of the situation, an official there said.

"We are juggling bills, paying a little on this one and a little on that one to keep people from shutting it off," said Jewel Flemons, an administrator at Tucson Nursery School and Child Care Centers. The agency serves underprivileged children in the Pueblo Gardens neighborhood.

The nursery school is owed about $7,500, and officials there don't know when they'll get the money.

"It's very surprising because we've never had a problem with United Way not paying," said Flemons.

"But the way the economy is right now, you never know what's going to happen."

A United Way spokesman said the recession is to blame for the fundraising organization falling behind on its obligations.

"It was kind of the perfect storm," said spokesman Dan Duncan. "It's never happened before."

In the budget year that ended in June, the United Way was hit with more than $1 million in realized and unrealized investment losses, Duncan said.

And workplace giving, which raised $8.2 million in pledges last year, is expected to decline this year because workers laid off from local businesses can't pay what they pledged, he said.

Ordinarily, about six percent of United Way pledges go uncollected. That figure could be as high as 10 percent this budget year, Duncan said.

To offset some of the impact, the agency has trimmed overhead spending by about $1 million, which included cutting 7 staff positions, he said.

Duncan said United Way is looking at ways to pay up quickly in critical cases, such as the nursery school where Flemons works.

But other charities owed money will have to wait until the auditor hired in early December makes recommendations to improve the United Way's cash flow management system.

Ironically, Duncan said, the payment problem has arisen as the United Way is on track to raise more money than ever - around $18 million this year compared with $12.5 million last year.

But in both years, most of the money comes with strings attached that limit how it can be spent.

Government grants, for example, can only be used for specific programs, which also is true of donor designations - where givers choose a particular charity to receive their contributions. Money from both those sources has been paid out to local charities, Duncan said.

The money United Way still owes - in amounts ranging from $7,500 to $62,000 -are for programs that get unrestricted donor dollars, money that was given without any conditions on how it can be used, he said.

Asked how much unrestricted cash the United Way has right now, Duncan said agency officials aren't sure. That's part of what the auditor is sorting out, he said.

That doesn't sit right with Jim Murphy, president and chief executive of the Pima Council on Aging, which runs support programs for the elderly and is owed about $62,000.

"The United Way certainly should know how much cash it has on hand," Murphy said. "The steps they are taking seem to be appropriate, but it seems to be a number of months now that they've been unsure of their cash position.

"I don't know how any agency with the depth of experience they claim to have could get into that situation."

Still, Murphy and other charity executives say they're getting by for now and hoping for the best.

"We've been good partners with the United Way for many years," said Eric Schindler, president and chief executive of Child and Family Resources, Inc., which runs family support programs and is owed about $25,000.

"We're cautiously optimistic that they will get their cash flow to a point where they can make the payments."

Contact reporter Carol Ann Alaimo at calaimo@azstarnet.com or at 573-4138.