United Ways Seek a New Identity

Many shift from just collecting gifts to leading the battle against social ills

In January, the United Way in Los Angeles announced a change in the way it operates.

The United Way will be concentrating more and more of its resources on a single objective:

helping poor residents of Los Angeles County become self-sufficient. The goal was set not by the United Way alone, but in collaboration with charity, corporate, and government leaders.

As a sign of its seriousness, the United Way already has told 15 charities that don’t focus directly on fighting poverty — including the American Cancer Society and Cedars-Sinai Medical Center — that $4-million that they had expected to receive will instead be going to new programs to narrow the gap between rich and poor.

The Los Angeles program, called “Community Agenda,” is part of a bigger trend that is occurring at United Ways across the nation.

From Atlanta to Columbus, Ohio, to San Francisco, United Ways are trying to transform themselves from mere collectors and distributors of charitable contributions into organizations that collaborate with key community leaders to help cities determine their most urgent social problems and then come up with the money and ideas to tackle them.

United Ways that are taking the new approach are reaching out not only to the civic and charitable establishment in their cities, but also to new generations of grassroots leaders and neighborhood activists who deal with day-to-day problems like poverty, homelessness, and juvenile crime.

“We see ourselves as the community builder, the consensus maker, the convener, providing a table for us all to sit at,” says Sheila Hill-Fajors, president of the United Way of the Bay Area, in San Francisco, which has adopted the new strategy.

As part of the approach, United Ways are setting specific goals for the programs that they support — goals designed to make long-term changes in the lives of residents — and then closely following up to see if change indeed occurs.

“Our business is community development, quality of life, and human development,” says Brian Gallagher, president of the United Way of Franklin County, Ohio, which serves the Columbus area.

The change in approach is occurring amid unprecedented challenges for the charitable federation. United Ways face fierce competition from other charities and from Internet donation services. What’s more, United Ways have a smaller share of discretionary dollars than ever before: More than $1 of every $5 contributed to United Way is earmarked for a cause, compared with about 12 percent a decade ago.

The rise in earmarking comes at a time when giving to United Way, by some measures, is slowing down. United Ways raised $3.6-billion in 1998-99 fund-raising campaigns — 8 percent less than in 1990, after taking inflation into account.

Not only that, but the proportion of U.S. corporate employees who had access to a United Way fund-raising campaign and made a donation fell from nearly 47 percent in 1989 to 35 percent in 1998.

The new strategy marks a significant attempt to rebuild donor loyalty and break away from an entrenched United Way model of operating. For years, United Ways saw their main goal as raising money for a select group of local health and human-service charities. Most measured their success in terms of year-to-year gains in their annual fund-raising campaigns, and they awarded money to charities that provided basic social services with few strings attached.

Now, says Mark O’Connell, president of the United Way of Metropolitan Atlanta, a pioneer of the new approach, United Ways are looking for ways to differentiate themselves in a crowded field of other charitable groups and to define success in a new way: in relation not to their fund-raising role but rather to their ability to achieve broad civic goals that no single donor, citizen, or charity could accomplish alone.

“People can give to agencies alone — in fact, the Internet is going to make it easier and easier for that to happen,” Mr. O’Connell says. “But the Internet and other ways that organizations raise money are poor substitutes for how communities come together, agree on what the work is and figure out how to do it, and then hold themselves accountable for returns, for results, and impact.” United Ways, he adds, must “offer donors a value that they can’t easily duplicate another way.”

Betty Beene, president of United Way of America, says that even as United Ways are putting more money and effort into coming up with long-term solutions to social problems, they will not give up their traditional role of supporting essential services for society’s most vulnerable.

“United Ways in every community will always want to be in the position that they are providing a safety net of sorts for the people who have the least voice and the least capacity,” she says. “But that doesn’t mean that at the same time, the United Way will not focus on some very strategic problems and needs in its community.”

United Ways across the country are using a variety of strategies to get that idea across.

In San Francisco, the United Way joined with local hospitals, community foundations, and grassroots leaders and asked them to help determine the chief social-service needs in the seven-county San Francisco region. The United Way grouped those needs into eight categories, including public health, education, and jobs and work-force development. United Way officials then began to change the way they distributed money, scaling back on their practice of channeling dollars to a select group of charities year after year.

“We decided it would no longer be an entitlement mode of grant making,” Ms. Hill-Fajors says. “We wanted to focus on the question of what were the needs of families and children, as opposed to what were the needs of the YWCA or the Girl Scouts council or the family-services agency.”

This year, a third of the discretionary money that the San Francisco United Way awards is going into long-range “community change” projects. Next year, that proportion will grow to two-thirds, she says. And many of those programs will be run by charities that have never before received United Way money.

“We know that there were many, many really good family-service-type groups in the community that we were not reaching,” Ms. Hill-Fajors says.

Altogether, perhaps 350 local United Ways, out of a nationwide total of 1,400, have adopted the new strategy or are considering doing so, according to Irv Katz, a vice president at United Way of America.

As it begins to spread, the new model is drawing a mix of criticism and praise. Many business and civic leaders embrace the idea of a more nimble and collaborative United Way system, one that looks beyond immediate needs and tries to find permanent solutions to issues that a broad cross section of citizens identifies as key.

But some critics argue that by focusing on long-term goals, United Ways are moving onto the same turf that community foundations and national grant makers have staked out.

Others, including Gloria Smith, executive director of the Columbus AIDS Task Force, in Ohio, say that United Ways could wind up hurting their image with donors if they no longer maintain close partnerships with a set of local charities and function as a centralized fund-raising source for those groups.

“United Way has some pretty strong skills, but they’re missing the boat on this one,” says Ms. Smith, a former United Way staff member.

She also says that by shifting attention toward discrete categories of long-term goals, United Ways could be hurting social-service groups whose work doesn’t coincide with the new focus.

The Columbus AIDS Task Force has both benefited and lost from the new approach being taken by the United Way of Franklin County, Ms. Smith says. The charity received $20,000 this year for a program that relates to one of the United Way’s new agendas: race relations. But it has won virtually no increase in the basic support it has received from the United Way in recent years. That support currently amounts to 13 percent of the charity’s $2.6-million budget.

The AIDS group’s programs aren’t threatened by the change in the United Way’s priorities because the charity receives money from other sources, including corporate donations and government grants, Ms. Smith says. Still, she notes, the flow of money from those sources can be unpredictable. Her message to United Way: “You’re the only dollars that I don’t have to rehustle all the time.”

Mr. Gallagher, the president of the Columbus-area United Way, acknowledges that tensions have arisen over the new approach. “No question, we’ve taken some heat for what we’ve done,” he says. “But the support in the community far outweighs any criticism.”

One reason that a growing number of United Ways are adopting the new approach is that donors — especially wealthy contributors who are supplying an increasingly large percentage of United Way revenues — are demanding tangible proof that United Way programs make a difference.

In Los Angeles, United Way revamped its approach because of numerous factors, including depressed fund raising caused by massive layoffs in Southern California in the mid-1990’s, a desire to focus on the causes of poverty, and the growing demands of donors.

“Our donors are telling us they want to see more results for their money,” says Todd Rosin, a spokesman for the Los Angeles United Way. “To do that, we can no longer be all things to all people.”

The focus on dealing with problems of greatest concern to donors and community leaders is reflected in the strategies that United Ways in places like Atlanta and San Francisco are employing.

As a prelude to changing its approach, the United Way of Metropolitan Atlanta conducted surveys of corporate employees and chief executives, elected officials, heads of government agencies, high-school students, non-profit leaders, and charity clients to determine what they believed was the single biggest human-service issue facing the Atlanta area. The answer: neighborhood crime and violence.

The United Way then developed 13 strategies aimed at changing conditions that cause crime to exist in the Atlanta area. Among the strategies: ensuring that children have adequate supervision outside of school and encouraging residents to become more involved in civic and neighborhood affairs.

Then the United Way invited charities — including ones that had never before received United Way money — to propose programs that would focus on the 13 anti-crime strategies.

In addition, the United Way has created new programs to improve public safety and found partners in the non-profit and business worlds to help carry out those programs.

For example, the United Way created a program that dispenses matching cash subsidies to low-income residents to help them buy their first home. To be eligible for the program, residents must agree to buy their home in one of five sections of the metropolitan area, a stipulation that Mr. O’Connell says is designed to reduce crime by enhancing neighborhood stability.

In another such long-term effort, the Atlanta United Way is encouraging the Georgia state government to raise standards for licensing child-care facilities and to increase state subsidies to families that use such facilities. The program relates to the public-safety theme because it is designed to help children succeed in school and to cut down on juvenile truancy, which is strongly linked to juvenile crime, Mr. O’Connell says.

In each of the past two years, the Atlanta United Way has increased by $1-million the amount it puts into supporting local child-care centers. This year, it will put $6-million into such centers. In addition, the Joseph B. Whitehead Foundation, in Atlanta, has committed $10-million toward building more child-care centers, Mr. O’Connell says. By forming a “public-private partnership” with government and the foundation world to expand high-quality child care, he says, the United Way can accomplish what “no donor could ever do alone.”

A similar collaborative philosophy has taken hold at the United Way of the Bay Area, in San Francisco. It has been working closely with several individual donors who want to support programs that fit with the United Way’s new emphasis on helping families and children. It also has sought out the expertise of others to help develop programs that achieve those aims.

In one case, the United Way has worked with a prominent northern California donor and business leaders to create Technology to Recover Abducted Kids, or TRAK, a program that helps local police departments use advanced communications technology to find missing people.

In another example, Ms. Hill-Fajors says, the San Francisco Giants outfielder Barry Bonds wanted to increase academic achievement in low-income neighborhoods in the San Francisco Bay Area and asked the United Way to help. The United Way consulted academic experts to determine the best way to proceed, then worked with local school officials and grassroots neighborhood centers to identify which schools might benefit the most from such an effort.

The result is a program called “Link ‘n Learn” that will begin in four Bay Area school districts this fall, at a cost of $2.5-million over two years. The United Way has put about $85,000 into the program so far, plus helped to attract money and technology from corporate partners such as the AT&T Corporation and IBM, Ms. Hill-Fajors says. Mr. Bonds has contributed $100,000 to the effort and has pledged to give more, Ms. Hill-Fajors says, but she adds: “He doesn’t want to dominate it.”

While the new collaborative strategy has spawned similar partnerships in other cities, its emphasis on long-term needs has raised concerns among some charity officials.

Some contend that while United Ways may have the dollars to pour into ambitious long-range goals now, they might have to scale back or abandon the strategy if the economy slows.

But advocates of the new strategy say it represents the best way to achieve visible results and keep donors engaged with charitable programs.

“I still hear it every day from someone: ‘The United Way of the Bay Area is not the organization that I remember from 40 or 50 years ago,’” says Ms. Hill-Fajors.

“My response is that we are still the organization that is committed to making this a better community. And if it means we have to take a chance to do it differently to make it effective, then that’s the right thing to do.”