County Charity Group Had Expected $19 Million in ’86 : United Way Shows $2.5 Million Shortfall

United Way of Orange County raised $1 million less in 1986 than in 1985, falling $2.5 million short of its $19-million fund-raising goal for this year, communications director Judy Trest said Tuesday.

Trest said the three-month drive, which ended with a banquet Tuesday night at Anaheim Hilton, drew pledges of only $16,514,227.

The local organization--the fastest-growing United Way effort in the country from 1975 to 1985--announced Monday that an expected shortfall in contributions would mean as much as a 10% reduction in 1987 funding for the 123 social service agencies it helps to maintain.

Trest said the local United Way’s board of directors will decide later this week exactly how much the funding reductions will be.

Heads of United Way agencies already have been advised of the shortfall, and some said Tuesday that their already tight budgets will have to be cut because of the failure to meet this year’s goal. Last summer, United Way of Orange County was forced to cut funding 5% because only $17.5 million of the $18.4 million pledged last year was actually collected.

Employee layoffs at the Irvine Co., Northrop Corp. and Flour Corp., coupled with mergers of Crocker and Wells Fargo banks and other large corporations, were responsible for the shortage in collections of last year’s pledges, and that trend has continued, Trest said.

David Carroll, Pacific Bell area vice president and fund-raising chairman for next year’s United Way of Orange County campaign, said Tuesday that the $16.5 million pledged in 1986 is “very disappointing.”

“It’s much lower than I had anticipated,” he said. “It causes us to really evaluate this line by line.”

In addition to the county’s economic climate, a controversy involving the Los Angeles United Way contributed to the Orange County shortfall, United Way officials have conceded. Earlier this year, it was disclosed that $300,000 in cash loans had been made since 1980 to five top employees of the Los Angeles organization.

Merritt L. Johnson, president of United Way of Orange County, said the local group was tainted by that episode because the public does not realize that all United Way agencies are autonomous.

Carroll said the local United Way organization must re-evaluate its fund-raising efforts and search for more smaller contributors. Traditionally, United Way collects about 90% of its contributions from large corporations.

“There is nothing wrong with the Orange County economy overall,” Carroll said. “But it has shifted dramatically over the past few years from a few big organizations to hundreds and hundreds of smaller companies.

“We no longer can rely on just a score of really large corporations that support us. If these organizations came back strong, so much the good. But we have to broaden our base of support.”

Carroll said his volunteer campaign committee next year could be as much as 30% larger than this year’s group in an effort to reverse this year’s shortfall.

“My feeling right now is that there is nowhere to go but up, but we need to do a better job of getting volunteers,” he said.

Agency heads notified of the funding cutbacks were worried Tuesday about the impact on their organizations.

John Garrett, executive director of the Orange County Assn. of Mental Health, said the United Way shortfall would mean $15,000 less for his organization.

“We’ll have to come up with some money, or even in-kind donations, to make up for that money,” he said. “If not, we’ll have to cut some corners.”

Garrett said about half of the association’s money comes from United Way. He said smaller organizations that depend heavily on United Way contributions “are really going to be hurt.”

Margaret Reister, director of El Modena Community Center in Orange, agreed. Her center receives 80% of its $110,000 budget from United Way. It now stands to lose almost $9,000.

Reister, who was answering her own telephone on Tuesday, said an opening for a receptionist will not be filled.

“We’re going to do the best we can, but it won’t be easy,” she said. “Some agencies have reserves to help. But we have nothing to fall back on, and we’re going to hurt even more.”

Susan Leidel, director of Women’s Transitional Living Center in Orange, said the organization will lose about $7,000 in United Way funding. The center provides shelter and counseling to women and children who are victims of family violence.

“It makes for a very difficult situation,” she said. “United Way is one of our most stable funding sources.”