United Way to Defer Agency Grants, Cut Staff

Although it will mean layoffs and either deferring or cutting grants to agencies they fund, officials from United Way of Ventura County have launched a plan aimed at avoiding a projected $300,000 deficit by mid-1998.

The three-year plan, released Tuesday, calls for deferring grants for the next eight months to 59 member agencies, which range from counseling services to food pantries, as well as cutting staff from 18 to 12 by Dec. 1.

Officials say they are also developing strategies that will help collect hundreds of thousands of dollars in unpaid pledges, money committed by local firms and their employees.

Admitting that they should have taken corrective steps months earlier, officials said tightening their belts for the next three years should get finances back on the right track.

“These are things we should have been addressing a year ago,” said Spencer Garrett, acting chief financial officer. “Instead of having someone go out and find new dollars, we’re now looking at how to collect pledges already made.”

Officials say they realized that they were in trouble during the 1996-97 fiscal year when the agency allocated more money than it took in. During this period, it distributed $3.7 million to member groups and spent $1.3 million in operating expenses, while only taking in about $4.5 million in cash from previous campaigns.

“These [staff cuts] come as a result of recognizing the need to reduce expenses,” Garrett said. “Because staffing is our largest expense, it’s an area we felt we needed to start with.”

Also, beginning Jan. 1, benefits for remaining staff members will be cut about 8% annually, a move that will cost them $100 more per month for medical and dental benefits.

Last year, salary expenditures totaled $665,945--an increase of more than $88,000 from the previous year. But officials plan to reduce that amount by more than $58,000 during this fiscal year.

In fact, the highest-paid salary in the agency--the president’s--will be decreased from $75,000 annually to between $50,000 and $70,000 when officials fill the vacancy left by the resignation of Ernest Thurmond last month.

In addition to juggling positions and employee benefits, officials are still trying to devise a plan to collect at least 10% to 12% of unpaid pledges to reduce the impact of their financial crunch.

During the last four years, the percentage of unpaid pledges has increased to about 17%, or between $800,000 and $900,000. The increase in unpaid pledges is attributed in large part to companies either moving out of the area or downsizing, officials said.

Deferment of funds to United Way benefactors is also expected to reduce the agency’s projected deficit. Under the deferment plan, the amount of money the benefactors receive beginning next month for eight months would be 7.5% less than what they previously collected.

If United Way’s fund-raising campaign reaches its goal, the benefactors could receive the deferred amounts at a later date.

“But if our campaign doesn’t meet its goal, that deferment may end up not being a deferment but a cut. . . . We’re in a catch-up role and may have to reduce future funding,” Garrett said.

Reaction among agencies that receive funding from United Way has been mixed.

“It certainly tightens our belt,” said Ann Sobel, executive director of the American Red Cross of Ventura County. “We won’t see a reduction in services, but we will have to put off the extra things we had hoped to accomplish, such as facility maintenance.”

While AIDS Care Director Doug Green said his agency will simply hit up other funding sources, Catholic Charities is facing serious setbacks in the services it offers.

“The program directors have been put on alert that we need to find extra ways to make ends meet,” said Mary Ann Decaen, community services coordinator.

“We’ve already been cut back over last two years--it will be tough,” Decaen said. “All of our programs are taking a hit; I don’t know who will be hit the hardest.”