United Way agencies face steep cutbacks due to COVID, less giving, leader says
United Way agencies in the Charlotte region should brace for funding cutbacks of 54% to 68% next year, due to COVID-19 and less workplace giving, president and CEO Laura Clark said Tuesday.
Contributions have declined for years, and the agency dipped into its reserve fund last year to compensate for the effects of the coronavirus on giving, Clark told The Charlotte Observer.
But United Way of Central Carolinas can no longer take from its reserves, and its annual fundraising campaign that’s now underway is expected to bring in $3 million less than previous years, she said.
That figure is preliminary, “because we are waiting for all of our numbers to come in,” Clark said. “But part of our commitment is to tell our agencies as much as we can as soon as we can, so they can be prepared.”
Those 70 nonprofits include some of the best known names in Charlotte and nationwide, including The Salvation Army, Communities in Schools and Goodwill.
“We have used our reserve fund for most of the last decade to help cover the gap between what we were raising and what we were giving out, so we could maintain a certain level of funding into the community,” Clark said.
“And our board signaled a couple of years ago that we were not going to be able to do that much longer. Because of the pandemic, last year they did do it. And so the funding wasn’t as greatly impacted. But this year, we just can’t do it anymore.”
Agencies that receive United Way “impact grants” will be most hurt, according to Clark. Those grants represent “our largest pool of funding,” totaling $8.8 million this year, she said.
Two United Way community initiatives, Unite Charlotte and United Neighborhoods, will not experience cuts, “because they are really central to our focus on economic mobility and racial equity and have attracted restricted donor gifts,” Clark said.
United Way officials delivered the news in a virtual meeting Tuesday morning with leaders of the nonprofits that receive United Way funding, Clark said.
“These organizations are still facing unprecedented needs in this community, and it’ s not going to go away overnight,” Clark said. “And unfortunately, we are giving them this news and they are still dealing with the impact of the pandemic.”
“The bottom line is services will be impacted,” she said. “They’re going to have to go out and replace these dollars, and because they are general operating support (grants), they are difficult to replace.”
The United Way also launched “a reinvention planning, because we recognize that this revenue problem isn’t going away,” Clark said.
Officials are trying to determine how the United Way “will continue to support the non-profit sector in the long-term,” according to Clark. “We’ve done everything we can do, we’ve outsourced, we’ve reduced our staff.
“All options are on the table,” Clark said. “We want what works for this community, this region. We believe in the power of collective giving for collective good. All of these agencies are doing incredible work, and if I can relieve their burden by doing a little fundraising for them, that allows them to focus on their mission.”
United Way support “has been critical to our ability to meet the needs of our community’s most vulnerable neighbors,” Major Todd Mason, area commander for The Salvation Army of Greater Charlotte, told the Observer on Tuesday.
As with the other nonprofits, “we will have to look to our other partners and the community at large to make up the difference,” Mason said in an email.
“Many in our community are still reeling from the effects of the pandemic, and we know they will be for some time,” Mason said. “It’s more important than ever for us to come together to meet the challenges ahead.”
This story was originally published March 16, 2021 at 6:24 PM.