United Way CEO hires lawyer Diehl

United Way President and CEO Gloria Pace King has hired prominent Charlotte lawyer Bill Diehl to represent her in negotiations with her board of directors stemming from the growing controversy over her pay and benefits.

The board added $822,000 to King's retirement benefits last year, a six-fold increase over the $108,000 paid in 2006. It plans to pay between $450,000 and $500,000 into her retirement account each year for the next three years.

King's salary and bonus make her the fourth-highest-paid United Way executive, according to an Observer survey of 32 agencies. Only the United Ways in New York, Detroit and Miami pay more.

The Charlotte board has said the additional retirement payments were needed to make up for short payments in previous years. It has declined to explain why the catch-up payments were needed or say how it set the size of King's pay package.

In response to Diehl's hiring, the Observer called King, and the board's attorney, public relations firm and spokesman, former board chairman Ned Curran. But none commented Saturday.

It's unclear why King hired an attorney. But Diehl told the Observer on Saturday: “She came to me because there's been a big splash in the newspaper.

“The board is making a big to-do about something they previously approved. They're very defensive about the fact that she's gotten this retirement plan they gave her. It's crazy. They gave her the plan two years ago. And now they're concerned about it because somebody's written about it.”

On the eve of the United Way's 2008 fund-raising campaign, anger towards the agency continues to grow, threatening donations that support 91 non-profits.

“It's a publicity nightmare because the board hasn't taken the right approach to the situation,” Diehl said. “If somebody did something wrong, it's not Gloria King.”

Diehl said the board has not asked King to resign. He said she signed a three-year contract in January. “She's 63 years old and she expects to retire in two years.”

King, president and CEO since 1994, has declined to comment since reports about her pay surfaced in June. Her board has defended her salary and benefits as appropriate for top-performing executives.

United Way of Central Carolinas is ranked among the United Way's top 20 largest fund-raisers. The watchdog group, Charity Navigator, gives King's agency high marks for efficiency. The board credits King with boosting the agency to No. 2 in the number of donors giving at least $10,000.

Yet, the controversy over the board's handling of her pay has hung over the city for months.

For the first time in 40 years, philanthropist David Barnhardt will withhold his United Way contribution in protest. He plans to write checks for charity this year, but says they “will go directly to the Girl Scouts or some other nonprofit.”

Barnhardt, 72, whose father was an original director of what became Foundation for the Carolinas, says he's most bothered by “the fact that the board has been sneaky and tried to slip all this past the public.

“They've come up with a lot of excuses and they're not good excuses.”

Richard Snyder served on United Way of Central Carolinas' executive committee in 2000 and said he doesn't remember any discussion about retirement benefits.

“It seems like somewhere along the line the ball was dropped,” he said. “I don't understand what the benefit package was supposed to be that wasn't being met….I don't ever remember discussing retirement benefits. We discussed salary and bonus.”

“The shame of it is the United Way is a good organization,” he said. “And unfortunately, they're going to be hurt by this…there are services in the community that won't be funded because of this.”

Diehl said the board's leadership approved King's retirement plan.

“She had no role in that,” he said. “She didn't ask for it. They offered it to her.”

Diehl often represents people in the spotlight. Clients have included Charlotte Hornets owner George Shinn and speedway mogul Bruton Smith.

Diehl said he expects that something is going to happen within a week. There are, he said, three choices: King can continue in her job; she can resign; or she can be fired.

“Those are the choices in any employment dispute,” Diehl said.

Diehl said he's negotiating with United Way's attorney. He would not provide specifics.

“We're negotiating about the situation and how it can best be solved,” Diehl said. “I think they need to honor Gloria King's contract.”

Staff Writers Eric Frazier and Mark Price contributed