Ever since the economy nose-dived, nonprofits all over town have felt the sting of sharp reductions in philanthropy. Many have laid off staff, others have closed. There has been one great exception: United Way of King County. Aside from a dip in revenue a couple years back, the pet charity of the Gates family has kept its income relatively steady at the level it achieved at the height of the dot-com boom. And what a level that is. Preliminary numbers for the fund-raising campaign ending last June show an income of $92.4 million—a few million behind the previous year but still almost double that of seven years ago. According to the Puget Sound Business Journal, the United Way ranks sixth among all local nonprofits in terms of revenue, right behind Seattle University. Its income makes it the largest United Way in the country.
So you might think that United Way would have little cause for soul searching. But the business-backed organization, funded largely through ubiquitous workplace giving campaigns and traditionally serving as a middleman between donors and service providers, knows it has a reputation as your "grandparents' charity," as a recent strategic report puts it. And it is troubled by a decline in the amount donors give United Way to use at its discretion. Increasingly, donors prefer to designate their money for particular organizations. That works fine for top picks like the Jewish Federation and the University of Washington but less well for an array of underrecognized nonprofits that depend on United Way for a good chunk of their funding. Consequently, even in a time of plenty, United Way has had to cut funding to groups such as Hopelink, which runs food banks and shelters on the Eastside.
To remedy the situation, "a new United Way" is being offered to the public, according to King County President and CEO Jon Fine. The organization has long stressed the business-friendly theme of accountability, telling donors that it will vet grant recipients to make sure their money is spent responsibly. Now the organization is promising not only responsibility but results, not only services to the needy but solutions to their problems. To concentrate efforts, United Way has picked two areas of focus: homelessness and early childhood.
"You can't just say, 'Give us money because we want you to give us money,'" Fine says in the stately former bank in downtown Seattle that serves as United Way's new headquarters. "You've got to say, 'Please give us money because we're solving problems.'"
Trying to make good on that promise has brought United Way into new territory. It is no longer content to be a pass-through agency, funneling money to others. "The United Way intends to play a more activist role," Fine says. It is initiating projects on its own, including one offering a kind of 401(k) account to the poor. United Way will match savings up to $2,000 with three times that amount for low-income folks wanting to buy a first home, to start a business, or to further their schooling. It is also doing things once considered too edgy— aligning itself, for example, with liberal advocacy groups like Real Change, which works on behalf of the homeless. In the past, United Way so avoided politics or controversy that it ended a 20-year history of giving grants to Planned Parenthood when the reproductive health organization started offering abortions.
"It's been a huge shift," observes Tim Harris, Real Change's executive director. "It really takes the United Way out of its comfort zone." He sees the organization wrestling with tricky issues, like, "How do you get the suburban community to be more a part of the solution?"
"Partner" agencies not involved with United Way's new priorities have worried that their funding will be cut, although United Way hopes the new focus will bring in extra dollars to keep that from happening.
Arriving at United Way five years ago, Vince Matulionis, director of the project on homelessness—dubbed "Out of the Rain"—has been in a good position to watch the organization transform. "The single thing that changed everything for us," he says, "was when we went from saying we were going to address homelessness to saying we were going to end homelessness." This idea had been circulating for some time nationally among housing advocates. But United Way was the first to start talking about it locally. The idea gained momentum when St. Mark's Cathedral held a forum on the subject a few years ago and the federal government started telling local jurisdictions that it wanted them to develop a 10-year plan to deal with homelessness. Hence was born the Committee to End Homelessness in King County, a coalition of nonprofits and government agencies that plans to release a 10-year plan for eradicating homelessness later this month. The plan will have some controversial elements, including emphasis on what's known as a "housing first" model, which would discourage providers from screening individuals with drug addictions and other problems, as commonly done.
Homelessness is not a cause business folks have tended to embrace. So it's noteworthy that the vice chair of the committee is Dan Brettler, chairman and CEO of Car Toys. Brettler sits on the United Way board, with Bill Gates Sr. , Molly Nordstrom, Seattle Mariners CEO Howard Lincoln, and a bevy of other power players. Housing advocates are watching to see if Brettler and United Way can bring in others from the business world. "You don't need every business person in the community," Brettler says. "You just need enough."
Will the advocacy community like what it gets if business becomes more involved? Initially, there was some grumbling about United Way's perceived naïveté as it approached homelessness. Seeing an emphasis on feel-good gestures rather than meaty system changes, some mockingly renamed the organization's homelessness project "Out in the Night." Even skeptics, though, say United Way has become more sophisticated as it has immersed itself. Few, moreover, can resist the tremendous resources and clout that United Way can bring to bear. If business' favorite charity wants in on social service activism, those in the field are saying, "Bring it on."