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Organizations scramble to replace funds
United Way fiasco may hurt Sunnyvale Community Services and Senior Day Services
By Michelle Ku
Local agencies are scrambling for money after a faltering United Way announced that it may have to withhold an estimated $11 million from the member charities it normally funds each year.
Cupertino Community Services, Sunnyvale Community Services and Cupertino/Sunnyvale Senior Day Services are three of the local nonprofits that, come July 1, may not receive the funds traditionally earmarked for them by the United Way.
"I might need to cut back staff and serve less people," said Mary Ellen Chell, executive director of Cupertino Community Services. "The most vulnerable, the frail, the elderly, the low-income single moms and the working poor will be without help. We're the safety net for the people on the downward spiral."
United Way announced it would be unable to fund member nonprofits following the discovery that Eleanor Jacobs, the agency's former executive director, had distributed $11 million in reserve funds.
Since the announcement, companies and individuals have donated more than $7 million in emergency funds to the United Way to make up for the loss, but member agencies are still unclear as to what amount, if any, they will get. "It's a good start," Chell said. "We're hoping we'll get some of that, but it's not going to make it go away until they get the whole amount."
With less than two months to go before the beginning of the new fiscal year, the three agencies are now struggling to find replacement funding.
The United Way provides Cupertino Community Services with $52,000 annually (10 percent of its annual budget) and Cupertino/Sunnyvale Senior Day Services with nearly $19,000 (approximately 15 percent of itsbudget). Nine percent of the Sunnyvale Community Services budget comes from the United Way.
The agencies are evaluating their budgets to see if cutbacks need to be made to services or administrative positions.
"We would probably have to look at our expenses and probably end up with just not providing as many program activities that normally come out of operating expenses," said Raul Sanchez, executive director of Cupertino/Sunnyvale Senior Day Services.
Sanchez said possible solutions include voluntarily cutting back on his hours and putting a freeze on salary increases.
At Cupertino Community Services, Chell is searching for alternatives to staff and service cutbacks.
Chell is contacting groceries and other sources so her agency can continue providing emergency rent, food and utilities support.
A viable source of income for the agencies is fundraising.
"If 1,000 people in the community reach a little deeper in their pockets and send us a check for $50, we can cover [the loss of United Way funds]," Chell said. "Cupertino Community Services has a very good reputation in the community. We are cost-effective and we're able to leverage funds. For every dollar given to us, we're able to turn it into $2 worth of service."
Sunnyvale Community Services has three fundraisers scheduled for the next few months.
"We have very aggressive year-round fundraising," said Nancy Tivol, executive director of Sunnyvale Community Services. "We have three major fundraisers we were hoping to use to stock some money away in an endowment for the future, but unfortunately it looks like the emergency is here today."
Sunnyvale Community Services and Cupertino/Sunnyvale Senior Day Services have reserve funds they may also consider dipping into to help alleviate the loss of United Way funds.
Neither agency plans on depleting its reserve funds.
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Sunnyvale, California Since 1994
