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L.A. Fund Drive Begins Thursday : United Way Faces Major Challenges

October 13, 1985|DAVID JOHNSTON | Times Staff Writer

Nearly a decade into an era when government has retreated from providing social services, creating increasingly fierce competition for charitable donations, the Los Angeles area United Way on Thursday will officially launch its annual fund-raising drive.

United Way Inc., which serves Los Angeles County and recently expanded into western San Bernardino County, hopes to gather $86 million in pledges for 1986, the largest amount ever sought by a single United Way in the century-long history of federated fund raising in America.

'Many-Fold Needs'

"We are asking people to respond to the many-fold needs of our community," said Walter F. Beran, vice chairman of Ernst & Whinney's 23 Western accounting offices and chairman of the Los Angeles area United Way drive. "United Way is a vehicle to ask the people who can to provide the means so that others can meet their basic needs in life."

Meanwhile, thousands of volunteers working for the 17 other United Ways in Southern California are seeking another $58 million in pledges this fall, nearly three-fourths of which will come from individuals and the rest from corporations. (See chart on Page 9.)

The efforts by all 18 Southern California United Ways to raise $144 million are part of campaigns by more than 2,200 local United Ways nationwide to gather about $2.3 billion in pledges.

Nationally, these donations will help support 37,000 of the nation's estimated more than 320,000 charities. The agencies that share in the proceeds provide direct services to about one in three Americans, whether they give or not.

About half of the money that United Ways raise nationally will go to two dozen agencies, including the Red Cross, health charities such as the American Cancer Society, youth agencies such as the Boy Scouts and the Salvation Army.

Assuming that this year's $86-million pledge goal is reached, for the year ending next June 30, the Los Angeles area United Way's three largest allotments of funds will be $10.6 million to the Red Cross, $9.9 million to operate United Way and more than $6 million to add to its surplus. These are the same three largest allotments as last year.

In recent years, United Way Inc.'s growth has been about twice the rate of inflation, allowing it to add new agencies, fund new projects and to allocate more money to reserves to provide for a rainy day.

Unique American System

The nonprofit organizations that share in this money form the core of a vast and uniquely American system that relies on private, nonprofit agencies, instead of government, to provide most health and social services.

The 1986 campaigns come as the United Way movement confronts growing challenges to find new legions of donors so it can mitigate government spending cuts and to adapt to meet the changing nature of American society, United Way leaders and critics both say.

Steady Decline Cited

A 1985 study by United Way of America, the movement's national trade association, concluded that United Ways must undertake major changes in order to raise significantly more money and reverse a steady decline in the movement's share of all donated dollars.

Allocating more money to a more diverse group of charities is widely seen by top United Way volunteers and executives as one vital change because it will give more people a stake in the financial health of their local United Way.

The graying of the populace, immigration and the growing number of families in which one or both parents work outside the home are creating demands for new types of social services and new charitable agencies.

These social changes are, in turn, increasing pressures on United Ways to change the practice of guaranteeing sums to charities that are longtime United Way members or partners. This practice locks in most of each year's budget, restricts admission of new agencies and severely limits the sums that can be allocated to new members, regardless of changing social needs.

Locally, a committee of the Los Angeles area United Way, chaired by Terry W. McAdam, vice president of the Conrad N. Hilton Foundation, is studying future admissions of new member agencies, including how existing policies affect admissions.

United Way Inc. has admitted 73 new agencies in the past five years, including 18 in recent weeks, and expects to add more next April.

In Orange County, where more than a dozen United Ways have consolidated over the past 15 years into one United Way, 34 new agencies have been admitted since 1980.

'Donor Option' System

Complicating the picture is the growing number of individuals who take advantage of a "donor option" system, pioneered in Los Angeles, which lets donors specify which charities get their gifts.

Nationwide about 10% of all who sign up for United Way payroll deduction gifts choose donor option. In Los Angeles, the rate is about 6%, officials said.

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