Cash-hungry corporations shortchange United Way: charity fundraiser expects to fall $12 million shy of goal.

Cash-hungry corporations shortchange United Way

Charity fundraiser expects to fall $12 million shy of goal

Squeezed by a downtrodden economy and a closed-fisted corporate climate, the open hand of the United Way of Greater Los Angeles will hold $12 million less than its goal of $102 million for the fiscal year 1990-91. The anticipated shortfall was attributed mostly to the recession, rising unemployment and shrinking consumer confidence brought on by the Persian Gulf War.

Although the projected $90 million in contributions falls short of this year's goal, the figure represents the second largest amount ever raised by the fund-raising organization, which distributes funds each year to hundreds of area charities. But after last year's total of $93 million, the loss will mean cutbacks in giving and possible downsizing at the United Way itself.

"The United Way is a two-way street," said President Leo Cornelius. "Volunteers reach out to the community and then the community responds. This year, we said that $102 million was the minimum need and the community said that they could give $90 million."

And the minimum need is great. Last year, even with $93 million in its coffers, the United Way tapped into its reserve funds. This year, the well is dry.

"Our reserves are depleted," said Cornelius, "so we have no flexibility to try to be responsive to the needs of the community."

In fact, Cornelius predicted that based on the results of this year, expenditures will have to be slashed by 17-18 percent for the 1991-92 fiscal year. The reduction is expected to come in the form of fewer gifts and even cutbacks in the United Way's operating budget.

"We spend 15 cents of every dollar we raise," said Cornelius. Next year, the organization may have to trim the budget by $1.5 million. While "we don't want to retard our ability to raise money, 70 percent of our expenses are personnel-related," he said.

The $90 million raised reflects losses in six major corporate areas as contributions dropped for the year by close to $3.82 million, with a $1.67 million decrease attributed to the aerospace industry alone. Other industries also failed to match their gifts of the previous year. The entertainment field fell short by $650,000, manufacturing by $565,200 and banking by $472,900. The retail and telecommunications industries also gave less than expected.

To combat the lower figures anticipated in the future, the United Way will employ new strategies. While the organization will continue to target large corporate donations, Cornelius said that corporate support will probably not increase soon due to mergers and other current circumstances. So, the United Way will step up its focus on mid-and small-size companies to increase their giving.

"We would like to see them join with us," said Cornelius.