0
Votes

Two United Way Board Members Weighing Future Involvement

Concerns over alleged financial improprieties has National Capital Area organization on edge

Despite last week’s vote of support for United Way board president Gwendolyn Boyd and CEO Norman O. Taylor, at least two board members remain concerned about the United Way of the National Capital Area.

The board meeting was the culmination of six months of public and private allegations of financial improprieties and misconduct. These allegations — ranging from funds being mishandled and not used for purposes already designated, to not using professionally accepted accounting procedures — were made by a former United Way board member in a memorandum last July. Alexandrians Donna Kloch, a senior vice president of the board, and City Councilman Bill Euille, who was appointed to the board this year, both expressed concerns last summer.

“When I saw the memorandum, I called the president and suggested that we conduct a thorough investigation,” Kloch said. “I was hoping for a special board meeting in August, but that’s not what she decided to do.”

Boyd called, instead, for a meeting of the Finance and Administration Committee. That committee decided to discuss the matter at the regularly scheduled September board meeting. That meeting was postponed, however, because of the Sept. 11 terrorist attacks and was not held until October.

“At that meeting, I thought we decided to have an outside audit conducted, but there was apparently some miscommunication, and the attorney who was supposed to arrange for that audit thought we meant an audit outside our regular annual audit but that was conducted by our regular auditor,” Kloch said.

That issue was not clarified until last week, and now an outside audit will apparently take place. “That’s what we were told last week,” Kloch said. The audit is supposed to be completed within 60 days.

Euille also called Boyd this summer and suggested a thorough investigation of the allegations.

In an exclusive interview with the Gazette, Euille said, “Her [Boyd’s] response was certainly not what I would have hoped for. “I am very new to this board, so I have no opinion about Mr. Taylor or the allegations that were made by the former board member. What I do know, as someone who has been on a number of boards and commissions throughout the metropolitan area, is that it doesn’t matter who makes allegations of this type, they should be taken seriously and investigated promptly and thoroughly. That did not happen.”

Kloch agreed. “Rather than look into the matters when they were raised, anyone who raised concerns was chastised. The United Way is a great organization, but we are accountable to our donors and to those people we serve. We should be open, and there should not be this ‘circle the wagons’ mentality that I saw last week,” she said.

The Alexandria United Way, part of the National Capitol Area organization, has concerns over the allegations as well.

Kim Fiske, chairperson of the Alexandria United Way’s Executive Committee, said, “I just want to assure people that the Alexandria United Way is focused on its mission to disburse funds to local organizations and to safeguard the gifts of our donors,” she said. “We are concerned about the allegations and are waiting for the audit to be completed. If improprieties are uncovered and proper action is not taken, we will call for further action.”

STAYING THE COURSE

Euille cause a furor when he threatened to resign at the meeting last week. “We had been there for two hours, and I was very frustrated,” he said. “First of all, instead of dealing with the allegations, we were listening to board members and volunteers get criticized for expressing opinions that were different than those of the president. Then, we decided to go forward with the outside audit, which was the right thing to do, and someone decided to add a vote of confidence to show support for the president and the CEO. That was the final straw.”

Euille said that the issue of support or lack of support for the two individuals had not been discussed. “It just came up in the form of a motion, and I thought it prejudged the outcome of the audit,” he said. “I don’t know if I support them or not. I want to wait and see what the audit finds.”

Euille said that he has some reason to be concerned about what the audit will uncover. “One of the basic things that people do in business or in their own personal lives is to balance their monthly bank or financial statements,” he said. “Apparently, there was a six- or seven-month period when just this basic financial housekeeping task was not done. That certainly does not look good for an organization that handles millions of donated dollars a year.”

Kloch agreed. “Some of the allegations that were made by the former board member were also raised by our own auditors,” she said. “In light of that, I don’t see how anyone can call them frivolous.”

WHAT ABOUT DONATIONS?

Euille, who has raised millions of dollars for the organization, is concerned. In addition to sitting on the board, he is the chairman of the Alexis de Toqueville Society. That is a group of corporate and individual donors who contribute more than $10,000 annually. “I don’t see how I can go to people like Abe Polan and Michael Jordan and ask them for that type of money when the organization is not willing to take the steps to ensure that its house is in order,” Euille said. “It is very difficult, and every time I ask for money, I put my own reputation on the line by telling people that this is a good organization to give their money to.”

Mayor Kerry J. Donley has some concerns but a suggestion for donors. “It is very unfortunate that the board of the United Way of the National Capital Area did not move swiftly to investigate these allegations,” Donley said. “I can understand people’s reluctance to donate money in light of the recent events. However, our local United Way does very good work, and I would encourage those individuals and corporations who want to donate to the United Way to designate their donations to Alexandria’s community services fund. That will earmark the money to come into the city, where it will be well-used.”

Kloch supported this recommendation. “The eight community services funds are all very well-run,” she said. “Designating money to those localities is a good idea.”

Both Euille and Kloch hope to remain on the board. “I’m going to wait until the audit is concluded and see what action is or needs to be taken, and then I will decide,” Euille said. “I hope that everything is found to be all right or that there are things we can do to see that everything is in good working order.

"If, however, there are problems and they are not addressed, I will resign. I am an elected official, and I volunteer as a member on a number of boards. I do not have time to be involved in an organization that is not willing to be accountable to the public.”

Kloch will wait until the audit is complete to decide, as well. “I have been on the board for eight years and a United Way volunteer for many more,” she said. “I really hope that we can move forward in a constructive way. The organization does great work. After the audit is complete, I would like to see the board hold a retreat to discuss management issues as well. Perhaps there are things we can do to avoid our getting to this place ever again.”

The United Way of the National Capital Area is composed of eight local United Way organizations: two in Maryland, one in the District of Columbia and five in Northern Virginia.