United Way in Kamloops emerging from fiscal fall

The organization’s financial records for the year ending March 31, 2018, state the cash shortage is “primarily a result of consistent cash deficits from 2013 to 2018, which stemmed from not factoring in the true pledge loss when determining allocations to community organizations from the annual campaign.”

A cash shortfall has led to the local chapter of the United Way reducing its offerings to the community and undertaking a course correction in terms of its finances.

“Essentially, over the past 10 years, our United Way has funded more money than we received, and that was largely due to pledge loss,” said Danalee Baker, executive director of the United Way Thompson Nicola Cariboo.

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“We overestimated the money we could put out into the community, and this year was just a course correction,” she said.

That course correction has meant that this year, the non-profit-supporting organization has given out $400,000 less than it normally would, which has had ripple effects in the community and brought about some tough decisions.

Along with having less to offer Kamloops non-profits, the changes also include budget trimming and a new space on the North Shore.

Baker said the toughest decisions were in how to spend the reduced funds.

“We removed any new programs and any new organizations because we wanted to be true to those people we had funded last year and who were expecting funds this year,” she said.

The rest, Baker said, were decided on a case-by-case basis, with priority given to organizations that dealt with vulnerable people where a lack of funding might be as drastic as loss of life.

“And then there are organizations that were small and couldn’t survive without some money — such as People in Motion or the Chris Rose Therapy Centre for Autism. We made sure to give them something,” she said.

This year, the Chris Rose Therapy Centre for Autism will receive less than half of the $20,000 it received from United Way last year.

But the organization’s executive director, Wanda Carisse, said the funding gap is something United Way is trying to help them fill.

“We’ve been working this summer to try to find other grant avenues,” Carisse said.

“But there will be a future impact, in terms of the next couple of months.”

“We’re going to work really hard to make sure it doesn’t impact operations.”

United Way exterior
In September, the United Way of the Thompson Nicola Cariboo will move into space at The Station on Tranquille in North Kamloops. The agency 
has long been located downtown, but will be able to sublease space in the new development on the North Shore. - Dave Eagles/KTW

Baker said that case-by-case decision-making even led to some organizations declining funding for the year, either because they opted to go without or because they were in an all-or-nothing situation in which they would not be able to operate without all funds requested.

“It’s not all sunshine and roses, but everybody is committed to working together to support each other to get through this,” Baker said, noting the problem stretches back about 10 years.

The organization’s financial records for the year ending March 31, 2018, state the cash shortage is “primarily a result of consistent cash deficits from 2013 to 2018, which stemmed from not factoring in the true pledge loss when determining allocations to community organizations from the annual campaign.”

Baker said the problem arose due to the complexity of the organization’s finances.

When she became executive director in 2015, she hired a finance director and made changes in how the organization was managing things.

“Now we forecast very conservatively and also take off a 15 per-cent allowance just to make sure we’re not spending too much,” she said.

As the new executive director, Baker said she began in a difficult position.

On top of ongoing pledge losses, additional revenue was lost due to business disruptions from the commodity crisis at the time.

“There were a lot of layoffs from the mines and subsidiary companies. We saw a lot of corporations restructuring,” she said.

Baker’s predecessor, Brenda Aynsley, was the United Way’s executive director for 11 years.

In the summer of 2015, she left to become the United Way of the Lower Mainland’s vice-president of resource development.

Aynsley told KTW annual audits showed the organization was in good financial shape.

“So, every year, every United Way, as part of our membership agreement with the United Way of Canada, we have an audit conducted,” Aynsley said.

“It’s an extensive audit process and we have that done every year. And, every year, our financial position showed that we were in good standing. So, this narrative is not my experience.”

Aynsley said she does not know why or how the current fiscal situation emerged.

“I really can’t comment on what has happened in the past four years, but I am confident in the work of our auditors and that we were always in good financial standing,” she said.

“Pledge loss is something that you always have to take into consideration — and that is something that we have always done.”

Aynsley said financial records from her time as executive director did not show overallocation.

“United Way does tremendous work in the community ... and I just really hope that things can sort themselves out, but the financial records speak for themselves,” she said.

Baker said the local United Way collects donations via payroll deductions, so layoffs, retirements and even how vacation pay is given can have major impacts on revenue.

“Retirement has been huge for pledge loss, especially when people retire mid-year,” she said.

Despite the shortfall, Baker is optimistic about the organization’s financial health.

“Going forward, it’s going to be back to the good news,” she said, noting that $200,000 of the $400,000 shortfall has already been made up thanks to help from the organization’s funding network, leaning on organizations like RBC, New Gold and grants available in the community.

The United Way is also relocating to its new home in Kamloops at The Station, 280 Tranquille Rd. in North Kamloops.

Baker said the move will not only save the organization money by downsizing its space — from 3,000 square feet to 1,000 square feet — but also bring about an opportunity to generate revenue by subleasing to TRU, consultants and non-profits and by offering corporate and event rentals.

© Kamloops This Week

 


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