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November 11, 2017

Where Does $100 to United Way of Asheville and Buncombe County, Inc. Go?

by Anne Paddock

When it comes to United Way, the basic question that most donors want to know is “how much of my donation goes to the organizations that provide health, education, and financial stability to members of the community.?” In other words, how much of my donation is awarded in grants to the local agencies? The answer depends on the community because United Way has more than 1,800 chapters worldwide. In North Carolina there are 54 United Way chapters with the United Way of Asheville and Buncombe County, Inc. (UWABC) serving about 250,000 people spread over 660 square miles in western North Carolina.

For the past 3 years, UWABC has awarded 59% (2013), 56% (2014), and 48% (2015) of total revenue in grants to local organizations.

Ten key pieces of information on UWABC include the following:

  • The UWABC is a non-profit 501 (c) (3) and therefore files an IRS Form 990 that details revenue, expenses, assets, liabilities, executive salaries, grants and more. The organization operates on a July 1 – June 30 year with the most recent IRS Form 990 (2015) reflecting the period July 1, 2015 – June 30, 2016.
  • The UWABC raised $5.2 million, most of which came from contributions, gifts, and grants.
  • Expenses totaled $4.9 million (94% of revenue), of which $2.5 million (48% of revenue) was distributed in grants to local organizations. The second largest expense was compensation to employees which totaled $1.5 million (29% of revenue).
  • UWABC has 49 employees. The CEO received total compensation of $131,000.
  • UWABC has $6.5 million in total assets, most of which is in land, buildings, and equipment ($2 million) – they own the land and building, pledges receivable ($1.6 million), a beneficial interest in an endowment ($1.4 million), and liquid assets ($1.1 million).  Liabilities total $2.7 million, most of which ($2 million) are allocations payable, leaving the organization with $3.8 million in net fund assets.
  • 47 grants greater than $5,000 were made with the largest provided to the YWCA ($194,554), Pisgah Legal Services ($178,115), Homeward Bound of WNC ($136,651), the YMCA of WNC ($133,460), Helpmate ($118,959), and Caring for Children ($101,599). Also notable are three grants totaling $80,000 to three United Way chapters in North Carolina.
  • UWABC provided a $15,000 loan to David Bailey for life insurance with no written agreement. The notes indicate the loan was paid in full the following year.
  • A staff member related to a board member – Elizabeth Allen – received $45,957 in compensation as an employee.

There are two ways to analyze expenses: by category (Grants, Program, Management, and Fundraising) or by specific line item expense which provides more detail. Both are provided below:

Expenses by Category (Grant, Program, Management, and Fundraising)

For the year ending June 30, 2016, UWABC reported category expenses as follows:

$1.7 million (32% of revenue):  Program Expenses

$0.5 million (10% of revenue):  Fundraising Expenses

$0.2 million (4% of revenue):  Management Expenses

$2.4 million (46% of revenue): Subtotal:  Program, Fundraising, and Management Expenses

$2.5 million (48% of revenue): Grants

$4.9 million (94% of revenue): Total Grants, Program, Fundraising, and Management Expenses

Based on the above information, $100 in revenue was spent as follows;

$100:  Revenue

-$ 32:  Program Expenses

-$ 10:  Fundraising Expenses

-$  4:  Management Expenses

-$ 46:  Subtotal:  Program, Fundraising, and Management Expenses

$ 54:  Amount Remaining

-$ 48:  Grants

$   6:  Amount Remaining:  To Fund Balance

As illustrated above, $46 of every $100 in revenue was spent on program, fundraising, and management costs while $48 was awarded in grants to organizations ($2 of which was to other United Way organizations in North Carolina and $1 to other affiliate United Way organizations).

Expenses by Specific Line Item

The line item expenses were reported as follows:

$1.5 million (29% of revenue):  Salaries, Compensation, Benefits, Pensions, and Payroll Taxes

$ .3 million (5% of revenue):  Office, IT, Insurance

$ .2 million (4% of revenue):  Investment Fees, Interest, Affiliate Fees

$ .2 million (4% of revenue):  Bad Debt Expense

$ .2 million (4% of revenue):  Advertising, Travel, Miscellaneous Expenses

$2.4 million (46% of revenue):  Subtotal: Salaries, Office, Fees, Bad Debt, Advertising, Etc.

$2.5 million (48% of revenue):  Grants

$4.9 million (94% of revenue):  Total Expenses

Based on the above information, $100 in revenue was spent as follows:

$100:  Revenue

-$ 29:  Salaries, Compensation, Benefits, Pensions, and Payroll Taxes

-$  5:  Office, IT, Insurance

-$  4:  Investment Fees, Interest, Affiliate Fees

-$  4:  Bad Debt Expense

-$  4:  Advertising, Travel, Miscellaneous Expenses

-$ 46: Total Salaries, Office, Fees, Bad Debt Expense, Advertising, Etc.

$ 54:  Amount Remaining

-$ 48:  Grants

$  6:  Amount Remaining:  To Fund Balance

Whether expenses are viewed by category or line item, the bottom line is that $48 out of every $100 in revenue is awarded in grants and this number has been declining for the past three years. $29 of every $100 is spent on compensation costs for the 49 employees (of which $7 was for fundraising staff, $3 for management, and $19 for programs which is primarily related to the award of grants). For those who want their donor dollars to go further, donate directly to the 44 (not the other United Way organizations) organizations listed on the 990.

To read the IRS Form 990 (2015), click here.

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