The Kenai Peninsula United Way — a nonprofit that has supported local charities, senior centers and youth activity groups by fundraising on their behalf — will close on June 30, 2018.

In a Monday letter announcing the decision, United Way’s board of directors wrote that donations to the group declined 77 percent over the past eight years.

“Last year (the directors) had talked and considered dissolving the corporation, but the member agencies asked us not to do it,” Kenai Peninsula United Way executive director Sue Carter said. “Because in some instances we’re about the only entity they can go to here on the peninsula.”

Since opening in 1985, the Kenai Peninsula chapter of United Way has raised and distributed more than $12 million to nonprofits such as the Kenai Peninsula Food Bank, the LeeShore Center, the Kenai Peninsula Boys and Girls Club, the hospices of Homer and the central peninsula and senior centers in Kenai, Soldotna, Seward, Anchor Point and Sterling. According to their Monday letter, the group’s goal has been “to raise money by centralized, low cost solicitation of contributions for the support of qualified Kenai Peninsula charities” by redistributing 85 percent of donated money to member groups. This goal has been challenged by cutbacks in the oil industry — the source of the majority of the group’s funding — and internet-based donation options bypassing centralized fundraising.

The Kenai Peninsula United Way’s eight-member board responded by cutting operating expenses 50 percent. In 2016 they reduced their paid staff to one part-time executive director and moved their offices from a rented space to Kenai’s city-owned Beacon Building, for which the group paid a nominal lease. Also that year, they had what Carter called their “hardest meeting” to pare down their list of fund recipients from 27 to the present 13, based on what percentage of group’s funding comes via the United Way and how much United Way donors had designated for specific groups.

“When it reached a certain point, we said, ‘We want the money to go to our community, and if this is no longer the way people are giving, it’s time to get out of the way so that money can go directly to these people,’” board member Jeffrey Dolifka said.

The gradual decline of United Way contributions has softened the impact of their closure on member groups such the Kenai Peninsula Food Bank, said food bank director Linda Swarner. The United Way contributes approximately 5 percent of the food bank’s funding — a decline from 25 percent in the past, when United Way had given the food bank about $80,000 per year, she said. The food bank has compensated by scaling back hours and doing additional fundraising on its own.

United Way’s primary fundraising technique was to partner with local businesses, allowing employees to deduct money from their paychecks as a recurring donation to United Way. Many high-paid employees in Cook Inlet’s energy and oilfield support services industry made these deductions, and employers helped United Way solicit their donations with annual presentations in the fall. Carter recalls visiting oil platforms to pitch United Way charities to employees — an option that smaller member charities wouldn’t have had on their own.

“We were directly tied to a lot of the oil companies,” Dolifka said. “Those were some of our primary donors. Just like the state, when that all kind of crashed those big donors are obviously having to make tough cuts. ”

Some companies, such as Agrium, matched employee donations, Swarner said. But with declining oil and gas employment and the closure of Agrium’s fertilizer plant and ConocoPhilips’ LNG terminal, these contributions have shrunk. Charitable deduction options still exist for some companies, Carter said, but are now often managed by web-based third party services that don’t include the United Way’s local chapter.

Dolifka said a secondary cause for the decline is that “there are other ways to give now.” The group’s role as an intermediary is less necessary in a time when charities and individuals can solicit to mass audiences online through services such as GoFundMe, he said. Because of the way fundraising has changed since 1985, the Kenai Peninsula United Way’s announcement letter states that the board “increasingly find(s) we are in competition with our member agencies for the same donors and the same dollars.”

“There’s still people on the peninsula helping each other out, but they’re going about it in different ways than having one central entity that decides what charities to give out to,” Dolifka said.

Staying open until June 2018 will let Kenai Peninsula United Way finish its current fundraising campaigns. Afterward, the worldwide United Way organization may assign the Anchorage chapter to solicit and distribute funds for the charities formerly served by the Kenai Chapter.

Donors to the Kenai Peninsula United Way can either designate their contribution to a specific member charity or contribute it to a fund distributed to all the members by an allocation committee. If the Anchorage United Way begins serving these charities, donors will still be able to designate donations to Kenai Peninsula groups, but other funding to them may be managed more like grants.

United Way of Anchorage’s executive director Michele Brown said her group uses a different philanthropic model that gives undesignated donation money to groups according to how well they contribute to a set of organizational goals such as health, education, and housing. Whether or not the Kenai Peninsula groups will be included in this funding model remains to be decided between the Anchorage and Kenai United Way directors. 

“We’ll have to have a distribution plan we work out with them,” Brown said. “In the future, there probably will not be undesignated funds for the Kenai. Organizations will be by designation, because there isn’t an entity raising money for United Way on the Kenai any longer.”

Reach Ben Boettger at ben.boettger@peninsulaclarion.com.