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Huge debt weighing down Urban League

The organization seeks help, particularly financial, to solve costly problems related to its Tampa headquarters.

By JUSTIN GEORGE
Published April 17, 2006

TAMPA - Crippled by about $3.1-million in debt, the venerable Tampa-Hillsborough Urban League, an 84-year-old institution that advocated change in segregationist America and in the impoverished lives of thousands, has put out an SOS.

"We are severely overburdened and any help is sorely needed immediately," acting Urban League president Darrell Daniels said. "I can't be more specific than that. Any kind of help, but more specifically financial."

This is the organization that pushed officials to create the county's first black high school and hospital, which it helped furnish. It urged Tampa police to hire its first black officer and gave black women scholarships to become nurses.

But the Urban League didn't help only black people. Carmen Grinan, 63, a Cuban, remembers being a single mother out of college at the age of 20 with no future prospects in sight.

She began working at the Urban League, learned to type and take shorthand and ended up with a business certificate that landed her a job.

Twenty years later, she sought the Urban League's help again, learned word processing, got another job and wound up getting a bachelor's degree. She was 48.

"You can be rich, downtrodden, poor, homeless, what have you, and they will help you," Grinan said.

But now it's the Urban League that seeks help. Its debt, according to a city of Tampa analysis, is owed to the Internal Revenue Service, a health care company, Wachovia Bank, the city and Hillsborough County.

Nearly half the debt, which derives from state or federal grants, would be forgiven once the Urban League finishes the renovation of its headquarters and completes some other requirements, including staying put for a few years.

The building is the Urban League's solution and problem. In 1999, the city gave the nonprofit the historic Centro Espanol de West Tampa building at 2306 N Howard Ave.

The organization said it wanted a home in the depressed neighborhood to help raise it up. But renovations didn't go as planned, former president Joanna Tokley said. What was supposed to be a $3.1-million project became $5-million after unknown structural defects were found.

"Had certain defects been known at the beginning," she said, "I think the story would have been much different."

The added costs led to a series of borrowing and financial overextending. The IRS placed liens on the agency for failing to pay payroll taxes; the Urban League's health plan was canceled after it missed premium payments.

Board members resigned. Checks bounced.

The Urban League staff dwindled to six from 49 two years ago, Daniels said.

Six of 10 programs were cut.

A $200,000 weatherization program that installed air conditioners, repaired windows, doors, ceilings and walls for the low-income and elderly was cut.

A housing program, which helped people find and finance homes, vanished after the city cut the HUD-funded program following a city housing scandal, which did not involve the Urban League. When the city righted its ship, the Urban League no longer qualified for the program, Daniels said.

State-, IBM- and United Way-funded job-skills training programs were cut.

The Urban League stopped applying for Department of Labor grants that funded a program that helps students with tutoring, college prep and field trips, leaving a handful of other nonprofits such as the Corporation to Develop Communities of Tampa to shoulder the burden, running similar programs, said CDC's president and CEO Chloe Coney.

But the worst cut, according to Daniels and many Urban League supporters, came after the United Way of Tampa Bay terminated $154,500 of annual funding in March 2005. The nonprofit's fiscal ill health led to the cut, United Way president Diana Baker said.

The money funded a hugely successful job-training program, Daniels said. But more important, the dissolution of the partnership sent out fundraising red flags.

"The United Way has supported programs that have had difficulties before, and they did not pull away," said Walter Smith, 71, former Florida A&M University president, who has a library named after him and counts the Urban League as a driving force behind his successes. "The moment the United Way pulled away from it, it was indeed a red flag.

"It said the Urban League was inadequate."

Supporters say Daniels, who ran many of the Urban League's programs for 17 years before taking over the entire organization, has been holding the league together the best he can. Not one check has bounced since he has overseen the league, he said.

The four programs remaining include two race-relations training programs, which reach businesses and churches and are funded by the city and county. A black-on-black crime-prevention program and a youth crime-prevention and intervention program funded by the state also survives.

But those successes are tempered by serious problems. The Urban League cannot withdraw $97,512 of Hillsborough County funding this year until it turns in a delinquent annual audit, said Eric Johnson, county director of management and budget.

The city is helping the Urban League find a solution. The league has proposed selling its building to get out of debt, and the city has heard from a handful of interested parties, said Cindy Miller, Tampa's business and housing development director. The city has asked for some concrete financial proposals from the parties, but no one has provided them.

State and federal money that went into the building's renovation poses the biggest obstacle to finding a buyer, Miller said. The grants stipulated they be used only for public service, such as the Urban League and other nonprofits. If the building goes to a commercial venture, the owner would have to pay back the grants, Miller said.

The city is also helping the league look for tenants to move into the building but rents would have to be huge if the league plans to recapture some of the renovation costs, Miller said.

Until the building issue is resolved, the Urban League cannot fix its fundraising problems and restore programs, city officials think.

"The renovations and the building construction work just took every dime they had plus they started going deeper and deeper in debt," said Fran Davin, Tampa's special assistant to the mayor. "The reality is: Until they can clear their decks of that serious debt problem, they aren't able to be successful in raising additional monies."

But money would solve a lot of woes, Urban League backers say, as would an infusion of leadership in the form of major business and community leaders who would join its board of directors.

"Right now, I think the league needs a great shot in the arm," said Tampa City Clerk Shirley Foxx-Knowles, former board member and league development director, "somebody believing in the league and putting the past in the past and making the best of the situation."

Curtis Stokes, acting Hillsborough County NAACP director, was part of an ad hoc financial committee last year that tried to help the Urban League. His group proposed that the nonprofit consider taking out loans that would be paid back with performance-based grants, so the league could get the money sooner. The group also told the league to call creditors and negotiate debt settlements just as a cash-strapped family would call Visa.

He thinks the league needs new blood.

"Start over and re-establish credibility," he said.

A " true" financial officer needs to clean up the mess, supporters say, and the link to the United Way needs to be re-established.

"What we need to do is re-establish that board with some heavyweights," said Sam Wright, a University of South Florida associate dean who ran past Urban League programs, "and get some clout back into it."

--Justin George can be reached at 813 226-3368 or jgeorge@sptimes.com

[Last modified April 17, 2006, 01:20:11]