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© St. Petersburg Times, published November 7, 2001
WASHINGTON -- The American Red Cross defended its use of money collected after the Sept. 11 terrorist attacks, saying in a news conference and in a contentious Capitol Hill hearing Tuesday that Americans intended their donations to cover more than aid to victims.
The agency's explanation came as members of Congress criticized the charity's decision to devote some of the donated money to building blood supplies and responding to future terrorist attacks.
So far, $564-million has been raised for the Liberty Fund set up after the attacks, with $121-million already paid directly to families, the Red Cross said. In her congressional testimony, Red Cross president Bernadine Healy said families will receive about $300-million total.
The charity is establishing a $264-million reserve to pay for future terrorism-related response, such as the anthrax threats, once the needs of the World Trade Center and Pentagon victims are met, Red Cross vice president Bill Blaul said.
Healy -- and other Red Cross officials during a news conference held before the hearing -- said they believe their messages to local chapters and their public appeals made clear to donors that money would be used for family needs after the Sept. 11 attacks and for its "aftermath" and "emerging" needs. The need arises "because we are in a war," and to do less would be akin to responding only to Pearl Harbor without planning for the duration of World War II, Healy said.
"What's at issue here is that a separate fund was established for these families," said Rep. Billy Tauzin, R-La., pounding the table. "We are hearing from families that their needs are not being met."
Controversy over the fund was one factor in Healy's resignation.
Currently, victims' families receive three months of cash assistance from the Red Cross to help pay bills, although officials said they are considering an extension to six months. Since the attacks, 25,000 families have received the assistance, which averages $25,000 per household, the agency said.
Among those testifying was Russa Steiner of New Hope, Pa., whose husband, William, died in the World Trade Center collapse. Until Tuesday, Steiner -- who has three children in college -- had received about $1,300 from the Red Cross after applying Oct. 6.
However, hours before the hearing, the Red Cross gave her a check for about $27,000. "We screwed up," Healy said.
-- Information from the Associated Press was used in this report.