United Way chapters fear a new image disaster Ex-chairman seeks $4 million deal

March 30, 1993|By Knight-Ridder News Service

MIAMI -- Financially bruised United Way organizations across the country fear a new public relations disaster if the United Way of America agrees to a $4 million retirement package sought by disgraced former chairman William Aramony.

The United Way of America, the national arm of the nearly 1,400 community chapters, announced yesterday a special meeting would be held tomorrow in Dallas to discuss "a recommendation" on the demand by Mr. Aramony, the charity's former head who resigned under fire in early 1992.

But local United Way leaders are worried that a generous settlement will generate a backlash against their organizations, which saw donations fall last year when Mr. Aramony's activities became public.

"We are being shortsighted if we believe that any public relations plan, no matter how proactive and how aggressive, can quell the public outcry of a decision that appears to handsomely reward a man who is perceived as dishonest and as having stolen from the American people," wrote M. Anthony Burns, the board chairman of United Way of Dade County, Fla., in a letter to W.R. Howell, chairman of the United Way of America.

"The integrity of United Ways across the country is at stake and, if not handled with extreme care, the outcome of these negotiations could signal the end of our trade association," said Mr. Burns, the chairman and chief executive officer of Ryder System.

Mr. Aramony, 65, retired in March 1992 when audits found he had used the national office's budget to create a lavish lifestyle hardly be fitting a charitable organization. It included a $435,000 annual salary and benefits package, frequent trips aboard Concorde jets, chauffeured limousines and investments in condominiums and real estate.

In addition to an FBI investigation, the revelation ignited a firestorm of public anger against United Ways across the nation, depriving many of the contributions they count on to support community services. Nearly half the local chapters severed their ties with the national office for several months until major reforms were completed by the national office.

But Mr. Aramony, who rose from Miami's United Way office to head the United Way of America for 22 years, is seeking a severance and retirement package valued at $4.4 million, according to several reports.

The negotiations between a special United Way committee and the former director have been conducted in secrecy despite attempts by many local chapters to receive a full accounting.

"It's been gag-rule," complained Tony Focarelli, director of the California United Way. "They haven't shared anything with us in the field."

The surprise announcement of a meeting this week triggered fears that an overly generous settlement was about to be sprung on the chapters -- with potentially devastating result.

Betti Sands, president of the New United Way in Fresno, Calif., said she had sent several letters to headquarters echoing that concern. She said she understood Mr. Aramony was asking for $1 million in earned pension and another $3 million in other payments.

The United Way of America's headquarters did not respond to a call for comment last night.

But in announcing tomorrow's meeting, Mr. Howell said in a memorandum that "no final decisions" about Mr. Aramony had been made. And Mr. Howell insisted that any deal "will be made keeping the interests of the United Way system foremost in mind."

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