Urban League fights to get itself in order

Scandal, income loss have dealt institution a series of blows

May 17, 2000|By M. Dion Thompson | M. Dion Thompson,SUN STAFF

Baltimore Urban League Inc., one of the city's venerable social organizations, is struggling financially and trying to raise money to balance the books and meet its payroll.

"I think there's no secret in town that we've been struggling to generate as much financial support as we can," said Lenneal J. Henderson Jr., chairman of the league's board of directors. "We're trying to raise at least $600,000 or $700,000 in the next several months."

All this comes as Roger I. Lyons, the league's long-serving president, sits at home, recovering from a mild heart attack and related medical problems. An acting replacement has been named to serve indefinitely, and Lyons' future with the organization is in question.

Reached yesterday at home, Lyons declined to comment.

Henderson blamed the Urban League's financial straits on the costs associated with owning and maintaining its headquarters at the historic Orchard Street Church, along with the loss of two grants from Lockheed Martin Corp. and money contributed through the United Way.

The biggest blow, however, is linked to the Urban League's involvement with Larry Young, who had entered into a lucrative consulting deal with the agency before he was expelled from the Maryland Senate in 1998 for ethics violations.

"That gave us some bad publicity that we did not need," said Henderson.

Federal prosecutors contended in a civil lawsuit that the Urban League and Young had "knowingly" submitted fraudulent bills and used falsified records to "conceal" payments to the federal government. The suit stemmed from two grants totaling $600,000 that the U.S. Department of Energy awarded to the Urban League in 1996 and 1997.

Last summer, with legal feesmounting, the Urban League agreed to pay a $40,000 fine and fund $157,000 in organizational changes to settle the suit.

"The tragedy of the Larry Young situation is that the U.S. attorney found no wrongdoing," said Henderson. "No one has lined their pockets. It was a tragedy to have that kind of impression given that we were somehow involved in a scheme to defraud the government."

Overhead costs associated with Orchard Street Church have also been an unrelenting financial burden. It is an expensive building to operate, and not just because of basic maintenance, heating and electricity.

"We have a very substantial mortgage," said Henderson, a professor at the Schaefer Center for Public Policy at the University of Baltimore. "We're trying to restructure that loan right now."

The financial problems stemming from the Young investigation, added to the upkeep of Orchard Street and the loss of grants, created "a large financial hole," said Henderson. Board members have been "beating the bushes for money," he said.

Henderson declined to say what the organization's annual budget is or how far into the red the Urban League has gone. He did acknowledge that the organization was having difficulty meeting its payroll.

Last week, the board named Howard Henderson, the Urban League's vice president for administration and development, as the league's acting president and chief executive officer for an indefinite period. He is no relation to Lenneal Henderson.

Lenneal Henderson said Lyons had a mild heart attack two weeks ago and "has been under a lot of stress and strain." He would not comment on Lyons' future with the Urban League.

"Right now, what we're concerned for is Roger Lyons' medical recovery," he said. "Everyone on that board recognizes the enormous contribution Roger Lyons has made to the city and to the Urban League."

Lenneal Henderson also said board members are trying to find ways to give the Urban League a degree of financial stability that does not leave the agency dependent on grants. Their success could ensure the future of the institution, which was founded in 1924.

"What we need more than anything else from the community is their financial support as well as their political support," he said.

"Far from being pessimistic, I would say that the assets that we have are a very, very strong board, a very strong staff and we also have a network of support in the community from Congressman [Elijah E.] Cummings to the Abell Foundation and they're not going to let the league fall," he said.

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