Charities Attract Union Opposition because They Supported Business Lobbying Group

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December 19, 2011; Source:  WLNE-TV (ABC6) | Sometimes, signing on with coalitions carries side effects nonprofits might not expect or want. In Rhode Island, a business-oriented group called EngageRI has led a well-funded effort for reforming the pension system of state workers. A number of nonprofits without much direct connection to the issue signed on to the EngageRI coalition, joining the likes of such business associations as the Greater Providence Chamber of Commerce (and other regional chambers), the National Federation of Independent Business, the Rhode Island Association of REALTORS, the Rhode Island Manufacturers Association, and the Rhode Island Mortgage Bankers Association. Labor unions representing state workers, such as the SEIU, were not happy with the business sector’s pension reform strategies.

But what was the homeless provider Crossroads doing on the list of EngageRI’s supporters? What was family services Rhode Island doing on the list (and its CEO, Margaret Holland McDuff, originally identified as Engage RI’s co-chairperson)? Maybe they were following the lead of some of their donors, or maybe they really supported the business sector’s solution to the state’s pension crisis. Or maybe they signed on because pension reform seemed like a good thing.

Whatever the motivation, the unions were not happy, and have apparently advised their members that donations to Crossroads, for example, would be donations to an organization that had “joined a group [whose] sole mission was to strip my members of benefits they worked very hard for,” according to Philip Keefe, the president of SEIU Local 580. The result is that donations to Crossroads are down about $100,000 this past October and November, compared to the same period last year.

We checked the EngageRI coalition list. Although Crossroads and Family Services have disappeared, we did note the continuing presence of nonprofits, such as two community action programs (the South County Community Action Program and the Comprehensive Community Action Program) and the International Institute. Nonprofits have the right to speak out on public policies whether supported by business interests or by labor, but the specific mission connection of these charities to EngageRI isn’t clear. For example, the International Institute provides educational, legal, and social services to immigrants and refugees, making its mission connection to state government pension reform somewhat questionable, but the composition of its large executive committee, board of directors, and board of advisors appears dominated by business interests that could well support EngageRI’s pension reform strategy.

Does anyone have a read on what might be behind the nonprofit membership in the EngageRI coalition and how the affected nonprofits are dealing with the opposition of the unions?—Rick Cohen

  • james dealy

    According to the unions’ analysis, some of the non-profit sponsors of pension reform had a direct self-interest in the issue. Some non-profits depend heavily on government social service funding. Several have grown largely as a response to state government’s outsourcing of its functions. In particular, behavioral health and, increasingly, child welfare programs that used to be state run are now being carried out by non-profit agencies using funds formerly spent on state agency staff and administration. Along with the funding has gone increasing levels of responsibility for nearly intractable social problems and decreasing budgets. These non-profits have become quasi-governmental beaurocracies, faced with the same “more for less” expectations as the public system. The severe governmental budget cuts of the last few years have forced cut backs in these agencies’ quasi-governmental programs, the more threatening to those agencies that are most invested in such programs. It may or may not have been any non-profit’s strategy to target pension reform as a way to protect its budget, as some unions claim. Nonetheless, state employees’ pensions are one of the few pockets of money left over from the days of the big state workforces. And pension reform has re-injected many millions of dollars back into the budgets of the state agencies that support these non-profits. It is reasonable to ask the non-profits who decided to support EngageRI what part their agencies’ self-interest played in their decision.