Thu, Nov 01, 2001 page5

• Red Cross to suspend its fundraising

  NEW DIRECTIONS Many charities are overwhelmed by the amount of donations coming in and now intend to focus on improving the distribution of those funds

  • NY TIMES NEWS SERVICE
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  American Red Cross officials announced Tuesday that they would immediately suspend fundraising for the victims of the Sept. 11 terrorist attacks, saying that the US$547 million pledged so far should be enough to cover the costs of the organization's immediate and long-term relief efforts.

  The announcement is a notable example of a shift among charities that are now focused less on collecting new donations and more on deciding how best to spend some US$1.2 billion already pledged to them. It also comes after days of increasingly angry complaints from families about the pace at which the Red Cross is distributing cash assistance.

  Meeting with reporters in Washington, senior Red Cross officials acknowledged that they had struggled "to find the right way to provide assistance to the American people," but defended their overall stewardship of donations.

  "Is it always perfect? No, it can't be perfect. That's what disasters are all about," said Harold J. Decker, who was appointed interim chief executive officer of the American Red Cross last week. He succeeded Bernadine Healy, who tearfully told reporters she had been forced out in part because of her handling of fund raising since the attacks.

  "We have learned an incredible amount about what we would have to do if this were to happen again," Decker said.

  Yet in a move that drew immediate criticism, Red Cross officials also revealed on Tuesday that the organization had raised so much in charity that it planned to hold as much as US$247 million in a reserve, some to cover unanticipated needs from Sept. 11 and some for victims of any future terrorist attacks.

  The decision to hold money in reserve, they said, was prompted by recent warnings from the Bush administration about the possibility of new attacks and by the growing numbers of people stricken by anthrax. "Usually a disaster has a starting point and an ending point," Decker said. "We're not sure that there's an ending point."

  But Eliot Spitzer, the attorney general of New York State, who had clashed with Healy over questions of how to coordinate the distribution of charity, said on Tuesday that donations should not be diverted from the victims of Sept. 11.

  "I'm of the belief that most individuals, if not all individuals, who made contributions in the aftermath of Sept. 11 fully expect those contributions to benefit those affected by Sept. 11," he said. "It is my strong belief that charities should honor that donative intent."

  Reacting to Tuesday's announcement that donations could be withheld for other terrorism victims, he said, "It doesn't yet raise a red flag or a red cross, but it does raise a question."

  In the past, the Red Cross has faced criticism and even legal action for using donations raised in response to one disaster to help victims of other disasters. But Red Cross officials said on Tuesday that they believed most Americans would support their decision to hold some donations in reserve so long as the money is ultimately spent on victims of terrorism, not floods, hurricanes or other natural disasters.

  "We think the clear distinction here is between acts of terrorism and acts of God," said Bill Blaul, a spokesman for the Red Cross. "I can't see a guy who gave us US$100 saying, `I don't want that money helping those three families of anthrax victims'."

  The decision to suspend fund raising was less controversial.

  "It's about time," said Daniel Borochoff, president of the American Institute of Philanthropy, a charity watchdog group. "They've raised far more than they need for what the advertising is asking for, which is the victims, the families and the relief workers."

  Some of the officials from other charities also welcomed the news, arguing that the scale of the Red Cross' fund-raising apparatus -- whose donations have been collected in thousands of convenience stores, bank branches and restaurants -- had impeded the efforts of smaller or less-visible charities.

  So vast is the effort that Red Cross officials said it could take days or weeks to bring it to a halt, or even to end all of its public service announcements. But by retreating from the fund-raising field, the Red Cross "opens up the opportunity for people to look at the longer term needs of these families, including the education, tuition and scholarship support," said William Nelsen, president of the Citizens Scholarship Foundation of America, a Minnesota-based group that is raising scholarship money for spouses and children of those killed on Sept. 11.

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