The United Way of Rutherford and Cannon Counties has announced the termination of its partnership with Cannon County REACH, due to the program's decision to not maintain a 501(c)3 IRS status.
The United Way enters into contract every fiscal year with each of its affiliated agencies and initiatives. This contract requires those agencies to "maintain its status as a nonprofit, charitable organization and to conduct its operation in a manner which neither will jeopardize the tax deductibility (of contributions to the Agency or United Way) under state and federal law nor the exemption under federal income tax and estate tax laws."
"We are saddened to be forced to end our partnership with Cannon County REACH as an affiliated agency of the United Way because we do recognize the valuable services it provides to the community," said Brian Hercules, President and CEO of the local United Way. "However, our charge is to operate an accountable, efficient, and transparent organization, which involves guaranteeing our donors the ability to classify their charitable contributions to United Way as tax deductible."
Cannon County REACH had originally been allocated $22,000 by local United Way volunteers in the spring of 2011. This allotment would have began to pay out on July 1, 2011, however with the organization not maintaining its 501(c)3 status, that funding will not be granted.
The United Way will reallocate those funds to compensate for the loss of the national Emergency Food and Shelter Program (EFSP) funding this year, which is granted to counties based on factors such as unemployment rates and poverty rates. Local organizations had the ability to apply for those funds during the spring of 2011 prior to learning from the national EFSP that Congress would not be appropriating funding to Cannon County during this phase.
"While this situation is unfortunate in terms of losing Cannon County REACH as a partner agency, a positive factor will be the ability to provide funding to local organizations who thought they had lost funding from EFSP this year," said John McLaughlin, Chair of Community Impact for the local United Way. "We are happy to be able to turn this situation into a positive result for other Cannon County organizations who are in need."
For additional information regarding United Way, including a listing of its affiliated agencies and programs, please visit www.uwrutherford.org.