First of all, you've got to understand that the organization that takes in the money doesn't spend it. Four totally different organizations do that. Each of the four operates under a different mandate and has its own board, subcommittees and volunteer operations. Of course, the two largest of these organizations don't directly spend the money either; they pass it on in grants (each in a different way) to scores of direct-service agencies and organizations who use it for the people who need it. Altogether then, we're talking about one super fund-raising organization, two grant organizations, two allocating organizations, 89 sub-allocating organizations and 370 receiving organizations.

Welcome to the United Way in the metropolitan Chicago area. The operative word is complexity!

Ordinary citizens who contribute to the United Way appeal each year probably have visions of their donation dropping into a big blender where it is combined with thousands of similar donations, coming out smooth and creamy to be spread more or less evenly over the indigent population. Certainly the United Way's new symbol — a hand holding a tiny human figure surrounding by a rainbow — evokes images of simple, direct caring. And the all-pervasive United Way fund-raising campaign bombards the media each fall with heart-warming stories about what the money does when it gets where it's going, not the tortuous routes by which it gets there.

Bogged down in these complications, the disillusioned contributor may begin to wonder how services ever get through to the homeless mother, the recovering drug abuser, the retrainable factory worker, the suicidal teenager or the isolated senior citizen. Is there anything left after the trip through the bureaucracy?

The answer is yes, quite a bit — some would say in spite of system, some would say precisely because of it. Others would question whether the funds really benefit the people most need. Since its inception United Way has been dogged by the very qualities that make it work: its bigness, its close alliance with the corporate community, its friendly relationship with the oldest and largest social service agencies. Those dubious attributes have a special pertinence today when private sector giving is expected to carry a heavier load than ever before.

This year more than $73 million in United Way money will go for social services in the five-county Chicago metro area. (Chicago's sixth collar county, McHenry, does not participate.) That's less than the announced pledge total of $84 million. But fundraisers know from experience that about $5 million of what was pledged will never come in. Another $6 million or so will be spent on promotion and other operations of the fund-gathering and fund-distributing organizations. United Way's pledge that almost 90 cents of each dollar gets through to the clients is basically true and quite impressive; it is not uncommon nowadays for legitimate fundraising campaigns to allocate as much as 25 percent for overhead expenses.

The amount taken in makes the Chicago area effort the largest United Way operating in any single state. (The Tri-State United Way in the New York City area is the only one that takes in more anywhere in the United States.) Nevertheless, it should be kept in mind that United Ways here or elsewhere have no lock on social service funding. In most cases they supply no more than 15 percent of the budget of any private agency.

"I believe there is no system quite like the one we have here in Chicago," said Wallace B. Behnke Jr., vice chairman of Commonwealth Edison Corp. and one of those most responsible for the present form. "In our organization, I believe we're decades ahead of New York and most other places."

"When you look at the whole picture, it may seem a very cumbersome and inefficient way to gather and distribute funds," said Phillip A. Merriman, president of the United Way of Suburban Chicago. "And in some respects it is, but it's also a very effective way."

For even a superficial grasp of what this is all about and how it came to be, some fundamental explanations and distinctions are in order. The reader is advised to proceed cautiously, as through a mine field.

Consider first United Way/Crusade of Mercy (UW/CM). This is the highly visible money gathering arm of the entire operation. Every September UW/CM launches its yearly crusade with an avalanche of publicity. Thanks to its network of public relations specialists and media contacts, the area's social service needs and providers are discussed, dissected and dramatized. And a flock of eye-catching promotions, abetted by a volunteer army, extolls the joy of giving. Last fall, for example, a double-decker bus advertising the crusade, which toured the city and suburbs, generated more than 50 stories in local newspapers during a 10-day period.

UW/CM has a 42-member board, a professional staff of 100 headquartered in a suite of downtown offices, and a support network of some 5,000 volunteers. The bulk of the money comes in through corporate donations and employee contributions arranged through payroll deductions. The established goal, said UW/CM's President Jack Prater, is for everyone to give a "Fair Share," a somewhat fluid ideal based on a sliding scale. As presently constituted, those earning less than $15,000 are asked to give .4 percent of their yearly income; at the other end of the scale, those making $100,000 or more are urged to give 2 percent. The system works best, said John Rowley, operations director for UW/CM's public affairs division, when the appeal for a donation comes from a peer — that is, from someone on the same level as the giver. What UW/CM studiously discourages, explained Rowley, is a pattern of foremen or other bosses putting the bite on those under them, since that creates undue pressure and destroys the free will character of the campaign.

Companies which attain Fair Share goals are recognized with awards, banquets and publicity releases. Until a few years ago, "chief crusaders" (highly sucessful business volunteers) were presented little statues of a knight attired in full crusader uniform with a cross on the chest. That memento has been discontinued, much to the delight of the sizable number of Muslim and Jewish "crusaders" in the Chicago area, for whom the symbolism somehow seemed inappropriate.

When the money comes in, it is divided up and handed over to UM/CM's four "member" organizations. The largest of these by far is the United Way of Chicago (UWC). Of the $79 million actually collected by UW/CM in 1986, $50.4 million went to UWC, which allocates funds to 124 social service agencies working within the Chicago city limits. UWC gets the biggest cut because of Chicago's large population and its high concentration of social problems. It should be noted that UW/CM and UWC are not, as they might appear to be, two sides of the same coin. United Way of Chicago has its own 49-member board, its own staff of 47 in its own downtown suite and its own pool of 400 volunteers. But since it's not in the money-raising business, said its President Virgil H. Carr, UWC prefers a low profile. Until recently it did not even have a communications or press representative; inquiries about its work were routinely routed over to UW/CM.

To be eligible for a UWC grant, an agency must be nonprofit and in business for at least three years, must produce an annual fiscal audit and must perform the sort of services prescribed by UWC. Agencies interested in participating are required to first apply to UWC's membership and board committee, which makes a recommendation to the allocations committee, which makes a recommendation to the full board, which decides finally if the agency is worthy of UWC funding.

Meanwhile, UWC volunteer committees are regularly evaluating and reevaluating the changing needs of the area, and determining which deserve the highest priority. Currently, day care, job development, emergency services and physical rehabilitation are at the top of the list. Consequently, agencies concentrating in these areas are likely to get proportionally larger grants than others. However, big, established agencies like Catholic Charities of the Archdiocese of Chicago, the Jewish Federation of Metropolitan Chicago and United Charities of Chicago still get the largest grants — up to $4 million — not just because they are so large and old, said Carr, but because they respond well to the most pressing needs. Smaller and newer operations like Parental Stress Services or the Blue Gargoyle Youth Services Center usually get more modest sums — from $10,000 to $150,000.

Carr said there has been about a 15 percent turnover in agencies receiving UWC grants in the last five years. Some decide to leave on their own, while others are terminated, usually because of poor book-keeping or for failure to broaden their own fund-raising efforts.

Next there is the United Way of Suburban Chicago (UWS), which received $14.7 million from UW/CM in 1986. UWS has a separate 31-member board, a staff of 31 and a horde of volunteers beyond all numbering. Complicating the overall picture is the fact that UWS does not give its money to individual agencies, as UWC does. Instead, it allocates funds to some 89 independent suburban United Ways, and they — with their own boards and their battalions of volunteers — decide which agencies in their territory get the money, how much and for what purpose. This year 256 different suburban agencies are receiving funds through UWS.

Phillip A. Merriman United Way of Suburban Chicago

Jack Prater United Way/Crusade of Mercy(center) Virgil H. Carr United Way of Chicago(right)

UWS serves the populous ring around Chicago which includes some of the wealthiest communities in the nation like Lake Forest and Winnetka as well as some of the poorest like Robbins. President Merriman said there is no way one central allocator could determine the specific needs in such a diverse geographical spread. What UWS does is insist that each United Way associated with it do its own "community needs assessment," then select the agencies that can best meet those needs. This assessment program, which has been in existence since 1980, has done more than anything else, said Merriman, to make suburbanites aware of emerging trends and problems in their areas. Then, through a process involving decisions by five zone committees, an executive committee and finally the board of directors, UWS determines how much each suburban United Way will receive. The largest grantee in 1986 was the Evanston United Way, with the United Way of Chicago Heights close behind. Since a given social service agency may operate in several suburbs, it is entirely possible for it to receive several grants from several United Ways. In this way, a family and mental health center with offices in five south suburbs got the biggest snare of UWS money last year - $400,000. At the other end of the spectrum, a program for the elderly functioning in a single northern suburb received a grant of $360.

The other two members of the UW/CM immediate family are called "grant members" because they, unlike UWC and UWS, get to spend all the money they receive on their own programs. Mid-America Chapter of the Red Cross, which provides disaster relief and health and safety education services, received $7.4 million. The National Kidney Foundation of Illinois, a very new partner in the enterprise, was given $115,000.

Obviously, such an exercise in complexity did not begin that way; it had to be created over decades. Although federated or charitable fund raising has existed in the United States since 1887 (this is the centennial year), it did not get a foothold in Illinois until the Great Depression. Since then, the organizational form has changed almost as often as its name.

In 1932 the Governor's Commission on Unemployment and Relief coordinated the first, modest fund-raising effort. In 1934 came the Community Fund of Chicago which realized a substantial $3 million in its first year under the chairmanship of Inland Steel's Edward L. Ryerson Jr. Soon after World War II a separate Suburban Community Chest Council was established. Meanwhile, a new fund-raising group, the Welfare Council of Metropolitan Chicago (later known as the Council of Community Services) was created. Then in the late 1950s the Red Cross entered the picture as a partner of the Community Fund of Chicago in establishing the so-called "Joint Appeal." That appeal evolved into the Crusade of Mercy in 1959, which became the Metropolitan Crusade of Mercy in 1965 when the Suburban Community Chest Council joined up. Eventually the Community Fund and the Council of Community Services became the United Way of Metropolitan Chicago, which later turned into the United Way of Chicago. And the Metropolitan Crusade evolved into the the United Way/Crusade of Mercy. All these mergers and mutations, many effected during periods of crisis, help explain why the United Way is not a neat, cohesive structure. To be sure, United Ways are in operation all over the country — 2,300 at the most recent count, together raising $2.3 billion last year. And most have developed their own organizational quirks as they adapted to their environment and local needs. But the Chicago area operation is considered unique in that it is the only one with total separation between the fund-gathering and fund-allocating sectors.

Behnke said the division was created in the early 1980s as as part of a general restructuring which sought to make United Way '' more flexible and responsive." At that time he was campaign chairman of UW/CM and especially sensitive to the sharp criticisms directed at the United Way operation. The most persistent charged that United Way catered to the large, fossilized social service agencies and gave short shrift to small, less polished ones emerging from the grass roots. A major reason alleged for the inequity was the high percentage of conservative, establishment-oriented, white males on the various United Way boards. "There was a lot of truth in the charge," admitted Behnke.

The separation effort he spearheaded allowed one organization, UW/CM, to apply its full attention to soliciting funds, and others, especially UWC and UWS, to determining where the funds could do the most good. At the same time, Behnke and his supporters saw to it that United Way of Chicago underwent a substantial internal overhaul. Its board was reorganized to include more community leaders, social workers, teachers and plain interested citizens and to decrease the number of corporate boardroom types. In addition, a new president, Virgil Carr, was hired, and several new ideas were tried, including a Venture Grant program providing limited funding to new and innovative agencies which don't qualify yet for full membership. Some agencies which were deemed to be no longer fulfilling their mandate were phased out.

"These were changes whose time had come," said Behnke, "and I'm convinced they have made us more responsive — not perfect, but more responsive." UWC's Carr concurred, noting that 50 percent of his board and 60 percent of the staff are now minority and that 72 percent of all the services delivered by UWC member agencies are directed to disadvantaged people. More significantly, one-third of the agencies funded by UWC are controlled by minority groups. This represents a significant shift since 1973 when Arthur Kruse, director of UCW's predecessor, flatly rejected efforts to include more minority-controlled agencies in the fund. "I do not equate advancing race relations or attacking discrimination with backing black organizations," he said.

The present UWC administration was warmly praised by several social service agency officials for its support and responsiveness. "They've bent over backwards to bring good people to the board table," said Steven Nasatir, vice president of the Jewish Federation of Greater Chicago, a major recipient of UWC grants. "It's a better, more professional operation under Carr and his staff."

However, some social service agency representatives claimed the separation of organizations is unnatural and will prove detrimental in the long run. "You can't have people performing only one limited function," said an agency director who insisted on anonymity. "Fund raisers and fund spenders have to be blended or everyone gets tunnel vision."

Others complained that the organizational split between city and suburbs is also unnatural. "The future has to be based on a regional approach to social problems," declared another director. "You can't pretend that the problems in a suburb like Highland Park are unrelated to those in a city community like Hyde Park. We either sink or swim, but we do it together."

Indeed, a scan of the fastest growing services provided by agencies in both city and suburbs reveals a convergence of social problems. Throughout the metro area, day care for children holds a high priority, as do services for senior citizens teenage counseling and job retraining. It is by no means unusual now to find shelters for homeless teenagers or battered women in upper middle-class suburbs. And suicide prevention and pregnancy counseling services are mushrooming faster in the suburbs than in the city.

UWS's Merriman said discussions of metropolitan planning however laudable in theory, must yield to practical considerations. It is unrealistic, he said, to expect residents of affluent Lake Forest to be equally concerned with the issues in poverty stricken Robbins, 50 miles and a universe away. A major function of UWS, he said, is to insist that the care-providing agencies in both communities are doing their best where they are. In that regard, he noted that although the total number of agencies serving the suburbs has remained relatively steady since 1970, more than 50 percent of the old ones have been phased out and replaced, usually by more responsive newcomers.

Clearly, the absolute bottom line in any discussion of United Way is whether the millions of dollars collected are spent on the people who most need it, those who have fallen through the economic safety nets. Prater, Merriman and Carr said the participation of so many people in so many communities, arriving at decision through a maze of protocol and procedure, practically assures this since the best programs in the best social service agencies will be funded. "It would be a lot easier," said Carr, "for a few of us to sit here in the office and decide what goes where." The complexity of the system, he argued, provides needed checks and balances by involving in the process people who know their territory.

"The public knows we're effective," said Prater. "Thats why they give so generously to the campaign."

Despite restructuring, new programs like the Venture Grants, and an overall emphasis on flexibility, critics of United Way maintain the system is still so unwieldy that deserving agencies are regularly bypassed and the neediest people underserved. Four years ago an organization of black social service executives threatened to boycott United Way unless more funds were committed to smaller, grass-roots agencies. A Hispanic group made similar demands. UWC responed, but did not succeed in muffling the undercurrent of complaint.

Charges of inequality flared anew last March when a report on a monumental series of studies of Chicago area poverty was released. Titled "Hardship and Support Systems in Chicago," the studies had been conducted by the four largest universities in the Chicago area and supported by UWC along with of the largest local corporations and foundations.

The supporters were mightily offended when the report claimed that a miniscule 7 percent of welfare families in Chicago ever turned to a United Way agency for help. In addition, said the report, only 25 percent of private social service agencies in Chicago target powerless people as their primary focus; 33 percent of the agencies have little contact with low-income citizens; and some have begun charging fees for their service.

Prater said the criticism of United Way and its member agencies is entirely unfounded. In conducting the survey, he noted, researchers asked welfare recipients what their basic needs were and to whom they turned in time of need. Not surprisingly, the respondents listed food, shelter and clothing at the top of their lists, and only a handful said they had ever thought of approaching a United Way agency.

Yet, Prater pointed out, emergency assistance has never been a major priority of agencies funded by United Way. Ever since the Great Depression those services have increasingly been supplied by government, while private sector agencies, bolstered by United Way, concentrated on necessary support services like job training, counseling, day care and health education. It is therefore only to be expected, said Prater, that United Way agencies would not be regarded by the poor as their first line of defense in an emergency.

With the intense Reagan cutbacks in governmental social services during the last seven years, noted Carr, UWC agencies have been trying to increase their emergency service capability. And emergency service, in fact, is the fastest growing area of UWC emphasis in Chicago. Still, he said, the Illinois Department of Public Aid allocates more than $125 million a month in the metropolitan area, while United Way has less than $80 million to hand out for the entire year.

To beat United Way over the head for failing to defray government cutbacks is "nonsensical," Carr said. The pressure, he argued, should be on government to meet its legally manned and traditional role.

Carr and other United Way officials also took issue with the Hardship studies' findings as well as its methodology. United Way's own studies show that 69 percent of the people who receive direct services from UWC and UWS agencies are "economically disadvantaged," and almost half the UWC agencies' sites in Chicago are in the city's 200 poorest communities. The dispute, however, is not so easily resolved. The Hardship studies' findings "are indeed on target," said Dr. Sokoni Karanja, president of Centers for New Horizons and a member of the UWC board of directors. "They corroborate what some of us have been saying all along."

Karanja, whose organization has sponsored housing rehabilitation, youth training and day care for 17 years in the community near the Robert Taylor public housing project, said United Way's elaborate structure honors "restrictive covenants" which guarantee disproportionately large outlays to large, old and established agencies. He declined to cite these preferred agencies by name but said he does not see the major UWC recipients operating in his area, which has one of the largest concentrations of poor people in the nation. Karanja also disputed United Way's use of a higher standard than the federal government uses in determining who is "economically disadvantaged."

"United Way should take the Hardship studies to heart and look at them very carefully," he said. Prater vigorously rejected implications that "big" and "old" are dirty words and that "new" and "small" are always preferable. "I simply refuse to buy those stereotypes," he declared. "You have to look at these things on a case-to-case basis. A lot of discernment is needed."

In 1986 UW/CM set a campaign goal of $90 million. That they fell short of it by more than $5 million is not an indication of any public dissatisfaction, said Prater. Rather, it reflects the "economic downswing" in the Chicago area exemplified by huge layoffs by United Airlines, Sears Roebuck and other major institutional contributors. It also reflects a reduction in nonrenewable, one-time-only grants from other contributors. For the campaign beginning this fall, UW/CM has set a goal of $88 million — a figure Prater said is well within reach, the downswing notwithstanding.

So far most of the national health charities — the American Cancer Society, the American Heart Association, etc. — have preferred to remain outside the United Way umbrella in the belief that a narrowly focused fund campaign yields better results than participation in a generic one. UW/CM is nevertheless always trying to lure them into its big family association. Consequently, it would be unwise to engrave the present United Way organization in stone. "No one structure should be looked on as ideal or necessarily permanent," said Prater. "As in the past, United Way has to react to a shifting socioeconomic scene."

Whatever form United Way takes in the future, one thing at least seems certain: It will be very, very huge and very, very complicated.