Goodwill Shines in Recession

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Goodwill Shines in Recession

April 14, 2011

BY SAM TURLEY
THE PARTHENON

It's 2009, the recession is in full swing and John Stevens just lost his retirement money.

He walks into a Goodwill store for new jeans. He buys two pairs, tags from JCPenney still attached.

His total cost at checkout was $6.

Stevens has shopped at local Goodwill stores for more than a decade, he said, but in the past two years his visits have been more frequent.

“What would I do without Goodwill? Well, I’d have to wear more clothes with patches on them,” Stevens said.

“Sometimes an economic downturn will actually work to our benefit,” said Carter Seaton, marketing director for Goodwill Industries of
KYOWVA Area, Inc. “People will come here to shop when they can no longer afford somewhere else.”

Seaton said financial struggles during the recession have driven people to think differently about how and where they shop, and that change in shopping habits has driven more people to Goodwill.

“I can’t afford the name-brand things like I used to,” said Daniel
Benda, who said he has been shopping at Goodwill over other stores since the recession began.

Retail stores part of Goodwill Industries of KYOWVA saw a 5 percent increase in retail sales in 2010 – a new high for the organization.

Goodwill stores differs from other stores in the way they operate, because they resell items that have been donated. Profits from sales go to fund programs and services the organization provides, such as job training.

According to its 2009 IRS 990 form, Goodwill Industries of KYOWVA earns more than half of their overall revenue from their retail stores.

According to Guidestar,org, a website that specializes in nonprofits, a majority of charities saw a decrease in donations in 2010. The decrease first spiked in late 2008, when 52 percent of charities reported a decrease in donations, compared to 19 percent in early 2007. Charities cited ewer individuals giving and individuals giving as major factors.

In contrast, Goodwill Industries of KYOWVA saw an increase in both categories. In 2010, donations increased by 10 percent, and the number of donors grew by 22 percent, Seaton said.

The local increase is part of a national trend. According to a brochure on Goodwill.org, total retail sales for Goodwill nationwide increased 10.8 percent between December 2009 and December 2010. The organization also opened more than 100 new stores across the country.

In 2009, Goodwill Industries of KYOWVA made $6.9 million in revenue, according to their IRS 990 form. Gifts, grants and contributions to
Goodwill Industries of KYOWVA increased by $300,000 to $1.4 million in
2009, compared to $1.1 million in both of the previous two years.

The organization received $91,797 in funding from United Way of the River Cities, Inc. in 2009 – the second-largest amount of any organization funded by United Way that year. The funding was more than twice as much as the previous year’s funding of $41,297.

Seaton said the money came as part of grants for specific projects and partnerships with the United Way on services such as free tax preparation.

“We’ve been very supported by them,” Seaton said of United Way.

Their biggest revenue came from donated goods, which accounted for $3.8 million dollars in revenue, or half of their overall revenue.

The organization spent 82 percent of their total disbursements on program expenses.

“We’re not recession-proof, but we survive a lot better than most non-profits,” Seaton said.

Seaton said the only negative impact the recession has had on Goodwill Industries of KYOWVA is a difference in the goods being donated.

“Sometimes the donation pool isn’t quite as good as it could be,” Seaton said.

She said people hold onto things longer during the recession, which means the items aren’t in as good of shape, and people also shop at stores such as Walmart rather than Macy’s, so the quality of the items is lower.

However, Seaton said the quality of the items for sale hasn’t changed, but the amount of time required to sort through items has increased.

“We’re doing more culling,” she said. “In the stores, we still put the best quality out there.”

Benda said he if he didn’t have access to Goodwill, he isn’t sure how he would make ends meet.

“It’d be tough,” Benda said. “I’d have to learn to do without.”

Bleak Budget for Huntington

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BY SAM TURLEY

THE PARTHENON

As the country suffers through another year of economic hardship, cities across the U.S. are feeling the pain, and Huntington is no exception.

As the recession continues its impact, the city will have to cut funding once again - a trend over recent fiscal years.

In Huntington Mayor Kim Wolfe's proposed budget for the 2012 fiscal year, funding was cut across many of the city's departments, including layoffs of city employees and reduction in allocations across the board.

"With all that we have done and all the cuts that we have made, it has not been enough for us to weather this economic storm," Wolfe said in his 2011 State of the City address. "We must cut more and ask for even more sacrifice from our employees and our citizens."

In each of the past three fiscal years, the city budget has shrunk. In the 2010 fiscal year, the budget was $44.9 million. In the 2011 fiscal year, the approved budget reduced by 2.5 percent to $43.8 million. For the 2012 fiscal year, the budget proposed by Wolfe is $41.8 million, a reduction of 4 percent.

One of the biggest reductions in funding comes for the city's insurance programs. The proposed budget of $8 million is $300,000 less than the 2011 budget.

The proposed budget also included a reduction in floodwall funding, shrinking by $100,000 to $1.4 million.

Another cost-cutting measure in the proposed budget for 2012 is the layoff of eight city employees. However, under the proposed budget, Huntington City Hall will return to a 5-day workweek, but employees whose pay was decreased in a cost-cutting measure in last year's budget will not have their prior salaries restored.

The Cabell-Wayne Animal Shelter lost $100,000 in funding in the budget process. The shelter lost $25,000 in the 2011 fiscal year allocations.

One of the few areas that received an increase in funding is the city's budget for road paving. Allocation for paving is $1 million for the upcoming fiscal year, a 66 percent increase compared to the current fiscal year's allocation of $600,000.

However, one element not considered in the budget is the new municipal occupation tax, which will be implemented July 1. The tax replaces the $3 per week user fee, but the tax was not approved before Wolfe submitted his budget proposal.

Huntington is far from the only city facing budget cuts. Cities across the United States are also cutting funding because of a reduced budget.

"Nearly every public official in the country is being forced to make tough choices and decisions that affect the people they are elective to serve," Wolfe said in his State of the City address.

Utica, New York - a city with a statistically similar population size and demographic to Huntington - had to take $1.9 million from their rainy day fund in order to balance their 2012 fiscal year budget, according to the Utica Observer-Dispatch.

Larger cities are also cutting their budgets. San Diego is reviewing ways to combat a projected budget deficit of $56.7 million in the upcoming fiscal year, according to KGTV San Diego.

Although Huntington, like many other cities, is still suffering from the recession, MSNBC.com's Adversity Index shows hope for the city. According to the index, Huntington is beginning to enter an economic recovery mode, as is the state as a whole.

Police and Fire Sidebar

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BY SAM TURLEY

THE PARTHENON

Many city departments will face budget cuts in the 2012 fiscal year, and for Huntington's police and fire departments, cuts are nothing new.

At a Huntington City Council meeting on March 10, council members looked at the budgets of both departments and trimmed money to reallocate to paving funds. The council approved taking $100,000 from the police department and $90,000 from the fire department.

In the 2010 fiscal year, the Huntington Police Department received $11.6 million in funding. In the 2011 fiscal year, they received $11 million. For the upcoming 2012 fiscal year, the proposed allocation is 10.9 million.

The Huntington Fire Department has also had their budget reduced in the three most recent fiscal years. In the 2010 fiscal year, the budgeted amount for the fire department was $10.5 million. In the 2011 fiscal year, the adopted budget allocated $10.2 million. In the budget proposed for the 2012 fiscal year, the proposed amount is $10.3 million, a slight increase from the prior year. However, four vacant positions in the Huntington Fire Department will remain unfilled, a measure that is expected to save the department $65,000.

Ordinance and Rules Committee Meeting

The Charleston Ordinance and Rules Committee met tonight to discuss a bill for an increase in rental rates for the Charleston Civic Center and Charleston Municipal Auditorium.

A representative from the civic center said an increase was necessary due to the economic difficulties and an increase in operation costs, including a rate hike from AEP. He also said the charges were still in line with comparable cities, so he didn't expect the civic center or auditorium to lose business because of the expense of renting either facility.

The representative said the biggest cost comes from air conditioning. A committee member asked why the costs were so high, and the representative responded that it was because the A/C units were installed in 1980 and were inefficient from an energy standpoint, but were too expensive to replace at the time.

The committee voted to pass the bill unanimously. The bill will next be taken up by the finance committee.

Rules and Ordinance Meeting

I will be attending the rules and ordinance meeting tomorrow in Charleston.

I am not sure what the committee does, but their title sounds important which makes me curious about what will be discussed.

Huntington City Council Meeting

In tonight's meeting, the Huntington City Council voted to approve four surveillance cameras by the Huntington Police Department. Each council member voted in favor of an ordinance to expand the number of cameras the department has. One resident in attendance criticized the ordinance. He said he did not think the police department needed to spy on the city's residents, but that it what they would do with the cameras. He then when on a diatribe about what was wrong with the city, and at one point called Councilman Jim Ritter "a liar and a thief." Ritter became visibly angry and responded, "Do you want to take this outside, son?" The chairman told them both they needed to settle down immediately and told the resident there was nothing left for him to say.

At the beginning of the meeting, Tom McCallister, a Huntington resident, addressed the council about a sanitation board meeting he said he was supposed to be informed about. He said he stood in front of council at a previous meeting and asked about the sanitation board meeting, only to later find out that it had met without him knowing about it. The chairman said he agreed, and added that he (the chairman) "dropped the ball" by not letting McCallister know.

McCallister also criticized Mayor Kim Wolfe for not attending the meeting. He said the mayor has an obligation to be there. McCallister said the mayor has missed multiple city council meetings despite the fact the city charter says the mayor is supposed to be at all meetings. I thought this was interesting, and I would like to know exactly how many meetings the mayor has missed and exactly what the city charter says about mayoral attendance at meetings. I may look into it independently when I have the time, but if I were a reporter with the City Hall, Mayor's Office or a similar beat, I would research it as a possible investigative story.

Huntington City Council

I will be attending tomorrow evening's Huntington City Council meeting at 7:30 p.m. The agenda is available here: http://www.cityofhuntington.com/pages/aa-councilagenda.html.

From reading the agenda, I don't expect any heated debate or long discussions. Most of the issues on the agenda appear to be simple and to the point.