Detroit automakers’ losses cut deep into charities

PONTIAC, Mich. - As a charity that helps homeowners in a pinch, Lighthouse of Oakland County could use every penny it can collect as foreclosures and unemployment rise. But scratched from the 2009 calendar is its biggest fundraiser of the year — a black-tie dinner.

The event usually draws its biggest corporate sponsors. Problem is, they’re General Motors Corp., Ford Motor Co. and Chrysler LLC.

The automakers are scaling back their giving to agencies, organizations and programs as they become charity cases themselves. They’re bleeding billions as collapsing sales have led to big losses, forcing GM and Chrysler to seek emergency federal loans to survive for a few months.

The auto industry’s woes are being felt by nonprofits around the country. Among the scores of recipients nationally are the United Negro College Fund, Nature Conservancy and a women in jazz education and cultural preservation project.

Lighthouse expects corporate support to be down as much as 30 percent in 2009, said John Ziraldo, president and chief executive of the nonprofit that provides emergency services, affordable housing and homeowner education in Detroit’s northern suburbs.

Chrysler donated $24.3 million in 2007 — the last year for which figures are available — through its corporation and foundation. The company’s charitable giving for 2008 is expected to be roughly on par with that. But 2009 is another story.

Chrysler spokeswoman Jodi Tinson said the company understands that “one way or the other it’s going to be difficult for everyone.” Chrysler has kept its charitable commitments for 2008 even as its circumstances “kind of went to hell in a handbasket” in the second half of the year.

“As our fortunes are declining, the needs are rising in the communities we support,” she said.

GM spokeswoman Geri Lama said current conditions have forced its foundation to reduce or eliminate contributions to many causes. But she said the company will support communities and institutions “when and how we can.” GM’s charitable giving totaled $58.7 million in 2007.

Ford Motor Co. Fund President Jim Vella said the money it has to give next year also will be “significantly reduced” — at a time when he estimates community needs have increased.

In 2007, Ford and its foundation made $54.4 million in charitable contributions.

Decreasing donations is difficult for Ford, whose philanthropic efforts date back to founder Henry Ford, who said a sustainable business requires a sustainable society.

But efforts to do more with less continue with the company’s Volunteer Corps, formed in 2005 by Bill Ford Jr., Henry Ford’s great-grandson and current executive chairman of the automaker. More than 16 nonprofit agencies in southeastern Michigan recently received $5,000 apiece from Ford to buy food and other materials, and 700 employees and retirees volunteered their time at those nonprofits.

Vella expects greater emphasis on volunteer efforts and money for organizations’ short-term needs next year.

For some programs, however, the financial support is at least as important to their survival.

Chelsea High School’s robotics club has benefited from both financial and volunteer support, being so close to Chrysler’s proving ground near Chelsea and about 45 miles west of Detroit. The club builds and programs robots to compete in the FIRST (For Inspiration and Recognition of Science and Technology) Robotics competitions.

Chelsea’s team has seen its gift from Chrysler fall from $45,000 in 2006 to $25,000 in 2008, according to computer teacher Deborah Bentley.

“Chrysler, Ford and GM sponsor a majority of the teams, and all of the teams have (had) their funding cut,” Bentley said. “If we did not have Chrysler sponsorship, we probably would not have a team. There’s no way we could go out and raise that money.”

That’s a scary scenario for Wendy Zeilen, whose son, Cameron Beatty, is president of Chelsea’s club. She said for many students, it’s preparation at the right age for a career.

“This isn’t something you can just start in your mid-30s as a hobby,” she said.

“Where’s the funding going to come from?” she asked. “If the main contributors to many of these programs aren’t there and parents are looking at not having jobs, what’s going to happen?”

One of Lighthouse’s largest programs is working to prevent home foreclosure — in the state with the highest unemployment and one of the highest foreclosure rates in the nation.

November marked the fifth straight month of payroll job reductions in Michigan, with 103,000 jobs lost during that period. Total employment in Michigan has fallen every month since January, and the jobless rate is expected to climb into double digits next year.

For Ziraldo, there’s no fear Lighthouse will become a casualty of the charitable slump. But asking others to step up as the automakers scale back is hard as the life-or-death struggles of the region’s dominant industry penetrate the community.

“I think this is tough,” he said. “The prospects for 2009 are daunting. But I also know what kind of community we’re part of.

“In a crisis, we are very good.”