Arc afloat again

New executive director slashes nonprofit's debt, refocuses its priorities

By Scott Hewitt, Columbian social issues & neighborhoods reporter

Published:

 

ARC OF SOUTHWEST WASHINGTON

• Address: 6511 N.E. 18th St., Vancouver.

• Staff: 39 paid, plus many volunteers.

• People served: 5,000 is a “very rough estimate,” Executive Director Mike Piper said.

• Budget: $416,000 in 2013; that’s a huge drop from previous budgets that were well over $1 million.

• On the Web.

• Call: 360-254-1562.

Mike Piper's first labor as the new executive director of the Arc of Southwest Washington, early in 2013, was overwhelmingly symbolic: there were burst pipes in the women's restroom. Who's our maintenance guy? You are, he was told. So there he was on day one, in the bathroom with mop and bucket, cleaning up the mess.

That's been Piper's challenge ever since, he said: digging the beloved, historic and deeply hobbled human service agency — which has been serving people with intellectual and developmental disabilities since the early 20th century — out from under a mountain of debt, legal troubles and a widespread lack of faith that the Arc could ever be what it used to be.

The Arc of Southwest Washington won't be what it used to be, Piper and other officials said. Today's Arc is a smaller, lower-to-the-ground agency that has sacrificed its professional, therapeutic PRIDE for Children program — what many saw as the Arc's flagship program — in favor of strategic partnerships with other local agencies and a strengthened culture of grass roots peer-to-peer and parent-to-parent supports.

"We won't be going back to the clinical model," Piper said.

Surplus space in the Arc's headquarters at 6511 N.E. 18th St. is allowing the agency to provide affordable "incubation space" for smaller, like-minded startups and grass-roots groups, Piper said. If they've got cash flow, he said, they're asked to pay a nominal rent; if they don't, they don't.

Even better, pricey new telemarketing software has paid off, he said, hoisting fundraising efforts to the point where the similarly struggling sister Arc of Multnomah-Clackamas contracted with the Arc of Southwest Washington for a successful two-week test run earlier this summer, and offered to share its professional programs in return. While those discussions are underway, Piper said he is reluctant to take on anything new and ambitious.

Best of all, Piper said: The Arc finally has closed the sale of a long-vacant property it's been trying to unload since 2011. The Arc's former home at 9415 N.E. Fourth Plain Blvd., an isolated building hemmed in by state Highway 500 and cloverleaf I-205 exit ramps, has depressed the bottom line ever since the agency consolidated its operations on 18th Street. Now, the sale of the building has garnered the Arc $550,000 and an end to pointless mortgage payments, Piper said.

That sale has also allowed the Arc to refinance what remains of its mortgage on the 18th Street building at a far more favorable rate. By the end of this month, Piper predicts, the agency will have no remaining debt other than that refinanced mortgage.

"We overreached," is how Pat Jollota, a long-standing member of the Arc's board of directors, sums up the recent past. "It was a bit of hubris, I'd say. But now we have stopped the bleeding."

Retiring debt

Endless payments on surplus property were only half the trouble, Piper said. He said he arrived on the scene to discover that previous leaders had responded to earlier fiscal troubles with an across-the-board purge of professional staff. While there was wisdom in that, Piper said, it also drained the organization of crucial financial and management expertise.

"They just cut the top half right off," he said. The Arc now has 39 paid employees; in years past, it topped out at about 60.

Furthermore, there were serious legal problems. The Arc had fallen behind on payments to Kaiser Permanente, its health insurance provider, and to the state Employment Security Department to reimburse unemployment claims that were made against it. Jollota said the board didn't know about these problems until the place was without an executive director and Justin Myers, board president and a banker with US Bank, laid it all out for them.

"It was incredibly difficult," Jollota said. "Justin explained how we were going to have to juggle money and figure out who we could pay and who could wait." Some board members began to "drift away" from the fiasco, she said. "We were down to a skeleton crew. The meetings were grim. It was like digging out of quicksand."

Did You Know?

• The “Children’s Benevolent League of Washington” was founded in March 1936 by parents seeking educational opportunities and rights for their “retarded and deformed” children.

• The national Arc was formed in 1950, and civil rights legislation guaranteeing public education and equal access for disabled people followed in succeeding decades.

• According to a 2011 nationwide Arc survey, people with developmental disabilities still face serious barriers to mainstream life, including education, employment, services and health care.

Piper said he talked to more than one outside consultant who studied the situation — which grew as bad as $1 million in debt at one point — and told him he'd be smart to declare bankruptcy and shut the place down. But the embattled board was loathe to do that; eventually there was a loan from the state-level Arc organization to help make former staffers whole and to keep some programs going.

"We are going to make every one of our creditors whole," Piper said. "There are some burnt relationships with the Arc in town. We can't have that." If the agency in question had been any other than the beloved local Arc, he added, many more injured parties would have been ready to rumble.

Climbing out of deep and long-standing debt means that the agency is "respectable and competitive again" and can go after foundation grants and other new funds, Piper said. No grantor in its right mind is going to fund an agency that's only going to use the money to retire old debt, he said.

"We are in a position where we can build again," he said.

Out there

What gets built will be different from what used to be. Piper, Jollota and Darla Helt, who manages the Arc's adult programs, all agreed that Innovative Services Northwest is now the leading local nonprofit provider of therapeutic and early intervention services for developmentally disabled children. Helt said she frequently refers Arc clients to Innovative.

"They are not in competition," Jollota said. "There is room for both." Jollota believes that the very grass-roots Arc, supported largely by community donations, never should have been in the business of providing clinical services, which are highly regulated and expensive.

So the Arc is returning to its roots: peer and family support, political advocacy, community outreach. It's got a contract with the state to provide support for developmentally disabled people living in their own homes, and a contract with Clark County to help those same people get out into the community for both vital needs and recreation.

On Monday mornings and Thursday afternoons, for example, the Arc hosts a guided stroll along the Burnt Bridge Creek trail, also known as the Discovery Trail, which is right out its back door. Piper and his popular four-footed friend, Jackson, joined the group for chitchat and the mile-long walk on July 14.

"Just getting people out there," where they can experience nature, get some exercise and pursue friendships, is the core of the Arc's mission, he said. "The only real disability is loneliness," he said.

Chieko Erdmann and her 49-year-old son, Jeffrey, were along for the walk. Erdmann watched Jeffrey trade high-fives with another walker, a fellow in a Superman shirt who offered jokes and smiles as he sped past; Erdmann said her son "needs exercise. And it is good to communicate and find his friends."

Jeffrey can't go places on his own, she said. After a lifetime of chaperoning him, she is considering placing him in an adult group home for the first time. She has several other adult children, she said, and they all have their challenges that require her help.

"I am very tired," she said.

Incubator

The Arc continues to operate what's called a Representative Payee program, helping clients manage their budgets and bills, and a legal guardianship program for adults who cannot make safe, responsible decisions for themselves. Its specialists help parents and developmentally disabled individuals negotiate bureaucracies such as special education programs, Medicaid benefits — and the corridors of power in Olympia.

And it is developing a significant new sideline as an "incubator" of related grass-roots groups and activities, Piper said. The Arc hosts People First, a group that focuses on building self-advocacy skills, and numerous parent groups and activities, from political advocacy training to support for those with adult children still living at home.

A relatively new nonprofit called Autism Empowerment and another long-standing one, Homes for Independent Living, have both moved into Arc rooms that used to house physical therapy sessions and other kid-focused activities. (Homes for Independent Living has split into two smaller units, based on separate funding streams for different residents.)

"Parent groups and self-organizing groups are coming to us," Piper said. "Can we provide them space to grow and pay rent? Will they grow into independent nonprofits, or become part of what we do? Let's be an incubator."

Software, "call girls"

If there's another factor making a difference for the Arc in recent months, Piper said, it's the sweet combination of personality and technology.

The Arc is famous for being powered mostly by sales of used clothing to Savers, the parent company of the Value Village thrift shop chain, which contracts with the Arc and pays by the pound. Those clothes are donated by the community and collected by truck-driving volunteers whose routes are constructed by the so-called "call girls" who so pleasantly inquire whether you have any donations this time around.

But the dialing itself has long been done by computer software from a database of land-line phone numbers, Piper said. When the software started to crash earlier this year, he said, the Arc decided a major upgrade was worth the expense. Twenty thousand dollars later, he said, the Arc's new call-generating software — bringing those irresistible call girls to the public far more efficiently than ever before — has upped clothing collections by something like 20 percent.

"I had no idea that coming to the Arc would mean spending 80, maybe 90 percent of my time worrying about used clothes," he laughed.

The upgrade has even grabbed the attention of the Arc of Multnomah-Clackamas, Piper said, which is facing similar financial woes. That Arc, which serves the Portland area, has approached Southwest Washington's Arc to see how the two agencies might merge and build upon one another's strengths — with Clark County doing the clothes collection and revenue generation and Multnomah offering more professional services — but Piper said those discussions are proceeding slowly.

"We will talk and plan about it, but it makes me nervous," he said. "Seems like we are just now climbing out of a dark hole."

THE MILLION POUND CLOTHES DRIVE

One million pounds of used clothes would really help float the Arc.

This is the third summer in a row that the Arc has held a Million Pound Clothes Drive. In 2012 its two-month drive raised 339,000 pounds of donated clothing. In 2013 the drive expanded to five months and topped 838,000 pounds. The clothes are collected in the Arc’s warehouse and then sold to the parent company of Value Village thrift stores, which pays by the pound.

This is the summer the Arc figures on hitting its million-pound target, according to resource collection manager Wendy Kness. The first two months of the drive, May and June, raised nearly 345,000 pounds — and the official end isn’t until the end of September.

The Arc doesn’t just take clothing donations for resale; it also hauls away used cars, either to scrap or perhaps to repair. And it shares donations of furniture, household items, medical equipment and other miscellaneous stuff with its neediest clients and sister agencies such as Share. All donations to the Arc are tax-deductible.

Call Kness at 360-546-3158.