Salvation Army is part church, part charity, part business

People from all walks of life donate to the Salvation Army, assuming the money will help the needy.

And much of it does.

But the Salvation Army — embodied in the public's mind by the saintly street missionary in the film Guys and Dolls — is far more complicated and controversial than its heart-tugging television commercials would suggest.

Few donors realize the Salvation Army owns a $12 million Florida headquarters in Lutz, a $3 million office complex in New Port Richey and dozens of homes in the Tampa Bay area — all part of a largely tax-exempt local real estate portfolio worth about $75 million.

Officers, who are ordained clergy, live rent-free in the homes, including some that cost as much as $300,000. The organization provides them with cars, health insurance, furniture and Internet service. Its even pays the home­owners' association dues.

And the Salvation Army gets to keep much of its financial information secret because it is a church, though it gets hundreds of millions in tax dollars for the government-funded programs it operates locally and nationwide.

James Porter knew little of that when the Salvation Army made a cash offer on his 2,300-square-foot house in Tampa's North Lakes community, which has a fireplace and Jacuzzi.

He was happy to take the money. But "it just got me to thinking," he said. His bosses had never given him free use of a house.

Papers were signed. A succession of Salvation Army officers lived in the home, now occupied by Florida division chief Lt. Col. Vern Jewett.

And Porter stopped putting money in the red kettles.

• • •

The 145-year-old evangelical church helps millions who are victims of poverty, substance abuse and natural disasters — but it's also big business.

Law firms and public relations firms safeguard its image and brainstorm ways to bring in more money. Tax specialists find ways to keep the donations out of government hands. Real estate holdings add up to almost $4 billion nationwide.

Local donors were surprised last year to learn that then-Hillsborough Commissioner Jim Norman was on the Salvation Army's payroll to the tune of $95,000 a year and that his compensation included use of a car for work he said he did largely on weekends. It didn't help that the FBI was investigating Norman's wife's purchase of a vacation home with money from a wealthy businessman. Or that he was embroiled in a court challenge as he ran for state Senate.

Some donors swore they would never contribute again. Others dropped phony dollar bills with Norman's face on it into kettles.

Salvation Army officials say it was all a misunderstanding.

"If you tracked a dollar put in a kettle, it would not have paid one penny of Jim's salary, and it would not have contributed to this facility," Jewett said, speaking of the organization's 104,000-square-foot headquarters in Lutz.

When pressed for details about Norman's job last summer, officers said he helped attract and keep government contracts worth millions. But after Norman won the Senate election, he was forced into an early retirement.

Jewett's pragmatic decision — which he attributed largely to the new demands on Norman's time — was not out of character. The Salvation Army is very conscious of its image.

Its founder, England's William Booth, was considered a forerunner in public relations and branding. In late 19th century New York, Salvationists shocked more genteel churchgoers when they marched in the streets and played brass bands during worship service. Today, before a Sunday morning service in St. Petersburg, musicians still take the stage.

It's all part of the Army's folksy, humble appearance.

"They want to be able to project an image," said Daniel Borochoff, president of the American Institute of Philanthropy, "that they do this dedicated work for peanuts."

• • •

But it's not peanuts. And it's not necessarily the Army's money. The truth is that taxpayers foot the bill for a considerable amount of the Army's humanitarian work.

A domestic violence shelter in Pasco County is receiving approximately $30,000 this year in county funds, according to county records. Children's Village in St. Petersburg, which provides homes for foster children, received $250,000 from the Legislature.

Money comes from the state departments of corrections, health and education, adding up to millions, not including what the counties pay. After resettling Florida victims of several major hurricanes, the Salvation Army received a $1.6 million reimbursement from the Department of Children and Families.

Nongovernment donors — including holiday shoppers stuffing bills into the kettles — provide the greatest share of funds nationwide: $1.58 billion in 2009, out of total revenues of $2.86 billion.

Salvation Army spokesmen consistently say they spend 83 percent of their donations on programs and only 17 percent for administration and fundraising. That's about on par with the United Way of Tampa Bay, better than the American Cancer Society and not as good as the American Red Cross, according to Charity Navigator, a watchdog that bases its rankings on federal tax returns.

But you have to take the Salvation Army's word for it. The organization does not file with the Internal Revenue Service, claiming a religious exemption. Filing would set a dangerous precedent for other religious organizations, said Maj. George Hood, the Salvation Army's national spokesman.

As both a church and a nonprofit, the organization saves about $1 million a year in taxes on its bay area properties alone.

Some of the donated money supports the churches and officers. According to Hood, Salvation Army congregations tend to be smaller than typical churches and unable to sustain a large budget.

"It's not the kind of people that can tithe $1,000 a year or $2,000 a year," he said. "You're lucky to get $5 a week out of them."

Officer homes, which the Salvation Army said are bought with money from investments, wills and trusts rather than kettle money, have been the subject of controversy.

The Los Angeles Times reported last year that a Salvation Army officer was placed in a $1.3 million house in Santa Monica. Hood said that home was purchased decades ago for closer to $40,000, then renovated.

He said the organization was embarrassed by publicity in New England over several Salvation Army homes: one in Needham, Mass., valued as high as $900,000; and another in Holden, purchased for $350,000 with more than 3,800 square feet of space. The officer who lived there said he needed to retreat each day after working in depressed communities; and that city schools were not good enough for officers' children.

In the Tampa Bay area, Salvation Army-owned parsonages include three homes in upscale VillaRosa in Lutz and two in Carrollwood's Ventana. There are close to two dozen homes in all, many clustered around the state building in Lutz.

While an officer couple is typically paid about $30,000 a year, couples must file federal income tax returns that include housing and living expenses in their total taxable compensation. Because that amount can run about $85,000, Hood said the Salvation Army helps them pay the taxes.

"You can't say we live a meager lifestyle," Hood acknowledged. "Times have changed drastically over the years."

So have the work conditions. The Lutz building replaced cramped quarters in Carrollwood in what was once a home for unwed mothers. It has outdoor fountains, a wood-paneled lobby and handprint security scanners.

"This building, to me, is not ostentatious at all," Jewett said. The $12 million value is partly due to the building's need to withstand a Category 4 hurricane, he said.

The Salvation Army's Pasco county headquarters, a coral-colored complex of Mediterranean-style buildings in New Port Richey, raised eyebrows when it was built 10 years ago for an estimated $3 million.

"I'm told they said, 'This is a Taj Mahal,' " said Capt. Alejandro Castillo, the organization's top administrator in Pasco. "The Army, for many years, had managed money from legacies, wills and trusts. We owe zero on this building. We are honoring people who trusted the Army."

The officer housing arrangement is rooted in both tradition and practicality. By owning all this real estate, the military-style Salvation Army can dispatch officers anywhere it wishes with just four weeks' notice.

"This is one of the most inviting things about the Salvation Army ministry," Jewett said.

"The philosophy of the Salvation Army is to completely release me from the responsibility to buy houses, buy vehicles and provide these things for me and my family, and then frees me up to do what I'm called to do, which is to reach out in the name of Christ to people who are in desperate need."

• • •

The range of government-type services the Salvation Army provides, from probation counseling to utility assistance to emergency foster care, suggest a nondenominational charity.

In a quiet section of Clearwater, a triad of green-roofed buildings houses transitional apartments, a bread pantry and Alcoholics Anonymous meetings. In St. Petersburg, ex-convicts and others spend their nights at a homeless shelter.

All of these services, and more, are provided in accordance with this mission statement: "To preach the Gospel of Jesus Christ and to meet human needs in His name without discrimination."

In other words, the programs are inherently Christian even though some of their recipients are not.

The rehabilitative centers, which are supported by Salvation Army thrift stores, are emphatically faith-based and have worship requirements.

In the Clearwater center, those seeking help are routinely given a "nondenominational prayer request" form as part of their intake paperwork, said social services director Kip Corriveau. There is no pressure to fill it out, he said. But the ritual distinguishes the Salvation Army from other charities.

Hood suggested prayer is an option in any client-counselor relationship, although Jewett and state development director Steve Dick said the Florida programs are careful to observe discretion when there is government funding involved.

Ultimately, they said, it is impossible to separate the Salvation Army from its officers' devout faith.

"The people called to it give sacrificially," Jewett said.

He and Dick were both born into Salvation Army families. Neither felt called, as young men, to be officers. Both worked outside the organization before assuming leadership positions in the Salvation Army later in life.

"I'm a Bible teacher and a pastor, and I have a passion for the poor and the disenfranchised," Jewett said. "I would be sitting down in St. Petersburg on Fourth Street at our homeless shelter corps and working there if I had my choice. But I don't have that choice."

Instead, he is part of an infrastructure that, with each generation, becomes more sophisticated. Paid advisers help people write wills and trusts that name the Salvation Army as their beneficiary. A four-person legal staff handles myriad situations, some trivial and some severe.

"You wouldn't have the selfless service on the street to the homeless if you didn't have this headquarters and these people," Jewett said.

At the national headquarters, where Hood works, a similar impetus exists to boost the organization's image among a younger generation of potential donors.

It's no accident that the Salvation Army was frequently mentioned in media accounts of the 2010 earthquake in Haiti. In Washington, D.C., the Xenophon Strategies public relations firm put news organizations in contact with the Salvation Army, in part, to maximize exposure.

Closer to home, the organization sent out a news release to announce that its organization served more than 400 meals at a makeshift police command center during the Feb. 22 manhunt for the killer of St. Petersburg police Officer David Crawford.

Branding and marketing firms have been enlisted to help the Salvation Army appeal to the growing segment of society that lives on the Internet. In recent years the slogan, "Heart to God, Hand to Man," has been replaced with the more ecumenical-sounding "Doing the Most Good."

"Our competitors have said to me, 'My God, why didn't we think of this?' " Hood said. "It's a promise to America. We will do the most good with your contributions."

Clarence Harvey, a retired officer who was involved in an ill-fated effort to build a community center in Detroit, said the problems in the Salvation Army are not unlike those in other large nonprofits.

"It's the reality of the times in which we live, when the priority is raising the money to keep the organization going," he said. "Every big organization has a legal department. And there is the required medical insurance, all that entitlement. My biggest concern for the future of charities is when entitlements become greater than the services, and the mission is eroded."

Hood does not disagree.

"The harsh reality is that we can't do what we do today without money," he said. "The nonprofit sector has become so competitive. If we don't put our name out there and be bold about it, somebody is going to eat our lunch."

Marlene Sokol can be reached at sokol@sptimes.com or (813) 226-3356.

The Salvation Army at work

The Salvation Army is involved in a large number of humanitarian activities, many in partnership with federal, state and local governments. Here are some examples in the Tampa Bay area:

• In New Port Richey, the Center of Hope operates a bread pantry and a soup kitchen that serves about 100 daily.

• A transitional housing complex in Clearwater provides apartments for individuals who have fallen on hard times and are working or attending school.

• Children's Village in St. Petersburg offers long-term foster care to siblings who might otherwise be separated. Also in St. Petersburg, the Sallie House provides short-term placement for children who have been removed from abusive homes.

• At social service offices throughout the region, people can get emergency assistance with their utility bills.

• In Pasco County, the Salvation Army has run a domestic violence shelter since 1982. Support groups, a 24-hour hotline and limited transportation are included.

• Homeless shelters in downtown Tampa and central St. Petersburg provide temporary housing to individuals, including those who have been released from prison or jail.

• Children from low-income families or affiliated with the church attend Salvation Army summer camps. During the holidays, the Angel Giving Tree program provides gifts for children and seniors in need.

The Army's money

A look at the combined revenues and expenses for the Salvation Army's Tampa, Clearwater and St. Petersburg operations.

Total income: $18,931,685

Total expenses: $17,666,125

Surplus: $1,265,561

Source: the Salvation Army

About the Army

The Salvation Army traces its roots to 19th century London, where evangelical minister William Booth walked the streets to preach the Gospel to the hungry and homeless. He converted thieves, prostitutes, gamblers and alcoholics to Christianity.

The organization had a succession of names before members began calling themselves Salvationists and arrived in the United States in 1880. Its Florida headquarters is on Van Dyke Road in Lutz.

8,500: Estimated numbers of Salvation Army centers nationwide.

$100M+: The annual budget for its Florida operations.

1,600: Number of employees in Florida, including 725 in Hillsborough and Pinellas counties.

27,935 : volunteers statewide

114 : Number of officers (ministers), statewide

857: Statewide number of local officers (lay leaders)

162,022: Number of families given financial help last year

2,192,197: Meals provided, statewide

18,419: Florida families given help with energy bills

5,123: Number of clients in Florida's adult rehabilitation program.

87,633: Clients supervised by Salvation Army corrections officers statewide.

$2.86B: Nationwide revenues in 2009. Of that, 55 percent came from contributions that included holiday kettle donations, wills and trusts.

Source: Salvation Army

Salvation Army is part church, part charity, part business 03/18/11 [Last modified: Sunday, March 20, 2011 9:34pm]

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