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Red Cross President Marsha Evans Resigns

The Washington Post

December 14, 2005

By Jacqueline L. Salmon

The American Red Cross, facing criticism for its Hurricane Katrina relief effort, said yesterday that its chief executive, Marsha J. Evans, has resigned -- the latest in a string of leaders who have struggled to guide the giant, often troubled charity.

Red Cross senior executives insisted that Evans's departure, effective at the end of the month, was voluntary. But others in the organization said Evans was forced to resign after her relationship with the 50-member board of directors deteriorated over issues of control of the $3 billion organization.

Chuck Connor, senior vice president for marketing and communication, said a "more precise" description is that the "board had concerns about her coordination and communication with the board." He defended her performance, however. "This place is in a lot better shape than it was 3 1/2 years ago" when she took over, Connor said.

Those who follow the organization say that, whatever the reason for Evans's abrupt departure, it is not good news for the charity, which has stumbled during some of the country's biggest disasters. From the way it distributes money to victims to its treatment of minorities and its handling of blood donations, the organization is facing scrutiny from Capitol Hill, civil rights groups, federal agencies and others.

Evans's exit "raises some serious questions about the mission and viability of the organization," said Rep. Bennie Thompson (Miss.), the ranking Democrat on the House Homeland Security Committee, who has criticized the Red Cross's response to Katrina. "Frankly, it is not clear to me that new leadership alone will cure the ills of the Red Cross."

Jack McGuire -- chief of the Red Cross branch that runs its blood services, which bring in the bulk of its revenue -- has been named interim president and chief executive, the organization said.

The announcement of Evans's departure came the same day that Congress convened a hearing to examine private charities' response after hurricanes Katrina, Rita and Wilma swept through the Gulf Coast states during one of the most destructive hurricane seasons on record.

That trio of monster storms unleashed a torrent of donations that reached at least $2.96 billion, setting what is believed to be a record for U.S. private philanthropic giving for a disaster relief and recovery effort, the Center on Philanthropy at Indiana University reported yesterday.

It tops the previous record of $2.8 billion for the victims of the Sept. 11, 2001, attacks and continues a trend of giant-size donations for giant-size disasters. Earlier this year, charitable giving for victims of the Southeast Asia tsunami reached $1.8 billion, a record for an international disaster.

In all three events, the Red Cross received most of the dollars. For this year's Gulf Coast hurricanes, it has garnered $1.82 billion, close to its eventual goal of just over $2 billion. With those funds, it provided financial assistance to 1.2 million families affected by the hurricanes, sheltered hundreds of thousands after the storms and mobilized 220,000 volunteers.

But members of Congress, civil rights groups and Katrina evacuees have criticized the Red Cross performance. They complained of long lines and lengthy phone delays when evacuees tried to get financial assistance from the organization. They also said the charity was insensitive in its treatment of minority evacuees. Evans's exit comes at a time when the Federal Emergency Management Agency is also under scrutiny.

Evans has said that the scope of the storms caught the Red Cross by surprise, as it did federal officials, and she has launched an initiative to increase the number of minority staff members and volunteers. She drew praise from Congress and others for her candor and willingness to work to resolve the issues.

But now those efforts could stall as the organization searches for new leadership, warned Paul Light, professor of public service at New York University, who has studied the organization.

In a letter to Red Cross employees released yesterday by the organization, Evans said she had been thinking of leaving after her three-year anniversary with the charity but stayed on to oversee its Hurricane Katrina relief efforts. Now, she said, "I look forward to spending more time with my family."

Board Chairman Bonnie McElveen-Hunter praised Evans's performance, including a reorganization at the Washington headquarters and a strengthening of local disaster response practices.

The 125-year-old organization has 820 chapters across the country. It is responsible for one-half of the nation's blood supply, which it collects and sells to medical facilities. It also is designated by the federal government as the front-line responder in national emergencies for providing "mass care" -- shelter, food and first aid -- for disaster victims.

Red Cross officials said yesterday that Evans's departure was not related to the charity's handling of its hurricane relief efforts.

Sources said the problems were similar to the issues that arose between a former chief executive, Bernadine Healy, and the board, which seeks tight control over the organization. For example, it participates in hiring and firing decisions by the chief executive and requires weekly fundraising totals.

Healy -- who was forced out in 2001, shortly after the Red Cross was criticized for its handling of donations after the terrorist attacks -- said the large board is a major problem.

There are "a lot of different agendas and different ideas of how the organization can be run, and this often leads to conflict and even intrigue on the board and conflict with management," Healy said.

She added: "This is a great, historical organization. The American people need it, and these kinds of issues need to be sorted out."

The Red Cross also faces difficulties in its vast blood operations. It has struggled to meet federal safety requirements and has been cited by the Food and Drug Administration on numerous occasions dating to the late 1980s for violations of federal safety standards, federal records show. In May, the FDA fined the blood program $3.4 million after fining it $518,500 in 2003.

Red Cross officials declined to say what kind of severance package Evans would receive.

Since the departure of Elizabeth Dole, who served as president from February 1991 to January 1999, the Red Cross has had four acting or permanent heads and has paid a total of about $2.8 million in severance, deferred compensation and bonuses to its former leaders, according to organization records.

Evans -- a former rear admiral in the U.S. Navy who served as executive director of the Girl Scouts of the USA before joining the Red Cross in 2002 -- was paid $495,000 a year, the organization said.

At the congressional hearing yesterday, Rep. Jim McCrery, a Louisiana Republican, assailed the Red Cross and called on Congress to consider whether to continue giving the charity a lead role in responding to natural disasters, the Associated Press reported. The designation gives the organization a substantial advantage in fundraising.

"If it is not the responsibility of the national Red Cross to step in when a Category 4 hurricane decimates a major metropolitan area and overwhelms one of their local chapters, whose responsibility is it?" McCrery asked.

Joseph C. Becker, senior vice president for response and preparedness for the Red Cross, told the hearing that the group did its best. "We chose to help those whom we could without delay, while striving to serve all who needed us," he said.

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