The nonprofit UT Arlington Alumni Association, will disband in coming months because of financial problems, but the university will simultaneously launch its own program.
Patti Diou, a 1986 graduate of the university and president of the alumni association since March, said the nonprofit will consider liquidation and dissolution at a special meeting called for 10:30 a.m. Saturday in the University Center at UT Arlington.
Diou said the group doesn’t have enough money to operate the 3,000-member association after a loss in funding from the university. The group also has had difficulties raising money because both the association and the university were seeking money from the same donors.
The university will start its own “Alumni Relations” program under the Office of Development, Diou said. The university is looking to add a new position to its development staff with the hiring of a vice president for development and alumni relations.
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Regardless of what happens to the association, the university will honor member benefits such as free parking, event discounts and access to facilities, university spokeswoman Kristin Sullivan said. Special events such as the Distinguished Alumni Gala and mud volleyball Oozeball Tournament will continue in the fall as scheduled.
As far as the 14 alumni groups that fall under the association’s umbrella, such as the Architecture Alumni Chapter, Sullivan said the university will “continue to work diligently to engage all alumni and alumni groups in the life of the University.”
Diou said some of the financial trouble began in fall 2013, when UT Arlington President Vistasp Karbhari announced that the university would no longer pay for the human resources part of the association. At the time the association had seven full-time staffers, and 36 board members, which is now reduced to three staff members and five interim board members
In September 2013, Karbhari told alumni association board members the overall $139,700 the university contributed annually to the group — $105,000 for staff salaries and $34,700 for membership outreach — would be significantly reduced, on the advice of attorneys.
The university had been in talks with the UT System’s legal staff the past few years to see whether they could legally provide salaries and benefits to nonprofit employees, said Randa Safady, vice chancellor for external relations at the UT System.
UT System’s Office of General Counsel advised Karbhari it was “not consistent with best practices,” Sullivan said.
Safady said the practice is unusual. In fact, this past May, the system approved a rule that states universities should not share nor pay for staff with university-affiliated foundations. Though she said the rule was not directed at alumni associations, the president was “well within his rights” to apply best practices to the nonprofit.
So instead of entering into a new memo of understanding with the association, the university entered into temporary agreements and has paid $120,000 for expenses related to operational and programming costs for the fiscal year.
Neer Patel, president of the association from 2012 through February, said the alumni group had a two-day window to find a private firm to oversee human resources. On top of the $105,000 in salaries, the association had to pay $50,000 for employee benefits, he said.
The organization had previously received about 20 percent of its funding from the university toward its $800,000 annualoperating budget. Current board members declined to release the association’s operating budget to date, or how much the group would need to keep going.
Staff members of the group, which started in 1920 and became nonprofit in 1974, are paid with membership dues. The amounts range from $20 for recent graduates to $1,500 for a joint “life membership” package that includes invitations to exclusive events and other perks.
The association gives the university $5 for every paid membership.
Patel said Karbhari told the association in January he wanted to form a joint task force to improve the association and its alumni engagement.
Patel selected seven board members, including Diou, and Karbhari selected the other seven, including Arlington City Manger Trey Yelverton.
After a month’s evaluation, the task force recommended in February that the entire board resign by March 3, except for six task force members, including Diou, to help with reorganization efforts, according to meeting minutes.
Diou, an at-large board member at the time, said the board was too large to begin with, and the task force decided a reduction would be the “best possible thing for the organization, and for the university as a whole.”
Patel, along with 27 other board members, resigned two days later.
“I think it transpired in the most unfortunate way,” Patel said. “There was a lot of hard work that went into it. The money the university was giving they received back tenfold.”