United Way tax docs show inconsistencies

When paging through tax documents for Northwest Montana United Way in Kalispell and its affiliated nonprofit, Westside CCC, there are several noticeable inconsistencies among the nonprofits’ payroll taxes, volunteer numbers, salaries and more.

While some of these findings may not be considered egregious errors, they do raise questions as to the financial practices of the local United Way, its board of directors, and its former executive director, Sharon “Sherry” Stevens. In recent years, Stevens has had allegations of financial mishandling brought against her and the organization in the form of two separate lawsuits as well as claims from other nonprofit leaders.

With a handful of exceptions, filings for tax-exempt organizations are made public as a way to bolster transparency between those entities, taxpayers, possible donors and other stakeholders. This holds true for Northwest Montana United Way and Westside CCC, the name under which the Gateway Community Center of Kalispell is filed. Years’ worth of 990 tax forms for the two organizations that were submitted to the IRS can be found on websites such as Guidestar and Charity Navigator and for the most recently filed documents that are not yet available online, one can request that United Way officials provide them with a copy - a request that entities are legally bound to fulfill in a timely manner.

The deadline for nonprofit organizations to submit those documents for the year prior is on Nov. 15 every year, meaning sometime shortly after that date, those should be available for sharing should one request those documents. The Daily Inter Lake obtained the most recent 990 forms for both organizations after consulting with Kim More, legal counsel for United Way and Stevens, who provided copies within two weeks after they were requested.

Those were then compared to others dating back to 2014 to look for any inconsistencies among the forms over time.

One of the noticeable changes can be found within Northwest Montana United Way’s statement of functional expenses under the “payroll tax” line. Within four of the organization’s five most recent filings, the nonprofit’s total payroll tax expense ranged somewhere in between $16,000 and $22,000 depending on the year. But in 2017, only $1,388 was put down on the same line.

There are multiple possible explanations for the large drop in payroll taxes, with one possible answer being that volunteers put in significant hours that would have otherwise been worked by paid staff.

Another possible explanation would be a sizable dip in the total number of individuals employed during that calendar year. But the tax forms show 10 individuals were employed in 2017, which is only three less than those employed in 2016 when the organization paid nearly $21,300 in payroll expenses.

Along the same payroll vein, there are slight inconsistencies over the years regarding Stevens’ reportable compensation.

Tax forms from 2014 to 2018 for Northwest Montana United Way indicate Stevens was consistently compensated $32,160, with the exception of one year in which she made slightly less. That salary was also validated on Westside CCC’s 2015 form, when it was recorded that Stevens indeed was compensated that amount “from related organizations,” or in other words, from Northwest Montana United Way. But that was the only year her compensation appeared on the Westside CCC’s documents as a related reportable compensation.

That is until 2018, when it was recorded on Westside CCC’s 990 form that director Mary Jane Lowrance made the same $32,160 in reportable compensation “from related organizations” despite Northwest Montana United Way forms showing she made nothing.

As for specifics on volunteers, there are some oddities between the two organizations.

For Northwest Montana United Way’s 2016 form, an explainer section says “In the current year, 1,677 volunteers donated 16,099 hours of service; the Gateway Community Center project involved 1,888 volunteers donating 2,777 hours of service.”

But on the 2016 form for Westside CCC, which represents the center, the total number of volunteers listed was zero.

IT IS important to note that all financial records, according to United Way Board Chair Carol Nelson, pass through multiple hands before receiving the final stamp of approval.

She said the board of directors receives quarterly reports on the United Way, Westside CCC and fiscal agents. But before going to the board, they are “first provided to our finance committee for review by the executive director (Stevens) and then their recommendation is given to the board for final approval.” This same process applies tax filings, which the board receives and approves each year after they have been reviewed by the finance committee.

When asked if the board was aware of any inconsistencies in the documents, she said they were not.