Wrongful Death

I read with great sadness about the death of Hull House in Chicago, after 122 years.  If you studied sociology, women’s studies, social justice, social work, or any related field, you quickly came to learn of Jane Addams and Hull House, which she co-founded with Ellen Gates Starr), and the legacy that each gave to this country.  (Although little was ever mentioned of Hull House’s co-founder).

To most, I am sure, this is merely the closing of yet another nonprofit.  Big deal.  To others, however, this is the demise of an icon.  Not the first settlement house in this country—that credit goes to the Neighborhood Guild, founded in 1886 on New York’s Lower East Side–it quickly became the model settlement house, and that which all others aspired to become.  There are few locally based nonprofits whose name is so well recognized beyond its service area.

Was Hull House’s closing inevitable? Are organizations, like people, destined to eventually die of old age? Clearly, the answer to both questions is a resounding “No”.  Being on the outside, I clearly do not have all of the evidence and know all of the ins and outs, so I rely on what I have read of the media coverage of this sad event.

What we know:

• On 19 January 2012, the Board announced that Hull House would close in the spring, with March as the targeted month.
• The very next day, the Board rescinded that projection and said the organization would close in a week as there were insufficient funds to pay employees beyond the end of January, and employee salaries were not their only encumbrance.
• In November 2011, employees received paychecks with seven days’ worth of pay instead of the usual ten days’. (The missing pay was received the following week.)
• Government funding of Hull House went from $40 million in 2001 to $23 million in June 2011, all while demand for services was increasing.
• Over the last three or four years, Hull House had been building millions of dollars of debt and missing its fundraising goal by at least $1 million annually.
• The closing was a shock to the 300 employees of Hull House who, in fact, unbeknownst to them, had lost their health insurance two weeks before their last day of work.

What I have to ask:  How do you announce the decision to close in two months time on the 19^th of the month, and then the very next day so, “Oops, no, we goofed! We have to close next week.”  What, in what I am sure was the extensive studying of the plight and exhaustive and rigorous analysis of the economics of the situation, changed in 24 hours?  Clearly nothing.  A decision to close any nonprofit is not done lightly; I know that.  There had to have been months, at least, of discussions by senior staff, the board, together, on their own, in the boardroom and parking lots, and everywhere else.  I am sure there was lots of handwringing.  But I have to wonder about the caliber of that effort if when the board finally went public with this heart-wrenching announcement it took less than 24 hours to announce a much earlier demise.  It absolutely must beg the question:  was this the caliber of effort put forth over the last several years that led to the 19 January announcement?  Such poor analysis that one day you determine there are sufficient funds to stay open for another two months and then over night realize, nope, it is just for one week? Not surprising, then, that Hull House is now closed.

When was the warning bell first rung? When was the trend first spotted? Seems to me that, minimally, the trend should have first been spotted in 2002, but I’ll cut some slack and accept 2003, when the staff and board saw the declining funding by the Feds.  What did everyone do then?  And by 2007 when the organization was no longer able to cover its operating costs, what did everyone do then?  As far as I can tell, it was business as usual.

The 990s from that period don’t suggest any reduction in the number of senior staff or their salaries.  If the 300 employees of Hull House were shocked at the announcement of the closure, it would suggest that there had been no other belt tightening along the way:  no closing of programs, shuttering of any of the multiple sights, no cutting back in the scope or depth of services provided.  It would appear, again based on what is available to the outsider, that it was business as usual until the last several months.  If the 300 employees were shocked by the sudden closure and unaware of the loss of insurance coverage, it means that the true state of the organization was a well-kept secret, nurtured by those at the highest level of the organization who waited to long to react.

I put the blame for this at the feet of the board and the senior staff.  I cannot second-guess as to what went on:  was the board not asking for or getting the right information? Was staff not being straight with the board?  Were all engaging in wishful thinking, hoping against hope, putting off the inevitable, hoping for that angel that wouldn’t let a legend die?  I’ve seen a lot worse happen in the upper strata of an organization.  But the bottom line is that they all had a responsibility to Hull’s mission and they all failed.

Even icons have to be well run and stewarded or they, too, will close their doors.  And if icons aren’t immune from the wears of time, then what organization is?  It is time to learn our lessons before they school us.