Tobacco charity raises misgivings; Nonprofits: A pilloried industry's assistance carries a moral burden, but it can mean survival for worthy programs

THE BALTIMORE SUN

When the Philip Morris Cos. launched a $40 million ad campaign recently promoting Virginia Slims to minority women, the YWCA of the USA joined a number of women's groups in strong condemnation.

But when the same tobacco manufacturer offered grants for domestic violence programs, the YWCA of Anne Arundel and Annapolis, a local affiliate of the national organization, applied and was awarded $10,000.

The contradiction illustrates the uncomfortable position of nonprofit organizations -- many of them serving poor people who spend some of their limited dollars on cigarettes -- that must decide whether to seek money for their programs from tobacco companies.

Philip Morris, a top corporate giver which makes half the cigarettes sold in the United States, has heavily promoted its long-standing commitment to charity in the past few months, advertising new multimillion-dollar initiatives to ease hunger and domestic violence. The corporation, which includes Kraft Foods and Miller Brewing Co., has contributed to arts projects and minority education for 40 years. Last year it gave about $60 million in cash contributions, with $17 million more in donations of food, and announced a new $100 million commitment to the campaign against hunger over the next four years.

The budget for the new television ads that in part promote giving? Nearly $100 million.

Competitors R. J. Reynolds Tobacco and Brown & Williamson Tobacco Corp. highlight their more modest charitable programs on their Web sites.

Despite its $246 billion settlement in 1998 with states to pay for the treatment of sick smokers, the tobacco industry remains under fire. In the past few weeks, the federal government and tobacco farmers have filed lawsuits against tobacco companies, and other suits are pending.

Public relations effort

Industry critics say that in this climate, highlighting philanthropy is strictly public relations for a beleaguered business.

"They are trying to make the American public believe they are a reformed industry," said Kathryn Kahler Vose, vice president of communications and marketing for the Campaign for Tobacco-Free Kids.

"In fact, they are a group of corporations that produces a product that when used as directed, kills. They're trying to divert attention."

Karen Brosius, director of corporate contributions and public affairs for Philip Morris, said the ads are designed not so much to promote the corporation, but to bring attention to the social issues involved. She said that has paid off, with nonprofits reporting that they've had offers of volunteer help and contributions from people who have seen the ads.

She acknowledged that the ads also round out the company's image. "I think one of the most important things we can communicate is that Philip Morris is more than a tobacco company," she said. "I think many people aren't aware of our activities."

At organizations like the local YWCA, the question becomes whether to be part of such a controversy -- or to forgo the chance for dollars not easily replaced.

At the YWCA, the Philip Morris grant will be used to provide transportation to job interviews and appointments for women who have fled domestic abuse -- a vital need for which funding is rarely available, said executive director Michele Hughes.

"Normally our positions are pretty much what the national's are," Hughes said. "In this case, we thought about it.

"There's a part of me that says, 'OK, these guys have this money. Let's take this money,' " Hughes said. "There is another part of me that says, 'This is really a problem.' But I also have a major problem with saying to the women whom we serve, 'We can't serve you in this way because we are too good to take tobacco money.' "

Baltimore's House of Ruth ended up "reluctantly" applying for a $25,000 Philip Morris grant for food for its shelter after a lengthy discussion, said executive director Carole Alexander.

A similar debate took place about a decade ago, Alexander said, when Playboy magazine was offering money. In that case, the House of Ruth did not apply, though Alexander is not sure why.

She said there's no denying that Philip Morris has brought attention to issues that are often ignored. "It's publicity that no program in the United States could afford to buy," she said.

"There's a political correctness issue being debated against a very pragmatic issue. Where do you get on the right side of this?"

Philip Morris' hunger grants last year included $35,000 for the Maryland Food Bank, to establish a training program that will help low-income people gain skills as they create meals from food donated by restaurants and caterers.

Bill Ewing, the food bank's executive director, said he has been impressed by Philip Morris' commitment to the program and by its knowledge about what the money should be doing.

"Could we have gotten other money? Probably," Ewing said. "But they're behind it. It's something they believe in doing, and they've been there supporting it. We got technical help on it, which was also really helpful. They showed us how to do it."

At the Maryland Institute, College of Art, Philip Morris provided a grant that provided graduate fellowships to minority students. Since that grant ended in 1997, the institute hasn't been able to find another source to continue the program, said Douglas Frost, vice president of development.

"The impact was huge," Frost said. "It made all the difference in the lives of 200 people."

Will giving continue?

With the industry paying billions for the toboacco settlement and watching stock prices fall, some wonder whether tobacco companies can keep giving.

At Philip Morris, charity has held steady for the past few years. "We are maintaining our commitment," Brosius said.

Brown & Williamson, the nation's third-largest tobacco company, has kept its giving at about $3 million a year for the past three years, said Joseph Helewicz, vice president of public affairs and chairman of the company's contributions committee. The company focuses its giving primarily on communities where it has operations, such as Louisville, Ky., and Macon, Ga.

Brown & Williamson has cut back on its sponsorships of community events. "We do have to watch budgets, and one company can only do so much in the community," Helewicz said.

David Howard, an R. J. Reynolds Tobacco spokesman, declined to speculate about whether the costs of litigation and settlement payments would eat into the company's corporate giving. The nation's second-largest tobacco company, based in Winston-Salem, N.C., gave more than $3 million last year to North Carolina programs.

But Howard said the company "is a solid, responsible corporate citizen and will continue to be in the future."

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