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Oregon Kroc Center Facing Financial Problems

The Kroc Center in Salem, OR, has stepped up its fundraising efforts and is investigating ways to cut operational costs after seeing its membership figures drop by nearly half since summer 2010.

At its peak in August 2010, the Salvation Army-operated community center had 10,000 members. That number has now dropped by approximately 44 percent to 5,600 members, a quarter of whom receive financial assistance to cover some or all of their membership fees, according to a story in Salem’s Statesman Journal newspaper.

Last week, the Kroc launched a new newsletter to promote its Halo Club program, which asks nonmembers as well as members who can afford their fees to donate $15 per month or to make an annual gift of at least $180 to help fund the scholarships that allow low-income individuals and families to become members. Over the last few years, these scholarships have cost the Kroc $379,698.

To lessen the effects of the drop in membership, the $40 million facility also has had to make several operational adjustments, including eliminating jobs, cutting back operating hours and raising fees.

Kroc officials told the newspaper that they are looking to make additional cost-cutting measures and do not plan to fundraise for operational costs. Fundraising efforts for the scholarship program will target a new base of donors who are not current supporters of the Salvation Army in order to avoid pulling financial support from the organization’s social service efforts.

The Salem Kroc’s expenses for the 2009-2010 fiscal year were reportedly $10 million. A quarter of its annual operating costs is covered by a $35.5 million endowment, which was made possible through a posthumous gift from Joan Kroc, widow of McDonald’s founder Ray Kroc.

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