East County cancer center hopes to rebuild

 In his more than 30 years with Johnson & Johnson, Ron Gelbman has seen his share of crises. 

That experience explains why, even though he retired more than 10 years ago, the 67-year-old finds himself back working 14-hour days. 

It’s because he knows what to do.

But it’s not for a company, this time. In fact, he’s not even getting paid. 

Instead, Gelbman is working to save The Center for Building Hope, a nonprofit that helps cancer patients and their families. 

As the interim CEO of the organization, Gelbman is working with Carlos de Quesada, a retired business executive; and a local businessman, who prefers to remain anonymous, to help the center move forward by righting financial wrongdoings and regaining the trust of its staff members, volunteers, participants and community.

On July 31, the center fired former CEO Carl Ritter, after a newspaper report alleged that Ritter took a portion of each dollar coming in to the East County organization. And, although the center has struggled with debt for years, Ritter’s salary didn’t take a hit to help the center pay its bills.

According to documents filed with the IRS for the 2013-2014 fiscal year, Ritter earned $309, 575 plus $25,716 in “other compensation from the organization.”

Four of eight board members resigned when confronted with the news about Ritter’s misuse of his role, Gelbman said.

When longtime friend Veronica Brady, senior vice president for philanthropy of the Gulf Coast Community Foundation, called Gelbman on a Saturday afternoon to recruit him to be interim CEO of the organization, he said he was eager to help.

Two days later, he got to work.

Money matters

As Gelbman works to sort through the center’s problems, he’s faced with various financial obstacles.

In 2013 and 2014, the center’s expenses exceeded its revenue. Last year, the cancer center collected $3.3 million in revenue, but owed more than $4 million. Of the dollars allocated for expenses, no money went toward paying back affiliates, according to financial documents Gelbman provided.

To date, the center’s accounts payable is measured in hundreds of thousands of dollars, Gelbman said, and the center fell more than $787,000 short of covering its annual expenses, IRS filings show. 

Since Gelbman started at the center Aug. 3, no debts have been paid back, yet.

“We just don’t have the cash to pay those people right now,” Gelbman said. “But we hope to.”

In his first step to patch a broken financial system, Gelbman laid off 27 employees, he said. And, he doesn’t know if there will be more terminations.

“We owe a lot of people money,” Gelbman said. “Sometimes you have to make tough decisions, but don’t make them lightly.”

Those men and women worked mostly on the 130 to 150 National Traveling Shows Brides Against Breast Cancer operated each year.

The event required nationwide travel, lodging and other expenses that outweighed the revenue earned from sponsors, vendors and other proceeds from the show, Gelbman said.

Gelbman also asked for the three highest-paid employees in the organization to reduce their salaries.

They agreed on the decrease, which equates to thousands of dollars per year per individual, Gelbman said. He declined to disclose the specific amount.

The center’s board of directors is also creating a finance committee to work hand-in-hand with its next chief financial officer (CFO) on money matters.

Previously, the CEO worked closely with just the CFO, rather than a committee. Board Chairwoman Carol Ann Kalish believes the CEO had too much of a hand in financial matters, with few individuals to hold Ritter accountable for missed loan payments and other financial red flags, she said.

“It’s important for the CFO and CEO to feel like they have direct responsibility to answer financial hardship questions,” Kalish said. “A committee gives that person a multitude of perspectives and is another safeguard the CEO and CFO have to go through. There’s an opportunity there for those two to answer the hard questions.”

Gelbman is also planning a tri-fold approach of boosting the number of local events to generate interest; continuing to offer up-to-date resources through its free online resource for cancer patients and their families, healthsupportnetwork.org; and increasing its effort to generate donations.

Kalish estimates the center needs to raise at least $1 million more per year to pay back debts and continue offering current services to its more than 2,000 participants.

“It costs us $300 per participant each year,” Kalish said. “That’s courses and other resources we provide, for a pretty minimal cost. We need to bring in real money to move forward.”

Gelbman hopes honesty and being open about the center’s story of overcoming obstacles will speak to donors.

“I’ll own the mistakes and the rocky history,” Gelbman said. “I know they’re mad, and that’s usually the first step in the grieving process. But I’ll also tell them we’re making things right. Just because there was a scandal, doesn’t mean the entire organization should be painted with that brush.”

He hopes seasonal residents, who flock back to East County starting in September, will attend more Brides Against Breast Cancer events and will donate money to the group’s cause.

Without money, the center can’t fulfill its purpose, he said.

“No money, no mission,” Gelbman said.

Another possible answer for helping the center bounce back might include closing temporarily.

Mark Pritchett, senior vice president at Gulf Coast Community Foundation, which loaned the center $675,000 in 2011 and 2012, suggested the organization “go dark” to speed up recovery.

“During that time they could figure out a new direction, new name and new marketing strategies,” Pritchett said. “Closing for 60 or 90 days has been done locally, and sometimes it helps to stop the bleeding.”

Gelbman plans to keep the organization open, and isn’t considering closing the doors, for a week or forever, or declaring bankruptcy, he said.

He doesn’t know how long rebuilding the center will take, but he believes he and his team will have gotten the center more stable within a few months.

Rebuilding hope

While attending weekly courses at the center, center volunteer and participant Rich Reskow hears participants’ angry comments about recent occurrences.

But he doesn’t believe participants will stop coming, because of the more than 150 classes and daily services it provides.

Gelbman is also reminding staff members of honesty in the workplace, such as ensuring restricted grants issued for a specific purpose are spent on that purpose.

“My answer to most questions these days is, ‘What’s the right thing to do?’” Gelbman said. “And, I want the community to know that’s happening here.”

Improving public perception is a matter of creativity and a willingness to try new ideas, Gelbman said.

“I’m not guaranteeing anyone we will work our way out of this mess,” Gelbman said. “But I don’t think the end of the story has been written, yet; we’re going to try like hell to make the center go again.”

Contact Amanda Sebastiano at [email protected].