The American Red Cross of Greater Los Angeles, struggling financially despite an outpouring of donations targeted for tsunami relief, is planning to sell its Wilshire Boulevard headquarters.

Red Cross officials maintain that the move the second major asset sale in a year is being driven by a desire to operate more effectively and efficiently. But they acknowledge that the sale will help shore up the chapter's finances.

"We know it will reduce our expenses somewhat. We can free up dollars that are not in overhead," said chapter Chief Executive Roger Dickson, who said some of the money will go to bolster its reserves.

The building's employees would be sent to other offices. Just over a year ago, the chapter eliminated 29 positions to cut costs.

The Greater Los Angeles chapter is by far the largest Red Cross chapter in Los Angeles County, serving 6 million people in 36 cities through its headquarters and seven regional district offices.

Last week, the chapter reported an increase in revenue, to $19.3 million for the year ended June 30, 2004, from $14.6 million in the previous year.

But the revenues include $7 million in proceeds from the sale of a building on South Vermont Avenue that the chapter was leasing out. Without those proceeds, its revenue would have dropped 13 percent, to $12.3 million. At the same time, expenses rose 10 percent, to $19.7 million.

Non-profits across the country have struggled over the past several years as the economy slowly recovered from a recession and donations tailed off. At the same time, there is concern in the non-profit community about plans by the Bush Administration to cut social programs a big source of non-profit funding.

The situation has not been helped by a series of huge disasters, from 9/11 to the recent tsunami, which prompted a massive outpouring of financial support from Americans but which also has squeezed non-profits' budgets. The targeted dollars go to specific causes, making it harder for non-profits to raise funds for other operations.

Dickson said the tsunami was a "mixed blessing" but maintained that fundraising at the Red Cross chapter is on track this year. But he acknowledged the chapter finances were a factor in the elimination of 29 full-time equivalent positions in November 2003.

"We needed to bring expenses in line with revenues," he said. "We underwent a significant reorganization."

Dickson said the decision to sell the chapter's 48,000-square-foot Wilshire Boulevard building was the result of a six-month planning process in which the administration and board decided the chapter could operate better without its headquarters, home to 90 employees.


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