AP IMPACT: Some 9/11 charities failed miserably

By BRETT J. BLACKLEDGE and DAVID B. CARUSO, The Associated Press – Thu Aug 25, 6:27 am ET

NEW YORK – Americans eager to give after the 9/11 terrorist attacks poured $1.5 billion into hundreds of charities established to serve the victims, their families and their memories. But a decade later, an Associated Press investigation shows that many of those nonprofits have failed miserably.
There are those that spent huge sums on themselves, those that cannot account for the money they received, those that have few results to show for their spending and those that have yet to file required income tax returns. Yet many of the charities continue to raise money in the name of Sept. 11.
One charity raised more than $700,000 for a giant memorial quilt, but there is no quilt. Another raised more than $4 million to help victims, but didn't account publicly for how it spent all of the money. A third helps support a 9/11 flag sold by the founder's for-profit company.
There are other charities that can account for practically every penny raised — except that all the money went to pay for fundraising, and not the intended mission.
To be sure, most of the 325 charities identified by the AP followed the rules, accounted fully for their expenditures and closed after fulfilling identified goals.
There have been charities to assist ill and dying first responders, to help families of the dead, to help survivors and to honor the memory of victims. And there are charities that revolve around the flag, patriotism, motorcycle rallies and memorials of all sizes and shapes.
But in virtually every category of 9/11 nonprofit, an AP analysis of tax documents and other official records uncovered schemes beset with shady dealings, questionable expenses and dubious intentions. Many of those still raising money are small, founded by people with no experience running a nonprofit.
• The Arizona-based charity that raised $713,000 for a 9/11 memorial quilt promised it would be big enough to cover 25 football fields, but there are only several hundred decorated sheets packed in boxes at a storage unit.
One-third of the money raised went to the charity's founder and relatives, according to tax records and interviews. The chairman of the board, an 84-year-old Roman Catholic priest, says he didn't know he was chairman and thought that only small amounts of money had been raised. He says he was unaware that the founder had given himself a $200 per week car allowance, rent reimbursement and a $45,000 payment for an unreported loan.
• There's a charity for a 9/11 Garden of Forgiveness at the World Trade Center site — only there's no Garden of Forgiveness. The Rev. Lyndon Harris, who founded the Sacred City nonprofit in 2005, spent the months following 9/11 at ground zero helping victims, relatives and first responders. He said he formed the charity to fulfill "our sacred oath" to build the garden. Tax records show the charity has raised $200,000, and that the Episcopal priest paid himself $126,530 in salary and used another $3,562 for dining expenses between 2005 and 2007.
Harris said he sees his charity's work as a success even if there is no garden at the site. "I saw our mission as teaching about forgiveness," he said.
• Another Manhattan 9/11 charity, Urban Life Ministries, raised more than $4 million to help victims and first responders. But the group only accounted for about $670,000 on its tax forms. Along with almost four dozen other 9/11 charities, Urban Life lost its IRS tax-exempt status this year because it failed to show how money was collected and spent.
• The Flag of Honor Fund, a Connecticut charity, raised nearly $140,000 to promote a memorial flag honoring 9/11 victims. The flag, which contains the name of every person killed on Sept. 11, 2001, is on sale today at Wal-Mart and other retail stores. But only a tiny fraction of the money from those sales goes to 9/11 charities, with most going to retail stores, the flag maker and a for-profit business — run by the man who created the flag charity.
The AP examined charities that received tax-exempt status from the Internal Revenue Service by promising to serve victims of the 9/11 tragedy, build memorials or do other charitable works in honor of the dead. The charities were identified using data maintained by Guidestar, a private database of nonprofits that the IRS recommends.
The $1.5 billion donated to these charities was in addition to the billions spent by Congress and states and established nonprofits like the Red Cross.
Most of the 9/11 charities fulfilled their missions, but the AP analysis found dozens that struggled, fell short of their promises or did more to help their founders than those affected by the terrorist attacks.

East Coast checks bridges, readies plans for Irene

By MARTHA WAGGONER

BUXTON, N.C. – From North Carolina islands connected to the mainland by just a handful of bridges to the waterlogged shores of New England, officials are calculating what they need to do if Irene becomes the first major hurricane to strike the East Coast in seven years.
They're scrambling to inspect bridges, dusting off evacuation plans and getting sandbags ready for potential floods. And considering where and when to move people out of harm's way.
"You have to recognize that you're living here on an island, and island living represents certain risks," said Edward Mangano, county executive in Long Island's Nassau County, where school buses were being moved to higher ground in case they're needed to evacuate residents to storm shelters. "And those risks appear now, at least, to be tracking toward us."
Irene could hit North Carolina's Outer Banks on Saturday afternoon with winds around 115 mph (185 kph). It's predicted to chug up the East Coast, dumping rain from Virginia to New York City before a much-weakened form reaches land in Connecticut. Finally, it should peter out in Maine by Monday afternoon.
Even without hurricane-force winds, northeastern states already drenched from a rainy August could see flooding and fallen trees.
"You want to go into a hurricane threat with dry soil, low rivers, a half moon," New Jersey state climatologist David Robinson said.
That is not the case. The Garden State has gotten twice as much rain this month as in a normal August, and high tide happens at 8 a.m. EDT on Sunday, when Irene might be passing by.
Early Thursday, the storm was thrashing the Bahamas with widespread damage reported on at least two southern islands. It was a powerful Category 3 hurricane with winds at 115 mph (185 kph). Forecasters said the winds will ramp up quickly over the next day and Irene was expected to blow into a monstrous Category 4 with winds at least 131 mph (210 mph).
Hurricane and tropical storm watches would likely be issued for parts of the Carolinas later Thursday.
While the storm's path isn't definite, officials are taking nothing for granted.
In Maryland, inspections of bridges looking for cracks in the support piers and other structural features found no damage, according to state transportation agency spokeswoman Teri Moss. In Virginia, with a southeastern corner that could be in Irene's way, cities along the coast are reviewing their evacuation plans, said Laura Southard, spokeswoman for the state Department of Emergency Management.
"If there is an evacuation, people don't have to go to Richmond or Williamsburg," she said. "They just have to get to higher ground. There are multiple routes out. Cities and localities work hard year-round on their plans."
North Carolina's Outer Banks, which look the likeliest to get a serious hit from Irene, have a long history of hurricanes, and building codes and emergency plans reflect that. Structures in the region are designed to withstand up to 110 mph sustained winds and gusts of up to 130 mph for three minutes. Evacuation routes are meticulously planned, down to the order in which counties hit the road.
Ocracoke Island, a tiny Outer Banks community, has already ordered visitors off, but it has special challenges since it's only accessible to the mainland by boat. Dare County ordered evacuations to start Thursday and Currituck County was weighing its decision.
Some of the region's most popular destinations rely on the ailing Bonner Bridge, which was built in 1963 and intended to last 30 years, to connect Hatteras Island to the northern Outer Banks. There's no other way to reach Hatteras except by boat.
The bridge handles about 2 million cars a year and the state DOT ranks it a 2 on its safety meter, with 100 being the highest, or most safe, designation.
"We're going to shift people and resources around to do what we need to do and keep the roads open," said North Carolina Department of Transportation spokeswoman Nicole Meister. The 2.7-mile bridge won't stay open if it's deemed unsafe — which happened during Hurricane Earl last year — but the state has an emergency ferry terminal ready in that case to get people off the island, Meister said.
Farther north, precautions so far were mainly wait-and-see as officials watched for developments in the forecast.
New York City officials had begun preparations to evacuate residents from low-lying areas of the city if necessary. The city's subway stations and tunnels would likely be flooded in places, and officials plan to shut the system down ahead of time to reduce damage to the infrastructure.
"The sense is that we're going to be facing a strong tropical storm" with winds of 40 to 60 mph, said Office of Emergency Management Commissioner Joseph F. Bruno.
But Bruno added that the city's agencies were preparing for a Category 1 hurricane with winds surpassing 74 mph and waters surging dangerously in low-lying areas. With five hospitals and nursing homes in the area, officials were readying to possibly evacuate the most frail and needy.
Roads and bridges in Massachusetts are likely to bear the weather in good condition, said Peter Judge, a spokesman for the Massachusetts Emergency Management Agency. But the agency is planning for flooding and is keeping an eye on the 3,000 public and private dams throughout the state.
The Office of Dam Safety regulates about half the dams in Massachusetts and earlier this year a state audit rated 100 of those owned by 62 cities and towns as unsafe or in poor condition.
For longtime residents of the Outer Banks, getting off the island isn't always the biggest problem.
"The problem is getting back on," said Mary Morgan, who works at the Lighthouse View Motel in Buxton.
Inland flooding can close roads for days in severe situations, making it impossible to get back on the island until the water level falls. That makes people who live here far more reluctant to leave than tourists visiting for a week.
"I am prepared to evacuate," said Jen Ray, owner of The Space Between, a boutique and espresso bar in Frisco. "I'm not sure I'm going to."

AP-GfK poll: Views on economy, Obama role sour

By TOM RAUM

WASHINGTON – Americans' views on the economy have dimmed this summer. But so far, the growing pessimism doesn't seem to be taking a toll on President Barack Obama's re-election prospects.
More people now believe the country is headed in the wrong direction, a new Associated Press-GfK poll shows, and confidence in Obama's handling of the economy has slipped from just a few months ago, notably among fellow Democrats.
The survey found that 86 percent of adults see the economy as "poor," up from 80 percent in June. About half — 49 percent — said it worsened just in the past month. Only 27 percent responded that way in the June survey.
That can't be good news for a president revving up his re-election campaign. Yet there are several hopeful signs for Obama.
Despite the perception of a weakening recovery, there has been no significant change in the number of people who say he deserves re-election: 47 percent as opposed to 48 percent two months ago. That's a statistical dead heat with those who favor a change in the White House.

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And more Americans still blame former President George W. Bush rather than Obama for the economic distress. Some 31 percent put the bulk of the blame on Obama, while 51 percent point to his Republican predecessor.
"I think Bush had a hand in it, too. Obama's not totally responsible," said Mary Parish, 68, of Troy, Tenn. An independent who voted for Republican John McCain in 2008, she said she doesn't believe Obama has what it takes to heal the economy. "He's a smooth-talking man. But he does not know what he's doing."
Obama also fares better than Congress in the blame department. Some 44 percent put "a lot" or "most" of the blame on Republicans while 36 percent point to congressional Democrats.
The gloomy economic outlook reflected in the poll, which was taken Aug. 18-22, follows a round of bleak government economic reports — on unemployment, the housing market and economic growth that fell below 1 percent for the first six months of the year. It was taken amid heightened worries of a new U.S. recession, fallout from a downgrade of the country's credit rating and a spreading European debt crisis.
As the public's outlook on the economy dips, so has approval for the president's economic stewardship.
More than 6 in 10 — 63 percent — disapprove of Obama's handling of the economy. Nearly half, or 48 percent, "strongly" disapproved. Approval of his economic performance now stands at just 36 percent, his worst approval rating on the issue in AP-GfK polling.
Among Democrats, 58 percent approve of the president's handling of the economy, down from 65 percent in June. Among Republicans, approval dipped to 9 percent from 15 percent.
Just 51 percent consider Obama a strong leader, down from 60 percent in June and 65 percent following the capture and death of Osama bin Laden in May. In June, 85 percent of Democrats in the poll called him a strong leader. Now, the number is down to 76 percent.
Of course, there are limits to what a president can do.
"I think he can nudge it along, but really, it boils down to the private sector," said Dan Elliott, 42, of Hillsboro, Ill., an independent who voted for Obama in 2008 and says he'll probably vote for him again.
Judith Lee, 63, a retired teacher from Great Diamond Island, Maine, said she's a Republican who voted for Obama in 2008 but has been disappointed by his leadership style.
"I don't think he is a very forceful leader," Lee said. "His style of leadership seems to be to look for consensus and ideas from other people, and it seems to have been ineffective. And Congress seems to be deadlocked on problems."
Some 75 percent in the poll said the country is heading in the wrong direction, up from 63 percent in June. Among Democrats, 61 percent chose "wrong direction" — up from 46 percent in June.
And for the first time for Obama in the poll, a majority of all adults said they disapprove of his overall performance — 52 percent, up from 47 percent in June. Among Democrats, approval fell 8 points, to 74 percent from 82 percent in June. Among Republicans, it fell to 11 percent from 22 percent.
Politically, the poll underscores the difficult time ahead for Obama as he seeks re-election in a shaky economy.
Unemployment increased to 9.2 percent in July, up from 9.1 percent in June. And most economists don't expect it to decline much below 8.5 percent by the November 2012 presidential election. No president has won re-election with a jobless rate that high since Franklin D. Roosevelt in 1936.
So why hasn't the rise in pessimism taken more of a toll?
Despite the general rise in gloom, it seems unlikely that liberal Democrats will flock away from Obama even if they have rising doubts about his agenda or economic leadership, analysts suggest. And independents, who helped elect Obama in 2008 and are now being actively wooed by both parties, did not exhibit significant changes in their approval levels.
It was at 44 percent, statistically no different from the 43 percent approval rating among independents in June.
"A lot is out of his hands," said Penny Johansen, 65, a retired legal secretary from Tempe, Ariz. "There is only so much one person can do, and one person cannot be blamed for the acts of others." Politically unaligned, she voted for Obama in 2008 and says she'll probably do so again.
On related economic issues, 59 percent said they disapproved of Obama's handling of tax issues, up from 53 percent in June. And 64 percent said they disapproved of his handling of the annual budget deficit, compared with 63 percent in June.
Sixty percent described the financial situation in their own households as "good," about even with the level in June. Asked if they expected their financial situation to change over the next 12 months, 31 percent said they expected it to get better, 12 percent expected it to get worse and a majority — 56 percent — said they expected it to "stay about the same."
As to creating jobs, some 44 percent said they would trust Democrats to do a better job, while 42 percent said Republicans would.
The AP-GfK poll was conducted Aug. 18-22 by GfK Roper Public Affairs and Corporate Communications. It involved landline and cellphone interviews with 1,000 adults nationwide and has a margin of sampling error of plus or minus 4.1 percentage points.

With Jobs Out As CEO, Apple Looks To The Future

By RACHEL METZ

SAN FRANCISCO – Since Steve Jobs' return to Apple Inc. in 1997 as CEO, the company has been on an unparalleled upswin g, highlighted by the immense popularity of the iPad and iPhone.
Now, with Jobs no longer leading, Apple will have to prove it can keep its momentum. If the recent past is any indication, the company will continue to move forward.
Apple said late Wednesday that Jobs, 56, resigned from the CEO post, in a move that seems motivated by his ongoing, yet still unspecified health issues. Jobs had taken an indefinite medical leave in January, marking his third such leave in seven years. Jobs, who co-founded Apple in 1976, previously survived pancreatic cancer and received a liver transplant.
Taking on the role of board chairman, Jobs now passes the CEO role Tim Cook, 50, the company's chief operating officer. Cook had been acting CEO since January. For years, he has been running Apple's day-to-day operations, and has long been seen as the natural successor. He also served as Apple's leader for two months in 2004 while Jobs battled cancer, and again for five-and-a-half months in 2009 when Jobs received a liver transplant. The company has thrived under Cook's leadership, briefly becoming the most valuable company in America earlier this month.
Cook is not nearly as recognizable as Jobs, who after returning from a 12-year hiatus in 1997 became the very public face of Apple, clad in his signature blue jeans, black turtleneck and wire-rimmed glasses when trotting out the company's iPhones, iPads, iPods at immensely popular and anticipated media events. Though Jobs has looked increasingly frail, he emerged from his leave twice this year to tout products at such events: First, he unveiled the second version of Apple's iPad tablet computer in March. Then, in June, he resurfaced to show off Apple's iCloud music synching service.
But while Jobs is the most recognized person at Apple, he is not the only one responsible for the company's success. Many industry watchers believe that despite his importance, Apple will continue to innovate and not just survive, but thrive.
Says Cross Research analyst Shannon Cross: "Steve Jobs put in place at Apple a culture of innovation."
And its innovation has translated to sales. With Cook running the company, Apple sold 9.25 million iPads during the most recent quarter, which ended in June, bringing sales to nearly 29 million iPads since they first began selling in April 2010. Apple also sold 20.3 million iPhones in the same period, which was millions more than analysts expected. The company's stock has risen 8 percent since Jobs announced his most recent medical leave.
Cook's track record at Apple is strong. The first time he was in charge back in 2004, things went so well that Apple promoted him from executive vice president to chief operating officer in 2005.
During the second time, which lasted from mid-January to the end of June 2009, Apple released a new version of the iPhone and updated laptop computers on schedule. The company also announced that its iTunes app store hit a major milestone: More than one billion apps were downloaded within the first nine months of its existence.
Apple's stock rose 62 percent during that time, satisfying investors' concerns over Jobs' absence.
Cook, an Alabaman with short, gray hair and a broad, thin-lipped smile, has been an asset to Apple since his arrival in 1998. He is credited with tuning Apple's manufacturing process to solve chronic product delays and supply problems. His inventory management skills helped Apple build up its $72.6 billion hoard of cash and marketable securities — funds that it can use to keep its lead in the portable electronics market.
Like IBM, McDonald's or Ford, all of which lost visionary CEOs, Apple is not necessarily dependent on the immortality of the genius behind it, says Terry Connelly, dean of the Ageno School of Business at Golden Gate University in San Francisco.
"A company is dependent on its ability to institutionalize that genius in the corporate DNA," he says. "Apple shows every sign of having done that. We will see that when we see how Cook responds to competitive pressure."
And, as Cross points out, Cook won't be leading Apple alone. His supporting team includes Jonathan Ive, who oversees the elegant, minimalist design of Apple's products; Ron Johnson, who runs Apple's stores; Philip Schiller, the marketing chief; and Scott Forstall, who supervises the iPhone software.
"The bench at Apple is extremely strong," Cross says. "He has a good group of executives behind him."
And consumers — the group Apple really depends on to make its products popular — may not be that affected by the change.
Apple customers don't buy the company's products because of Steve Jobs, Gartner Research analyst Michael Gartenberg says, they buy Apple products because they're Apple products. Without Jobs, he believes the company's challenge will be the same as it was with him: continuing to find ways to raise the bar with its consumer electronics.
"Yes, this is quite some transition at the end of Steve's role and his time at Apple, but it doesn't mean Apple itself will fundamentally change," he says. "Certainly Apple's competition would be foolish to think this is a situation they could somehow capitalize on."

Steve Jobs, Apple CEO and creative force, resigns

By RACHEL METZ and JORDAN ROBERTSON

SAN FRANCISCO – Steve Jobs, the mind behind the iPhone, iPad and other devices that turned Apple Inc. into one of the world's most powerful companies, resigned as CEO on Wednesday, saying he can no longer handle the job but will continue to play a leadership role.
The move appears to be the result of an unspecified medical condition for which Jobs took a leave from his post in January. Apple's chief operating officer, Tim Cook, was quickly named CEO of the company Jobs co-founded 35 years ago in his garage.
In a letter addressed to Apple's board and the "Apple community," Jobs said he "always said if there ever came a day when I could no longer meet my duties and expectations as Apple's CEO, I would be the first to let you know. Unfortunately, that day has come."
The company said Jobs gave the board his resignation Wednesday and suggested Cook be named the company's new leader. Apple said Jobs was elected board chairman and Cook is becoming a member of its board.
Genentech Inc. Chairman Art Levinson, in a statement issued on behalf of Apple's board, said Jobs' "extraordinary vision and leadership saved Apple and guided it to its position as the world's most innovative and valuable technology company."
He said that Jobs will continue to provide "his unique insights, creativity and inspiration," and that the board has "complete confidence" that Cook is the right person to replace him.
""Tim's 13 years of service to Apple have been marked by outstanding performance, and he has demonstrated remarkable talent and sound judgment in everything he does," Levinson said.
Jobs' health has long been a concern for Apple investors who see him as an industry oracle who seems to know what consumers want long before they do. After his announcement, Apple stock quickly fell 5.4 percent in after-hours trading.
Jeff Gamet, managing editor of The Mac Observer online news site focused on Apple, said Jobs' departure has more sentimental than practical significance, and that he has been telegraphing the change for several years.
"All Apple really has done is made official what they've been doing administratively for a while now, which is Tim runs the show and Steve gets to do his part to make sure the products come out to meet the Apple standard," he said.
"I expect that even though there are a lot of people that right now are sad or scared because Steve is stepping back from the CEO role, that ultimately they'll be OK," Gamet said.
But Trip Chowdhry, an analyst with Global Equities Research, said Jobs' maniacal attention to detail is what set Apple apart. He said Apple's product pipeline might be secure for another few years, but predicted that the company will eventually struggle to come up with market-changing ideas.
"Apple is Steve Jobs, Steve Jobs is Apple, and Steve Jobs is innovation," Chowdhry said. "You can teach people how to be operationally efficient, you can hire consultants to tell you how to do that, but God creates innovation. ... Apple without Steve Jobs is nothing."
Earlier this month Apple became the most valuable company in America, briefly surpassing Exxon Mobil. At the market close Wednesday its market value was $349 billion, just behind Exxon Mobil's $358 billion.
Jobs' hits seemed to grow bigger as the years went on: After the colorful iMac computer and the now-ubiquitous iPod, the iPhone redefined the category of smart phones and the iPad all but created the market for tablet computers.
His own aura seemed part of the attraction. On stage at trade shows and company events in his uniform of jeans, sneakers and black mock-turtlenecks, he'd entrance audiences with new devices, new colors, new software features, building up to a grand finale he'd predictably preface by saying, "One more thing."
Jobs, 56, shepherded Apple from a two-man startup to Silicon Valley darling when the Apple II, the first computer for regular people to really catch on, sent IBM Corp. and others scrambling to get their own PCs to market.
After Apple suffered a slump in the mid-1980s, he was forced out of the company. He was CEO at Next, another computer company, and Pixar, the computer-animation company that produced "Toy Story" on his watch, over the following 10 years.
Apple was foundering as he returned as an adviser in 1996 — a year it lost $900 million as Microsoft Windows-based PCs dominated the computer market. The company's fortunes began to turn around with its first new product under Jobs' direction, the iMac, which launched in 1998 and sold about 2 million in its first 12 months.
Jobs eventually became interim CEO, then took the job permanently. Apple's popularity grew in the U.S. throughout the 2000s as the ever-sleeker line of iPods introduced many lifelong Windows users to their first Apple gadget. Apple created another sensation in 2007 with the iPhone, the stark-looking but powerful smart phone that quickly dominated the industry.
The iPad was introduced less than a year and a half ago but has already sold nearly 29 million units as it inspired myriad rivals in a tablet computer market that scarcely existed before Apple stepped in.
There have been some setbacks. Apple was swept up in a massive Securities and Exchange Commission inquiry into stock options backdating in the mid-2000s, a practice that artificially boosted the value of options grants. But Jobs and Apple emerged unscathed after two former executives took the fall and eventually settled with the SEC.
As Jobs was praised for his vision, concerns about his health persisted. The January leave was Jobs' third medical leave over several years. He had previously survived pancreatic cancer and received a liver transplant.
Shannon Cross, an analyst at Cross Research, said Cook is a good choice to replace Jobs.
"He has taken over for Jobs twice in two medical leaves and the company has functioned extremely well," she said, adding that Cook has been Jobs' "right hand guy" for many years.
Cross also said Jobs put in place a "culture of innovation" that will help Apple remain a creative force in the industry.
"Steve Jobs is an extremely strong leader and clearly has made Apple a leading consumer electronics company and one of the most innovative companies in the world," she said. "However, he didn't do it alone."