Washington Blade - May 31, 2002
Lou Chibbaro Jr.

[In an unrelated development, the mother of a 31-year-old District woman who died after becoming ill while participating as a bicyclist in the D.C. AIDS Ride two years ago filed this week a $10 million wrongful death lawsuit against Pallotta Teamworks. Please see story.]

Food & Friends, which provides meals to homebound people with HIV and other illnesses, said it will produce its own Washington, D.C., AIDS Ride in 2003 and will be the sole beneficiary. Whitman-Walker, the D.C. area's largest private agency providing services to people with HIV and AIDS, said it will not participate in the 2003 ride, saying it has deciding instead to pursue other fund-raising methods to make up for the funds it has received through the rides.

Officials with the two groups said the Pallotta-produced AIDS bicycle ride for this year would proceed as planned, with more than 1,900 riders expected to participate. The ride is scheduled to begin June 13 in Norfolk, Va., and finish June 16 in Washington.

The action by Whitman-Walker and Food & Friends ends a seven-year partnership with the Pallotta firm that pulled in $14 million in net proceeds for the first six years, an amount that the two groups split evenly.

"Everyone agrees that while the seven-year relationship has been extremely successful in raising critical funding and awareness of HIV and AIDS, the time has come to examine changes in our overall strategy and approach to fund-raising," said Craig Shniderman, the Food & Friends executive director.

Shniderman said the two groups would now pursue fund-raising efforts aimed at "local solutions to local client needs."

Cornelius Baker, the clinic's executive director, said Whitman-Walker would place more fund-raising emphasis on expanded outreach to foundations and corporate donors, as well as a more aggressive recruitment of large, individual donors as a means of making up the revenue generated from the rides.

Two AIDS service organizations in California also pulled from a Pallotta-organized AIDS Ride last year, resulting in the Pallotta firm filing suit against the groups. But Pallotta Teamworks officials said this week they are content with the decision by the D.C. groups and even welcomes Food & Friends' decision to organize its own ride in 2003.

"We wish them tremendous success in fulfilling their mission, and we're always here for pro bono advice if they ever need it," said Dan Pallotta, chief executive officer of Pallotta Teamworks, in a joint statement issued by his company and the two D.C. AIDS groups. "God bless all the riders and crew, and all those they have served," he said.

Groups say controversy did not lead to pullout

The decision by Whitman-Walker and Food & Friends to part company with Pallotta Teamworks comes after growing criticism that the Pallotta firm incurred excessively high overhead and production costs in putting on its events.

The company acknowledges that the highly publicized bicycle rides, which draw thousands of cyclists and large production and support crews, are expensive to put on. But company officials say the rides have raised millions of dollars for AIDS causes and have drawn widespread public attention to AIDS since Pallotta Teamworks began the fund-raising rides in 1994.

An ad hoc group of AIDS activists and professional fund-raisers, organized by the owner of a company that produces many of the nation's AIDS fund-raising walks, has placed ads in gay newspapers criticizing Pallotta Teamworks for spending too much money on overhead costs for the rides.

Baker and Shniderman said this week that their decision to break from the Pallotta firm had nothing to do with such complaints, but they acknowledged the ad campaign criticizing Pallotta in the gay press may have hurt their efforts to recruit riders for this year's D.C. AIDS Ride.

Whitman-Walker spokesperson Michael Cover said revenue for the ride could drop from $3.4 million in net proceeds last year to as little as $800,000 in net proceeds this year under a "worst case" scenario.

Earlier this year, a New York City-based AIDS vaccine research center withdrew as a recipient of the Pallotta Teamworks' AIDS vaccine rides, citing high overhead costs for the 2001 vaccine rides as its reason.

Last week, the Avon cosmetics company announced that its breast cancer foundation was also withdrawing as the sole beneficiary of the Pallotta firm's breast cancer three-day fund-raising walks in 2003. Pallotta Teamworks said it plans to continue both the vaccine rides and three-day breast cancer walks and would find new beneficiaries for the events.

In announcing their decision to end their ties with Pallotta Teamworks, Baker and Shniderman disputed criticism that the company's overhead costs and fees were excessive for the Washington, D.C., AIDS Rides. The two said they believed that overhead costs that ranged from 45 cents to just under 50 cents on the dollar for the first six D.C. AIDS Rides were reasonable for this type of large-scale fund-raising event.

"We have always worked for the best possible outcome," Shniderman said. "Now, we feel that a locally produced event will save money on costs."

"This came about though a normal review of our fund-raising goals," Baker said, in discussing Whitman-Walker's decision to withdraw its participation from the AIDS rides. He said the clinic's board and staff began to reassess the clinic's participation in the AIDS rides about a year and a half ago, conducting a review "of the full portfolio of our fund-raising activities."

Baker and Shniderman said they informed Dan Pallotta earlier this year, in a meeting in D.C., that they were ending their ties with Pallotta Teamworks. The two said Pallotta understood their concerns and expressed a willingness to cooperate with them if they chose to withdraw from the Pallotta-produced events.

Baker said the Whitman-Walker board made the final decision not to renew the clinic's contract with Pallotta during a meeting on May 21.

"The D.C. AIDS Ride will live in the history books of social activism forever, as will every one of the people who rode or crewed in it over the years," Dan Pallotta said in the joint statement released this week. "It was designed to give people a powerful outlet for their grief, their outrage, their compassion, and their passion to do something bold, something awesome about the AIDS epidemic," Pallotta said. "It did its job, and then some."

Baker said that while Whitman-Walker won't participate in an AIDS ride next year, the clinic would consider joining Food & Friends in other fund-raising events, including possibly an AIDS ride, in future years.

News reporter Lou Chibbaro Jr. can be reached at lchibbaro@washblade.com.

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