Max
05-25-2003, 03:26 PM
Antagonisms cloud Camp Attitude
05/25/03
BRYAN DENSON
SWEET HOME -- After a surfing accident left him a quadriplegic at age 17, Ron Heagy Jr. rebuilt his life. He embarked on a career as a motivational speaker and co-authored two books that encouraged personal responsibility, positive attitudes and Christian values.
From his motorized wheelchair, the one-time Disabled Oregonian of the Year lectured coast to coast. At last count, he had reached nearly 2 million people. Along the way, Heagy pumped speaking fees, donations and grants into a nonprofit camp for disabled children east of Sweet Home. His grand plan was to replicate the retreat, which he values at $2 million, in every state.
But the future of Heagy's dream is imperiled by personal and financial scandal.
Associates of the 41-year-old Albany resident accuse him of wrongly profiting from the nonprofit group that manages the summer camp.
Earlier this year, three of those associates -- all former board members -- filed a lawsuit in Linn County that accuses Heagy of breaching his fiduciary duty to the group. They seek an order preventing Heagy from directing the organization, Camp Attitude Oregon Inc., along with $50,000 in damages. They also seek a full accounting of donations to the camp to ensure they remain the property of the nonprofit.
The Oregon Department of Justice is keeping close watch on accusations of malfeasance at Camp Attitude. Christine Miller, an assistant attorney general who oversees the state's charitable organizations, reviewed some of the nonprofit's financial records last year. She concluded in a letter to Heagy's organization that his use of the group's funds was questionable and appeared to show "private benefit and self dealing."
The Justice Department inquiry, prompted by board members' complaints, points up the minimal oversight given Oregon's 11,000-plus nonprofits. The state registers the groups and requires yearly financial reports but lacks the resources to perform random audits of their finances, said Victoria Cox, spokeswoman for the Justice Department's Charitable Activities Section. Ultimately, she said, groups must police their own finances.
Public records filed at Miller's office indicate Heagy used nonprofit funds to pay for personal items, including a 1995 Corvette, massages, touch-ups to his hair-weave, an investment in a candy business and items from Victoria's Secret.
In interviews with The Oregonian, Heagy acknowledged that he paid for personal items with the nonprofit's checks and credit cards. But he said the group's board of directors allowed him to use those accounts to reimburse him for his share of more than $700,000 that he pumped into the organization.
Heagy, who is president of the organization, contends that 85 percent of those accumulated earnings -- in addition to his $36,000 annual salary -- belonged to him by agreement of the board of directors.
Questionable dealings In court papers filed May 2, however, former board member Jim Boryska, a plaintiff in the lawsuit, challenged Heagy's assertion that 85 percent of the money belonged to him: "I am aware of no written agreement that allows Mr. Heagy to retain donations made to (the nonprofit)."
Either way, said Miller, Heagy's financial arrangement appears questionable.
"At the end of the day, if he were taking assets that were meant to go into the camp, then that is misuse of charitable assets under state and federal law," Miller said.
The accusations of financial wrongdoing came to light among board members and key donors a little more than a year ago, about the time they became concerned that Heagy, who was married, was involved in a relationship with the group's longtime bookkeeper.
Several contributors to the camp -- true believers in the charismatic Heagy's never-say-die attitude and Christian values -- were shaken by Heagy's revelation that he had a relationship with a married woman.
Heagy apologized to his friends and fellow board members about the relationship, which he characterized as an "emotional" rather than physical relationship that involved some passionate kissing. The bookkeeper, who has not been accused of financial wrongdoing, resigned from the organization. Both her marriage and Heagy's ended in divorce.
The incident divided the nonprofit's board of directors. The rift -- and subsequent scrutiny of the group's finances by several disappointed board members -- prompted defections by key donors and other supporters in late 2001.
Heagy estimated that grants and donations plunged from about $1.3 million in 2001 to about half that in 2002.
Jim Lusk, the nonprofit group's interim treasurer, calculated that income from Heagy's speaking engagements -- along with sales of his books, tapes and other products -- dipped to $68,606 last year after a yearly average of $244,468 from 1999 to 2001. The lawsuit, he said, forced Heagy to "put out fires" at home rather than generate income on the road.
Both Heagy and Lusk blame the plummeting finances not on the souring economy but on bad publicity about the group's fiscal affairs, which reached donors. Some pulled out.
"It's like I'm guilty until proven innocent," Heagy said. "None of the funds that were donated for the camp were misused." Loss of faith Heagy's organization, formerly known as Life Is an Attitude, began with a Christian mission but grew more secular after the group established nonprofit corporation status in 1998.
Under the law, Heagy could not carry religious themes into public schools, which accounted for many of his lectures.
Christianity forms the backbone of Heagy's ethics. Those beliefs are front and center in his 1997 book, "Life Is an Attitude: A Tragedy Turns to Triumph." The goals of Heagy's nonprofit corporation -- promoting respect for life, encouraging sacrificial giving and volunteerism, demonstrating love through action -- reflected those Christian values.
But some of those who once were among Heagy's most ardent supporters say they saw signs he was shifting away -- at least outwardly -- from his religious roots. And they lost faith in him.
One of them was Ken Laing, a 64-year-old retired grocery manager who met Heagy five years ago. Laing was inspired that a young man whose movements were limited to his neck and head -- Heagy uses his mouth to write, paint and move his wheelchair -- could maintain a sunny outlook.
When Laing and his wife, Phyllis, learned that Heagy gave motivational speeches, they got him speaking engagements near their "snowbird" home in Desert Hot Springs, Calif. The Laings joined Heagy and then-wife Christy on speaking tours and helped raise funds for Camp Attitude.
But one day in the summer of 2000, Laing discovered that Heagy sold his in-laws a motor home that had been donated to the camp. A day earlier, the group had offered the motor home to the highest bidder in a silent auction. Laing, in tears, scolded Heagy for what he felt was misappropriation of a camp asset and behavior not befitting a Christian.
Heagy, who describes the incident as a misunderstanding, said his organization contacted the high bidder later to see if he still wanted to buy the mobile home and found he did not.
The Laings, disgusted by the motor home affair, parted ways with Heagy.
"Win-win" transaction In another incident, in January 2001, board member Boryska donated a manufactured home to the nonprofit, which he estimated in court papers to have a fair market value of $70,000. Boryska accuses Heagy of selling the home to Heagy's parents for $39,000 and pocketing the money based on his contention that the nonprofit owed him money.
Heagy described the purchase as a "win-win for everybody" that the board of directors approved in a vote in which he abstained. The sale, he said, gave his parents a dwelling and allowed Boryska to sell a manufactured home he no longer wanted -- with a $70,000 tax write-off. Camp Attitude sits just off U.S. 20, a few miles east of Foster Reservoir, along the South Santiam River. The 21-acre camp features walkways for wheelchairs, cabins with green tin roofs, a bathhouse and other amenities.
Heagy said his father owns the land and rents it to the nonprofit group for $750 a month.
Sitting on a deck at the camp recently with board member Lusk, Heagy blamed his present tribulations on three former board members who proved -- by holding a meeting behind his back, slipping financial records to the Department of Justice and filing a lawsuit -- that they weren't team players.
Heagy thinks they were out to remove him as executive director of the organization because of his extramarital romance of late 2001. He said he has not seen his former bookkeeper since May 2002.
"It's been a year," Heagy said. "Am I forgiven yet?"
Camp Attitude, meanwhile, appears to be open for business.
The camp for disabled children opened in July 2000 with a one-week session, then another weeklong session the following summer before expanding to two weeks last summer. The camp remained under construction, although it is available for public rentals.
Although Heagy acknowledged that the camp's financial troubles tempted him to call off the summer camp this year, he and his board have scheduled two weeklong camps.
Heagy said a bookkeeper and a certified public accountant are reorganizing the nonprofit's books under a January order from the board of directors. Also, the group is regularly reporting its progress to the state Department of Justice.
In February, a few weeks after the lawsuit was filed, Camp Attitude's board of directors met and agreed to offer Heagy $400,000 of the $681,709 owed to him for his share of the money he brought into the organization, said Lusk. Heagy's "advances" -- in the amount of $170,000 over five years -- would be subtracted from the $400,000, he said.
"We, as a board, officially owe Ron," he said. Correspondent Matt Sabo and news researcher Lynne Palombo contributed to this report. Bryan Denson: 503-294-7614; bryandenson@news.oregonian.com
Copyright 2003 Oregon Live. All Rights Reserved.
http://www.oregonlive.com/news/oregonian/index.ssf?/base/news/105377771615280.xml
05/25/03
BRYAN DENSON
SWEET HOME -- After a surfing accident left him a quadriplegic at age 17, Ron Heagy Jr. rebuilt his life. He embarked on a career as a motivational speaker and co-authored two books that encouraged personal responsibility, positive attitudes and Christian values.
From his motorized wheelchair, the one-time Disabled Oregonian of the Year lectured coast to coast. At last count, he had reached nearly 2 million people. Along the way, Heagy pumped speaking fees, donations and grants into a nonprofit camp for disabled children east of Sweet Home. His grand plan was to replicate the retreat, which he values at $2 million, in every state.
But the future of Heagy's dream is imperiled by personal and financial scandal.
Associates of the 41-year-old Albany resident accuse him of wrongly profiting from the nonprofit group that manages the summer camp.
Earlier this year, three of those associates -- all former board members -- filed a lawsuit in Linn County that accuses Heagy of breaching his fiduciary duty to the group. They seek an order preventing Heagy from directing the organization, Camp Attitude Oregon Inc., along with $50,000 in damages. They also seek a full accounting of donations to the camp to ensure they remain the property of the nonprofit.
The Oregon Department of Justice is keeping close watch on accusations of malfeasance at Camp Attitude. Christine Miller, an assistant attorney general who oversees the state's charitable organizations, reviewed some of the nonprofit's financial records last year. She concluded in a letter to Heagy's organization that his use of the group's funds was questionable and appeared to show "private benefit and self dealing."
The Justice Department inquiry, prompted by board members' complaints, points up the minimal oversight given Oregon's 11,000-plus nonprofits. The state registers the groups and requires yearly financial reports but lacks the resources to perform random audits of their finances, said Victoria Cox, spokeswoman for the Justice Department's Charitable Activities Section. Ultimately, she said, groups must police their own finances.
Public records filed at Miller's office indicate Heagy used nonprofit funds to pay for personal items, including a 1995 Corvette, massages, touch-ups to his hair-weave, an investment in a candy business and items from Victoria's Secret.
In interviews with The Oregonian, Heagy acknowledged that he paid for personal items with the nonprofit's checks and credit cards. But he said the group's board of directors allowed him to use those accounts to reimburse him for his share of more than $700,000 that he pumped into the organization.
Heagy, who is president of the organization, contends that 85 percent of those accumulated earnings -- in addition to his $36,000 annual salary -- belonged to him by agreement of the board of directors.
Questionable dealings In court papers filed May 2, however, former board member Jim Boryska, a plaintiff in the lawsuit, challenged Heagy's assertion that 85 percent of the money belonged to him: "I am aware of no written agreement that allows Mr. Heagy to retain donations made to (the nonprofit)."
Either way, said Miller, Heagy's financial arrangement appears questionable.
"At the end of the day, if he were taking assets that were meant to go into the camp, then that is misuse of charitable assets under state and federal law," Miller said.
The accusations of financial wrongdoing came to light among board members and key donors a little more than a year ago, about the time they became concerned that Heagy, who was married, was involved in a relationship with the group's longtime bookkeeper.
Several contributors to the camp -- true believers in the charismatic Heagy's never-say-die attitude and Christian values -- were shaken by Heagy's revelation that he had a relationship with a married woman.
Heagy apologized to his friends and fellow board members about the relationship, which he characterized as an "emotional" rather than physical relationship that involved some passionate kissing. The bookkeeper, who has not been accused of financial wrongdoing, resigned from the organization. Both her marriage and Heagy's ended in divorce.
The incident divided the nonprofit's board of directors. The rift -- and subsequent scrutiny of the group's finances by several disappointed board members -- prompted defections by key donors and other supporters in late 2001.
Heagy estimated that grants and donations plunged from about $1.3 million in 2001 to about half that in 2002.
Jim Lusk, the nonprofit group's interim treasurer, calculated that income from Heagy's speaking engagements -- along with sales of his books, tapes and other products -- dipped to $68,606 last year after a yearly average of $244,468 from 1999 to 2001. The lawsuit, he said, forced Heagy to "put out fires" at home rather than generate income on the road.
Both Heagy and Lusk blame the plummeting finances not on the souring economy but on bad publicity about the group's fiscal affairs, which reached donors. Some pulled out.
"It's like I'm guilty until proven innocent," Heagy said. "None of the funds that were donated for the camp were misused." Loss of faith Heagy's organization, formerly known as Life Is an Attitude, began with a Christian mission but grew more secular after the group established nonprofit corporation status in 1998.
Under the law, Heagy could not carry religious themes into public schools, which accounted for many of his lectures.
Christianity forms the backbone of Heagy's ethics. Those beliefs are front and center in his 1997 book, "Life Is an Attitude: A Tragedy Turns to Triumph." The goals of Heagy's nonprofit corporation -- promoting respect for life, encouraging sacrificial giving and volunteerism, demonstrating love through action -- reflected those Christian values.
But some of those who once were among Heagy's most ardent supporters say they saw signs he was shifting away -- at least outwardly -- from his religious roots. And they lost faith in him.
One of them was Ken Laing, a 64-year-old retired grocery manager who met Heagy five years ago. Laing was inspired that a young man whose movements were limited to his neck and head -- Heagy uses his mouth to write, paint and move his wheelchair -- could maintain a sunny outlook.
When Laing and his wife, Phyllis, learned that Heagy gave motivational speeches, they got him speaking engagements near their "snowbird" home in Desert Hot Springs, Calif. The Laings joined Heagy and then-wife Christy on speaking tours and helped raise funds for Camp Attitude.
But one day in the summer of 2000, Laing discovered that Heagy sold his in-laws a motor home that had been donated to the camp. A day earlier, the group had offered the motor home to the highest bidder in a silent auction. Laing, in tears, scolded Heagy for what he felt was misappropriation of a camp asset and behavior not befitting a Christian.
Heagy, who describes the incident as a misunderstanding, said his organization contacted the high bidder later to see if he still wanted to buy the mobile home and found he did not.
The Laings, disgusted by the motor home affair, parted ways with Heagy.
"Win-win" transaction In another incident, in January 2001, board member Boryska donated a manufactured home to the nonprofit, which he estimated in court papers to have a fair market value of $70,000. Boryska accuses Heagy of selling the home to Heagy's parents for $39,000 and pocketing the money based on his contention that the nonprofit owed him money.
Heagy described the purchase as a "win-win for everybody" that the board of directors approved in a vote in which he abstained. The sale, he said, gave his parents a dwelling and allowed Boryska to sell a manufactured home he no longer wanted -- with a $70,000 tax write-off. Camp Attitude sits just off U.S. 20, a few miles east of Foster Reservoir, along the South Santiam River. The 21-acre camp features walkways for wheelchairs, cabins with green tin roofs, a bathhouse and other amenities.
Heagy said his father owns the land and rents it to the nonprofit group for $750 a month.
Sitting on a deck at the camp recently with board member Lusk, Heagy blamed his present tribulations on three former board members who proved -- by holding a meeting behind his back, slipping financial records to the Department of Justice and filing a lawsuit -- that they weren't team players.
Heagy thinks they were out to remove him as executive director of the organization because of his extramarital romance of late 2001. He said he has not seen his former bookkeeper since May 2002.
"It's been a year," Heagy said. "Am I forgiven yet?"
Camp Attitude, meanwhile, appears to be open for business.
The camp for disabled children opened in July 2000 with a one-week session, then another weeklong session the following summer before expanding to two weeks last summer. The camp remained under construction, although it is available for public rentals.
Although Heagy acknowledged that the camp's financial troubles tempted him to call off the summer camp this year, he and his board have scheduled two weeklong camps.
Heagy said a bookkeeper and a certified public accountant are reorganizing the nonprofit's books under a January order from the board of directors. Also, the group is regularly reporting its progress to the state Department of Justice.
In February, a few weeks after the lawsuit was filed, Camp Attitude's board of directors met and agreed to offer Heagy $400,000 of the $681,709 owed to him for his share of the money he brought into the organization, said Lusk. Heagy's "advances" -- in the amount of $170,000 over five years -- would be subtracted from the $400,000, he said.
"We, as a board, officially owe Ron," he said. Correspondent Matt Sabo and news researcher Lynne Palombo contributed to this report. Bryan Denson: 503-294-7614; bryandenson@news.oregonian.com
Copyright 2003 Oregon Live. All Rights Reserved.
http://www.oregonlive.com/news/oregonian/index.ssf?/base/news/105377771615280.xml