Macdonald declined to explain his reasons for stepping down. He will stay on as a volunteer to organize the nonprofit's annual poverty conference on Oct. 18 - possibly its last.

Macdonald's departure may signal the end for the 33-year-old advocacy group, one of the oldest and most trusted voices for Utah's poor.

Utah Issues is $25,000 in debt, and the search for a new director has been unproductive, said Pete Ashdown, newly appointed chairman of the group's board of directors.

"We're at a stage now where I believe Utah Issues will not recover unless there's a benefactor who will fund the salary for a new director to, in turn, fund-raise," said Ashdown. "No one is interested in coming on board and finding their own salary."

Ashdown said the board will meet sometime in the next few weeks to weigh Utah Issues' future.

Most of the debt is in unpaid salaries, said Ashdown, CEO of XMission, an Internet service provider in Salt Lake City. "Some of it can be forgiven, some of it can't."

The Utah Issues Center for Poverty Research and Action was founded in 1973 with the mission of developing public policies for combating poverty. It employed experts in housing, welfare, health, wage and tax reform, and at its height boasted a budget of $1 million.

But it fell on hard times following an exodus of key staff in 2005, amid allegations of financial mismanagement under former director Leticia Medina.

The flight of employees led to a flight of capital as research grants went unattended and private donors lost confidence in the organization.

"It's tragic that Utah Issues, aside from that single scandal, has done such great work in our community," said Ashdown. "I'm dismayed to see it finally disappearing."

Macdonald, formerly chief economist for Utah's Tax Commission, was hired in April 2006 to rebuild the nonprofit.

Though a capable researcher and financial manager, Macdonald wasn't experienced at raising money, said Ashdown.

Two staff remain, and one would like to salvage the 501c-3 organization under a different name, as more of a consulting group, said Ashdown. "I support the idea, but it my view, it would be easier to start from scratch absent the financial obligations," he said.

Many former staff are now employed by other advocacy groups where they continue to press for health care, Medicaid, tax and wage reforms.

But losing Utah Issues is like losing a piece of Utah history, said Irene Fisher, the organization's director from 1981 to 1987.

The nonprofit has taken a lead role in some of the biggest social welfare debates at the Legislature, she said.

"But its most important legacy was helping policymakers understand that low-income families want to work and become self-sufficient," Fisher said. "They just need resources to help them."

kstewart@sltrib.com