As police battle a rise in prostitution on O'ahu, the only organization in the Islands aimed at helping prostitutes escape sexual exploitation for better lives is closing because of a lack of money.

Over the last decade, organizers said Sisters Offering Support has helped hundreds leave prostitution. It has also worked to prevent young people from being lured into the industry, promoted safe sex among prostitutes and helped federal authorities reduce sex trafficking in Hawai'i.

"It has been the most rewarding years of my life, being part of an organization that has helped hundreds, if not thousands, of individuals get out of an exploitative lifestyle," said Lorraine Faithful, executive director since 2001. "For so many years, I've been helping to build the organization. Now, I'm having to tear it down."

Residents and advocates for women say closure of the nonprofit is a loss to the community and couldn't come at a worse time.

In August, Honolulu police reported prostitution arrests were up in 2005 for the first time in four years. Last year, prostitution arrests jumped 51 percent from 2004, from 265 to 401 islandwide, according to police statistics.

The increase, along with a July homicide linked to prostitution, spurred an outcry Downtown, with residents calling for prostitution-free zones and tougher sentences for prostitutes and "clients" who get caught.

Tom Smyth, Downtown Ho-nolulu Neighborhood Board chairman, said bringing harsher punishments against prostitutes will likely decrease crime. But the best deterrent, he said, is to get prostitutes out of the sex industry.

"That, to me, is the most effective way to deal with the overall problem because it addresses the overall population," Smyth said, expressing dismay at the closure of Sisters Offering Support. "We definitely recognize their efforts."

The nonprofit will officially dismantle on Sept. 30, about a month after its board decided to shut down in the face of diminishing funds.

Already, the agency's two employees have been laid off, a 24-hour crisis hotline is no longer manned and new clients are not being accepted. Worst of all, Faithful said, about 500 people being helped with counseling programs were told in mid-September they would have to seek help elsewhere.

Hale Kipa, a nonprofit serving at-risk youth, agreed to pick up the educational component of Sisters Offering Support. "That is the nice, positive spin to this whole story," Faithful said. "Some of our programs will survive."

Kelly Hill, a former prostitute, founded Sisters Offering Support in 1996. Over the years, the organization has received praise for its success in changing people's lives and educating the community about sexual exploitation.

Faithful declined to go into the details of the nonprofit's finances for 2006 but said individual donor contributions had dropped significantly this year while operating costs continued to rise. Plus, the agency had no savings.

"In the middle of August, we saw some writing on the wall," Faithful said. "A lot of local donors chose to support the Hurricane Katrina victims."

In the fiscal year that ended June 30, 2005, Sisters Offering Support got $217,888 — the bulk of which came from public donations and grants, according to tax returns filed with the Internal Revenue Service.

The operating funds were an increase of about $10,000 from 2003, but about $70,000 lower than totals for the three previous years.

In 2004, salary costs amounted to $121,396, with Faithful earning $47,500 a year. Program costs amounted to $189,221, the returns show.

Those funds went to helping between 400 and 500 clients a year, and putting on educational programs at dozens of Hawai'i public schools.

In the agency's most recent annual report, issued last year, there were no apparent signs of trouble. In fact, Faithful expressed hopes in the document of opening a transitional shelter for prostitutes by 2008 and discussed the possibility of establishing a school for those arrested for hiring a prostitute.

Faithful yesterday said the agency is small and any decrease in funding affected its ability to remain open. "We were already working on the bare-bones minimum," she said. "We're hoping that someone in Hawai'i will maybe pick up this same idea and continue these services elsewhere."

FAMILIAR PROBLEM

Cheryl Ka'uhane Lupenui, president and chief executive officer of YWCA O'ahu, said she knows all too well about the challenges of running a nonprofit.

Oftentimes, she said, organizations are willing to give funds for programs but won't donate unrestricted money that can be used for everything from office supplies to wages. "We really diversify our funding stream," she said.

"But it's a case example: We know sexual exploitation is huge, and here's an organization that was committed to prevention and intervention, yet they couldn't get the funding. That's scary for any nonprofit."

Reach Mary Vorsino at mvorsino@honoluluadvertiser.com.