The board chairman of a regional Boy Scouts council said yesterday that the group was distraught over the loss of funding from the United Way.

On Thursday, the United Way of Southeastern Pennsylvania voted to cancel the second half of a $400,862 grant for the Cradle of Liberty Council because the council reneged on its adoption of a nondiscrimination policy against gays. United Way also cut the second half of a $17,901 grant to the Boy Scouts' Chester County Council, also because of discrimination against gays.

"We're absolutely devastated by this," said David H. Lipson Jr., Cradle of Liberty's board chairman. "We met with United Way. We told them clearly that we're trying to bring about change. It's evolutionary rather than revolutionary."

The United Way had been working with Cradle of Liberty representatives for two years on the issue of discrimination against gays. The United Way has a policy of nondiscrimination based on sexual orientation and does not provide funds to organizations that discriminate.

The Boy Scouts of America won a U.S. Supreme Court decision in 2000 that upheld the group's decision to fire an openly gay scout leader.

Since that time, the United Way has targeted its Boy Scouts grant money exclusively for the scouts' Learning for Life Program, which was organized in the schools. Anyone could participate.

In its public statement released after the announcement of the funding cut, the United Way said it had "determined that there was not sufficient organizational separation between the Learning for Life program and the overall Boy Scouts organization."

Lipson, however, mourned the loss of the program for inner-city children.

"It's character-building training for kids, how to be a better citizen," Lipson said. "I don't know how we're going to do this. The program cost $600,000 a year, and United Way gave us $400,000."

Jennifer Hathaway, spokeswoman for United Way, said yesterday that the response to the agency's move had been low-key, partially because United Way president Christine James-Brown had spoken to many people in the community before the decision was made.

"The corporations locally said this was aligned with our policies of nondiscrimination," Hathaway said.

The Cradle of Liberty Council voted unanimously in May to adopt an antidiscrimination policy regarding sexual orientation. The move was directly related to negotiations with United Way and was an attempt to bring the local council into compliance with United Way's nondiscrimination policies.

But when the national Boy Scouts of America organization learned of the local council's decision, it immediately threatened to revoke the Cradle of Liberty Council's charter and to replace the board.

The local council succumbed to the pressure and ousted a South Philadelphia Life Scout, Gregory Lattera, who announced he was gay.

"The irony is that we are a council that is working to bring about change in the Boy Scouts," Lipson said. "It can't be done in a day. We've learned that."