Hi-yo Philanthropic Silver, Away!
posted on: Wednesday, November 23, 2005
Maybe that’s what the Lone Ranger as well as the users of the proposed equestrian center in Redding, California might say, thanks to the beneficence of the McConnell Foundation.
Located in Shasta County, Redding is a small city of 80,000 people, more than 85% white, a largely Republican community represented in Congress by 10-term arch-conservative Wally Herger. The big philanthropic player in Redding is the McConnell Foundation, one of the largest private foundations north of San Francisco, founded by the late Carl and Leah McConnell, wealthy through real estate investments plus major holdings in Farmer’s Insurance Group.
With a mission to “help build better communities through philanthropy,” McConnell’s $11 million in grants in 2004 supported a handful of educational programs and scholarships, nearly $200,000 in employee matching gifts, $100,000 for “program consultants”, listed in the Foundation’s list of grants, $92,000 for Redding’s July 4th fireworks, and $280,000 for continuing work in Nepal as McConnell’s international program. The Foundation’s operating costs were another $8,000,000, including the CEO’s salary of $326,000, a sizeable admin hit for a grants portfolio of only $11 million, though the foundation would probably point to the $3 million that it devotes to its 400-acre Lema Ranch headquarters in explanation.
The bulk of McConnell’s grantmaking went to the Turtle Bay Exploration Park, including a $7.2 million gift to the Turtle Bay endowment. The Park is a 300-acre environmental complex, including an arboretum, aquarium, museum, and a McConnell-supported $23 million pedestrian bridge over the Sacramento River designed by world-famous Spanish architect Santiago Calatrava.
A click to the website’s grants page notes that the McConnell Foundation has for the indefinite future suspended accepting new grant applications, noting at the bottom that the Foundation “continues to research the merits and costs of the proposed California Horse Park at Gore Ranch in South Redding”.
That’s not quite accurate. The Foundation is hardly researching the merits and costs. It is the prime mover and sponsor for a new equestrian center to be built at the 1,800 acre Gore Ranch. The head of the foundation has made his interest clear: “There’s no place in Redding to rent a horse and go for a trail ride. There’s very few boarding places to board horses, so I think this is a potential opportunity for the community to have something that is rarely this close to a city.” (web.redding.com/specials/where_we_live/stories/200306301o065.shtml)
The Foundation’s plans for what is calls an equestrian center includes a 9,000 seat indoor event center and trade show area, including space for the Redding Rodeo two outdoor arenas, horse barns, stalls, and riding trails.
The deal is that the Foundation has committed $30 million for the equestrian center and will put in another $25 million, apparently as a program related investment, which would be reimbursed from sales and hotel taxes paid by horse park users. In addition, the Foundation wants the city and county to put an additional $23 million in bond financing into the project plus an additional $7 million in infrastructure costs such as roads and sewers, though some reports put the expected public sector commitment at $55 million. Nearly every news report describes the estimated 100,000 to 160,000 users of the park as “well-heeled” horse enthusiasts. Total costs seem to lurch from $53 million to $106 million.
Those attracted to the deal look at projections from a McConnell-commissioned study that the horse park would generate $45 million in economic benefits for the region plus $1.5 million in annual tax payments, though it’s difficult to figure out if that is before or after the cost of debt service to retire the $25 million in public bonds.
The Foundation’s horse park, dependent on significant public subsidies, has been discussed with extensive public disclosure, so one might guess that the deal, even though it’s targeted to the affluent horse set, fits within the unbelievably broad concept of what is legal in philanthropy. The ultimate justification of the philanthropic investment in the horsepark, not unlike the Bradley Foundation’s $20 million PRI for Milwaukee’s Miller Park or the El Pomar Foundation’s financing of the El Pomar Youth Sports Complex, both projects whose public benefit is more in the area of broadly defined economic development than specific services to disadvantaged and disenfranchised populations, unless you think of the owners of the Milwaukee Brewers major league baseball team as needy. For Redding, the horse park ‘s estimated 40 horse shows, seven trade shows, and 5 concerts a year could spur over 1,000 new permanent jobs according to foundation consultants (www.redding.com/redd/nw_local/article/0,2232,REDD_17533_4157463,00.html)
Even within that broad picture of potential benefits to the Shasta county community, a few components of the Foundation’s expectations might raise eyebrows:
$15 million of the project cost is apparently the cost of the Gore Ranch, which the Foundation owns, suggesting that a good chunk of the financing will circulate back to the foundation’s coffers.
The Foundation has made it clear that it expects an up-front commitment from the City and County for public subsidies even though it really can’t say what the ultimate cost of the project might be, and it wants the public agencies to reimburse any costs over $60 million (ww.redding.com/redd/sp_outdoors/article/0,2232,REDD_17583_4060241,00.html). The Foundation has offered to guarantee the city and County bond debt service, estimated to be $2.5 million annually, but the Foundation wants to take any revenues over that amount if its guarantee isn’t needed.
The horse park will be run by a nonprofit created and controlled by the Foundation itself, governed by the foundation’s own board of directors, assisted by “an advisory committee of horse and entertainment industry experts” according to the Foundation CEO. In other words, the $30 million investment that McConnell says it will invest and never see again will actually go into a park that is controlled and run by the Foundation itself.
Saddle up, all you people inclined to cutting, reining, and dressage. You’ll get a foundation-funded equestrian park, with a substantial infusion of public sector investment. But it’s not quite a foundation grant to some arm’s-length third party grant applicant. It’s a project of the foundation, by the foundation, and run by the foundation, a foundation self-directed grantmaking trend that is not all that unusual lately. Giddy-up!
Located in Shasta County, Redding is a small city of 80,000 people, more than 85% white, a largely Republican community represented in Congress by 10-term arch-conservative Wally Herger. The big philanthropic player in Redding is the McConnell Foundation, one of the largest private foundations north of San Francisco, founded by the late Carl and Leah McConnell, wealthy through real estate investments plus major holdings in Farmer’s Insurance Group.
With a mission to “help build better communities through philanthropy,” McConnell’s $11 million in grants in 2004 supported a handful of educational programs and scholarships, nearly $200,000 in employee matching gifts, $100,000 for “program consultants”, listed in the Foundation’s list of grants, $92,000 for Redding’s July 4th fireworks, and $280,000 for continuing work in Nepal as McConnell’s international program. The Foundation’s operating costs were another $8,000,000, including the CEO’s salary of $326,000, a sizeable admin hit for a grants portfolio of only $11 million, though the foundation would probably point to the $3 million that it devotes to its 400-acre Lema Ranch headquarters in explanation.
The bulk of McConnell’s grantmaking went to the Turtle Bay Exploration Park, including a $7.2 million gift to the Turtle Bay endowment. The Park is a 300-acre environmental complex, including an arboretum, aquarium, museum, and a McConnell-supported $23 million pedestrian bridge over the Sacramento River designed by world-famous Spanish architect Santiago Calatrava.
A click to the website’s grants page notes that the McConnell Foundation has for the indefinite future suspended accepting new grant applications, noting at the bottom that the Foundation “continues to research the merits and costs of the proposed California Horse Park at Gore Ranch in South Redding”.
That’s not quite accurate. The Foundation is hardly researching the merits and costs. It is the prime mover and sponsor for a new equestrian center to be built at the 1,800 acre Gore Ranch. The head of the foundation has made his interest clear: “There’s no place in Redding to rent a horse and go for a trail ride. There’s very few boarding places to board horses, so I think this is a potential opportunity for the community to have something that is rarely this close to a city.” (web.redding.com/specials/where_we_live/stories/200306301o065.shtml)
The Foundation’s plans for what is calls an equestrian center includes a 9,000 seat indoor event center and trade show area, including space for the Redding Rodeo two outdoor arenas, horse barns, stalls, and riding trails.
The deal is that the Foundation has committed $30 million for the equestrian center and will put in another $25 million, apparently as a program related investment, which would be reimbursed from sales and hotel taxes paid by horse park users. In addition, the Foundation wants the city and county to put an additional $23 million in bond financing into the project plus an additional $7 million in infrastructure costs such as roads and sewers, though some reports put the expected public sector commitment at $55 million. Nearly every news report describes the estimated 100,000 to 160,000 users of the park as “well-heeled” horse enthusiasts. Total costs seem to lurch from $53 million to $106 million.
Those attracted to the deal look at projections from a McConnell-commissioned study that the horse park would generate $45 million in economic benefits for the region plus $1.5 million in annual tax payments, though it’s difficult to figure out if that is before or after the cost of debt service to retire the $25 million in public bonds.
The Foundation’s horse park, dependent on significant public subsidies, has been discussed with extensive public disclosure, so one might guess that the deal, even though it’s targeted to the affluent horse set, fits within the unbelievably broad concept of what is legal in philanthropy. The ultimate justification of the philanthropic investment in the horsepark, not unlike the Bradley Foundation’s $20 million PRI for Milwaukee’s Miller Park or the El Pomar Foundation’s financing of the El Pomar Youth Sports Complex, both projects whose public benefit is more in the area of broadly defined economic development than specific services to disadvantaged and disenfranchised populations, unless you think of the owners of the Milwaukee Brewers major league baseball team as needy. For Redding, the horse park ‘s estimated 40 horse shows, seven trade shows, and 5 concerts a year could spur over 1,000 new permanent jobs according to foundation consultants (www.redding.com/redd/nw_local/article/0,2232,REDD_17533_4157463,00.html)
Even within that broad picture of potential benefits to the Shasta county community, a few components of the Foundation’s expectations might raise eyebrows:
$15 million of the project cost is apparently the cost of the Gore Ranch, which the Foundation owns, suggesting that a good chunk of the financing will circulate back to the foundation’s coffers.
The Foundation has made it clear that it expects an up-front commitment from the City and County for public subsidies even though it really can’t say what the ultimate cost of the project might be, and it wants the public agencies to reimburse any costs over $60 million (ww.redding.com/redd/sp_outdoors/article/0,2232,REDD_17583_4060241,00.html). The Foundation has offered to guarantee the city and County bond debt service, estimated to be $2.5 million annually, but the Foundation wants to take any revenues over that amount if its guarantee isn’t needed.
The horse park will be run by a nonprofit created and controlled by the Foundation itself, governed by the foundation’s own board of directors, assisted by “an advisory committee of horse and entertainment industry experts” according to the Foundation CEO. In other words, the $30 million investment that McConnell says it will invest and never see again will actually go into a park that is controlled and run by the Foundation itself.
Saddle up, all you people inclined to cutting, reining, and dressage. You’ll get a foundation-funded equestrian park, with a substantial infusion of public sector investment. But it’s not quite a foundation grant to some arm’s-length third party grant applicant. It’s a project of the foundation, by the foundation, and run by the foundation, a foundation self-directed grantmaking trend that is not all that unusual lately. Giddy-up!
posted by NCRP at
3:45 PM
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