Mazamas Foundation Town Hall Recap

MAZAMAS FOUNDATION DISSOLUTION TOWN HALL RECAP

On Tuesday, July 28 at 7 p.m., the Mazama Foundation conducted a Town Hall meeting (via Zoom) for Mazama members, led by Mazamas Foundation (Foundation) members and Mazama Executive Council (EC) members as a follow-up to the Foundation Dissolution discussion and FAQ listed in last month’s Mazama Bulletin. Approximately 8 Mazama members tuned in to the call. The following is a summary of that Town Hall discussion.

Jon Jurevic (Foundation member) provided a comprehensive introduction concerning how we got here. He explained the history of the Foundation, the purpose of its creation, the change in its assets over time, and why we consider it prudent to dissolve it at this point.

Marty Hansen (Mazama member) asked about the structure of the Financial Affairs Committee and the Investment Subcommittee, along with how the assets will be managed post dissolution. Traci Manning (Mazama EC President) explained that in the past the Financial Affairs Committees have focused on budget and financial oversight. The Financial Affairs Committee has not been active for quite some time. Last fall, the EC created a Finance Committee that is a subcommittee of the EC, and is chaired by the current Treasurer. The EC also just created a separate Investment Subcommitee that will meet quarterly and focus on investment oversight along with roles and responsibilities.

Ardel Frick (Mazama member) wondered if the sole reason for the establishment of the Foundation was for the protection of assets, and why it is no longer considered a necessity to have a foundation. Jon Jerevic explained that the original main reason was protection of our assets.

Mike Levis (Mazama member) asked what was the advantage of dissolving the Mazama Foundation. Multiple Foundation members discussed this and stated that dissolution would eliminate confusion among Mazama members as to why the Foundation exists and eliminate the duplicative costs of administering the Foundation. Also discussed was the complexity of raising and then transferring money from the Foundation to the Mazamas. In addition, the current assets of the Foundation are much lower than in prior years. Jerry Eline (Foundation member) made a point of clarification: the Mazamas and the Mazama Foundation are both nonprofit organizations. The Mazamas are a 501(c)(3) organization, while the Mazama Foundation is a 509(a) (3), a supporting organization. Finally, both Jon and Jerry discussed that in their substantial experience with litigation and liability insurance, the Mazamas can adequately protect their assets by increasing their insurance coverage, which they can do affordably.

Ardel Frick asked if the controversy last year between the Mountaineers and the Mountaineers Foundation, and the ensuing lawsuit, had any impact? Jerry said that we were aware of the lawsuit, but it had no influence on our decision. Ardel also asked if donors who identify the Mazamas Foundation as a beneficiary in their will or trust need to update their paperwork to name the Mazamas instead of the Mazamas Foundation? Jerry Eline (Foundation member) commented that most wills include standard language specifying that if a named organization no longer exists the executor has discretion to identify a similar organization as the beneficiary. It was suggested by Keith Thomajan (Foundation member) that a potential solution could be a DBA. This solution would need some research. Sarah Bradham (Mazamas Acting Executive Director) mentioned that donor-restricted funds at the Foundation will remain donor-restricted funds at the Mazamas. In addition at this time the Mazamas Foundation has a process in place to receive stock donation but the Mazamas do not. The Mazamas plan to set up a similar process so the organization will be in a position to receive stock gifts. Lastly, Ardel said that for some individuals, the Foundation may be viewed as an endowment where donations can be used for specific purposes but not for ongoing operations. She questioned if people would be less likely to make donation without this perceived firewall* to prevent their donations from being used for ongoing operations.

Sarah Bradham (Acting Executive Director) said that most endowments are designed to keep the principal (corpus) intact while using the investment income for charitable efforts. Donors can specify this structure when they make their donation. The ability to establish endowments including the minimum amount will be addressed as part of the fundraising strategy for the Mazamas. Because endowments may only produce usable interest (depending on the way they are setup), a minimum endowment amount at the Mazamas, according to our newly adopted Finance Policies, would be $25,000 or greater. Currently, the Mazamas and the Mazamas Foundation do not have any funds that were identified as endowments.

In summary, it appeared that the members were satisfied with the explanations, and no one in the meeting displayed or voiced concern about this dissolution decision. Note that upon dissolution, all assets would go to the Mazamas.

Next Steps: The next meeting of the Mazamas Foundation is on August 17. The agenda for that meeting will include a vote on whether to begin the process to dissolve the Mazamas Foundation. If the decision to dissolve is made, then the following day at the monthly EC meeting, the EC will conduct a vote to approve acceptance of the assets. Afterwards, the legal steps to finalize the dissolution will be followed, with the intent to finalize the process by the end of our respective fiscal years, September 30. *The Mazamas Foundation does not operate as an endowment.