What’s the Foundation’s Bottom Line?
Staff editorial

A letter writer suggested in the June 2 Saddleback Valley News that the Mission Viejo Community Foundation should be shut down. The writer said, “We have no control over this foundation. Ten months after its first board meeting, it has only received $360,000 in pledges.”

Time has run out for the foundation to make a good first impression. The foundation’s goal is to raise $1 million for the expansion of the community center. Two grants to the foundation from the city – “seed money” – have cost taxpayers nearly $400,000.

Since the city has already spent the $400,000, the case could be made to let it ride. Residents should hope the foundation will be able to raise at least that much – in a sense paying back the grants. The foundation will have a fund-raiser on Sept. 11, a golf tournament at Mission Viejo Country Club. It’s a start, which some people think is overdue.

The foremost issue beyond raising cash has been raising public trust. The city council hired a consultant, Bob Zuer, to form the community foundation. Zuer stayed on the payroll, becoming the foundation’s director after it became an independent entity – a 501(c)(3) organization – with its own board of directors. As such, it has no obligation to taxpayers to reveal financial statements.

Zuer received approximately $9,000 a month as a consultant. When he became the foundation’s director at the same salary, residents began asking how many hours he works and what he does. With the wall in place between the foundation and the city, he isn’t obligated to tell. In addition to Zuer’s salary, the foundation’s other expenses include impressive-looking literature and a part-time employee.

As a new organization, the foundation hasn’t raised much money. The City Outlook magazine continues to give fund-raising “updates” by combining pledges, cash and in-kind donations. A substantial portion of early donations was supposed to come from board members and/or their employers, including city vendors. After 10 months, it’s time for them to shake the money tree and turn pledges into cash.

Ultimately, the success or failure of the foundation will become the legacy of its board members. When residents ask questions without getting answers, perhaps they’re asking the wrong people. Board members, not city employees or council members, have access to financial data.

Residents are right to have high expectations for a $9,000-a-month director. After 10 months on the job, his performance has not met expectations, and the board of directors is beginning to look more like an exclusive club than a fundraising team.

The groundbreaking for expansion of the community center is Aug. 5. Time is running out to raise money, and the foundation clock appears not to be plugged in. Ten months of marginal performance is not a reason to shut down the foundation. However, the director and board members should be keenly aware that cash is not coming out of their spin cycle.