Foundation for Community Building

photo courtesy of CUNA Mutual

It’s been said that businesses invest in their communities so that employees have a great community to enjoy when the whistle blows. Some companies have chosen to invest in Greater Madison by setting up foundations or endowments, and they have simple advice to others contemplating the same: define your focus, make sure it’s an unmet or under-served need, and get your employees involved.

IB interviewed people behind two such philanthropic efforts. Here’s how they work:

CUNA Mutual Group Foundation

There are two themes that govern CUNA Mutual Foundation’s approach to grant-making: one, to provide support for initiatives that make a difference in lives of children, primarily young children; and two, promote collaboration among Madison area nonprofits.

Steve Goldberg, executive director of the Foundation, which was established by CUNA Mutual Group, said the best example is its Kinder-Ready initiative, which provides funding for programs that prepare low-income minority children to be ready to learn on the first day of kindergarten. Kinder-Ready is a collaborative effort that is being implemented by Children’s Service Society of Wisconsin in partnership with the Madison Metropolitan School District, Dane County Department of Human Services, Family Enhancement, and United Way of Dane County.

The program has three areas of focus: one is home visits, where case workers visit the homes of families that have expressed an interest in preparing their young children for kindergarten. Second, there is a series of classes for parents to prepare them and equip them to be their children’s first teacher, covering the importance of reading, numbers, letters, spelling, colors, and so forth. The third focus is on educational play, or play as a tool for learning with a series of play-and-learn sessions.

The Foundation believes that if a child is introduced to an aspect of art that resonates with him or her, it can positively impact the trajectory of their education and their lives. With that, CUNA has a foundation grant that funds the Madison Museum of Contemporary Art’s “Art Zone” initiative, which introduces minority children to sculpture, painting, or another artistic pursuit.

“We hear feedback from their teachers that the Art Zone has had a very significant positive impact on students’ sense of curiosity, sense of wonder, and other things that prove really valuable in their classroom success,” Goldberg said.

The Foundation is a single-source foundation whose annual funding is underwritten by a portion of the net income of CUNA Mutual Group. The Foundation has a board of directors and a 10-member employee philanthropy team that helps shape grant-making strategy, and gifts about $1 million a year.

CUNA Mutual Group employers were extremely influential in establishing the mission. “They voted on what community outcomes were of highest priority to them as people who work and live in the Greater Dane County area,” Goldberg said. “By far, the top priority for employees was to make sure that at-risk kids are prepared for success in school and life.”

Foundations can be structured in several ways, including as tax-exempt 501(c) (3) organizations, but whatever a company does, Goldberg said it should fit within its overall business strategy, its brand, and with employees’ priorities when it comes to community impact.

CUNA Mutual Group Foundation always had placed an emphasis on youth, but it was only a few years ago that the focus was more precisely defined to serve at-risk youth, and employees drove that focus. Goldberg said it formalizes what had been done before, and helped shift dollars in a more impactful way.

“It helped us focus some major investments instead of applying $1,000 here, or $1,000 there,” he said. “We made some major investments in Kinder-Ready and some other youth-oriented initiatives. That’s where I think the difference really is. It has helped us concentrate some dollars in these areas, and it has helped us stick with it rather than migrating from one theme to another every couple of years.”

That is perfectly aligned with advice Goldberg has for other companies contemplating a foundation — to get in tune with their employees’ community priorities and to choose an approach to philanthropy that is consistent with the company’s overall business strategy. “I think the company needs to understand the outcomes that are most critical to the success and to the quality of life in our community,” he said. “Maybe they can pick a piece of that, or a niche that they think they can have a core competency in or a special interest in, rather than just giving to everything.”

To address the possibility of a large funding dip in difficult economic times, CUNA Mutual Group established a formula to fund its Foundation with a certain percentage of a rolling three-year average of its net operating gain. That way, peaks and valleys of the company’s revenue stream won’t significantly change the amount of money it can give back to the community. The intent is to try to keep that dollar amount relatively stable regardless of what happens to the economy.

Endowed by Brat Fest

Tim Metcalfe, president of Metcalfe Markets, said his grocery business is in the process of building the Brat Fest Community Endowment Fund in partnership with the Madison Community Foundation. The Foundation is tied to the annual Brat Fest event at Alliant Energy Center, which already has contributed $700,000 to various community groups whose volunteers work Brat Fest for $8 an hour, and return those earnings to the their respective groups.

Net income generated from the event will be applied to the Foundation, but getting to the point of profitability has taken a while. In the past, whatever money Brat Fest brought in was paid out to volunteers that worked it. When it moved from Hilldale Shopping Center to Alliant Energy Center five years ago, it took a sizeable loss due to unanticipated expenses, something Metcalfe wasn’t prepared for.

Metcalfe’s Markets got a better handle on the volume at Alliant as opposed to Hilldale, and after raising some prices and dialing back the schedule, the event was repositioned for growth. Now, after clash-flowing for the past two years, Brat Fest is making more money than it pays out, and it has added more family-friendly touches like carnival events and rides and music stages for local acts, and it has landed a key sponsorship from Johnsonville.

Four Metcalfe staffers are involved in producing the event, but it’s really run by anywhere from 4,500 to 5,000 paid volunteers who are, in effect, raising money for more than 70 community organizations. They represent everything from Special Olympics to the Madison East Wrestling Club, serving the estimated 120,000 attendees. Those attendees consume more than 208,000 brats.

Once the event turned the profitability corner, the next concern was about what should be done with the excess. The Metcalfes could have put it in a rainy day fund to cover payments to volunteers in the event of rainouts during Brat Fest’s four-day run on Memorial Day weekend, or it could start an endowment that would be used to give back to community. The endowment’s beneficiaries have not been identified yet, but the goal is to distribute 5% of whatever is placed in the endowment annually and have organizations apply for the funds.

According to Tim Metcalfe, the same family friendly values associated with the event would be the types of things the endowment would support. “In conjunction with Madison Community Foundation, we’ll try to come up with what those criteria might be,” said Metcalfe, whose father Tom Metcalfe started Brat Fest 28 years ago as a way of showing customer appreciation. “If you were to ask me what I think they might be, it would be things that the people who come to Brat Fest support.”

The value of having a signature, community-building event, and the opportunity to grow an endowment is not lost on Metcalfe. “Brat Fest has really been a great event for us to connect us with the community,” he noted. “It’s really kind of our way of giving back.”

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