City Council happy so far with changes to Arlington Tomorrow Foundation
05/23/2014 1:26 PM
05/23/2014 1:27 PM
The Arlington Tomorrow Foundation, a charitable endowment that manages a significant portion of the city’s natural gas revenue, has undergone a makeover during the past year.
Since its inception in 2007, the foundation had been governed by a board of three City Council members and two residents. But last fall, the council adopted a new governance structure that resulted in the foundation board being made up of the entire nine-member council.
Instead of having residents on the board, the restructuring created a five-member citizens advisory committee that meets monthly to review grant applications and make recommendations to the board. The council also voted to cap the endowment at $100 million, about $5 million less than it has now.
Council member Kathryn Wilemon said she supported the restructuring because she believes elected officials should make the final decisions on disbursal of the foundation’s money, which comes from wells that pull natural gas from beneath public property.
“We believe the council has the ultimate responsibility for public funds,” said Wilemon, a past president of the board.
Mayor Robert Cluck, who is now board president, said that the panel in its previous configuration “did an amazingly good job.” But he said the council needed to be more involved.
“I think we like this system better,” he said.
$100 million cap nears
Because the gas well revenue has grown more quickly than expected, the council also decided last fall to cap the amount of bonus and royalty payments going into the endowment at $100 million. The foundation started with a $25 million investment but is now at $95 million.
Once the $100 million is reached, which is expected to occur by Dec. 31, the flow of revenue into what is referred to as the foundation’s corpus will cease and it is expected to be self-sustaining.
“I’m very much in favor of it,” Cluck said of the cap. “$100 million will grow if we handle it correctly.”
After the revenue stops going to the endowment, it will go into gas funds for general city uses, parks and the Arlington Municipal Airport, said Mike Finley, the city’s chief financial officer. Arlington receives $14 million to $15 million a year in gas well revenue.
The council created the foundation to invest and manage a significant portion of the revenue from natural gas leases involving public property. The endowment uses interest earnings off its invested assets to issue matching grants to city departments and charitable organizations for projects and services that benefit Arlington residents.
At the time, city leaders said that instead of allowing all of the gas revenue to stream into the city’s general fund, they wanted to invest some of it for the future.
Since then, the foundation has contributed $8.6 million to 290 projects, said foundation Executive Director Carolyn Mentesana. Those projects run the gamut from a mobile pet adoption unit, high school fire department academy and Meals on Wheels to cancer care programs and rape crisis counseling.
“There but for that vision, none of this would have been possible,” Mentesana said.
More changes for the foundation could be forthcoming. The council will have a retreat at the Arlington Convention Center on June 3 to evaluate the foundation and how it is operating.
The retreat will also help council members who are new to the board get more familiar with the organization. Cluck said any changes would probably be along the lines of fine-tuning the foundation.
“I think we’re operating very efficiently,” he said.
Latest grants approved
At a May 20 meeting, the restructured board navigated its way through 10 grant requests. Although most of the advisory committee’s recommendations were approved, some board members balked at grant requests that wouldn’t benefit large numbers of Arlington residents.
For instance, a request from the Make-A-Wish Foundation for $10,000 to underwrite the wishes of two Arlington children was denied. Members said it was a worthy cause, but some felt it did not have enough community impact.
But the majority of grants won approval, among them $35,000 for the “Ansel Adams Masterworks” exhibit at the Arlington Museum of Art, $100,000 for a passenger bus to serve the city’s senior centers, $130,000 for lighting at Vandergriff Skatepark and $100,000 to install new playground equipment at Bob McFarland Park.
$4 million for library?
A grant application for the largest amount of money ever requested of the foundation is expected this summer. City staff members are recommending that $4 million for a new central library downtown come from the foundation’s $5 million reserve fund.
That fund, which was created from capital gains, had been set aside “for a large project that could have major impact,” Mentesana said.
The board has also discussed using the reserve to give grants during years when interest earnings fall short, but Cluck said it could be used for both that and the proposed $25 million library, which could replace the 40-year-old George W. Hawkes Central Library east of City Hall.
The current library needs extensive repairs and is too small to meet the public’s demands, according to city staff.
“Our library is pretty much in shambles,” Cluck said. “This project is one for the entire city.”
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