When the Indianapolis Police Department wanted to try a new approach to reaching juvenile offenders, or the city’s art museum saw a rare opportunity to add to its post-impressionist collection, they were able to turn to a good neighbor.
The same was true in Battle Creek, Michigan, when the city faced a major renovation of its downtown area.
Happy the person who lives in a town with a big foundation—especially a foundation that has a strong regional focus. Indianapolis and Battle Creek both have benefited mightily from the presence of important philanthropic organizations.
Indianapolis boasts the Lilly Endowment, established in 1937 by three members of the family behind pharmaceutical giant Eli Lilly and Company. Battle Creek is home to the W. K. Kellogg Foundation, established in 1930, whose eponymous founder made that city in western Michigan the breakfast cereal capital of the world. Each organization trumpets its devotion to its regional roots, and each has made that devotion tangible in numerous ways that reflect the organizations’ philanthropic interests.
Lilly Endowment communications director Gretchen Wolfram observes that private foundations are in a unique position when operating close to home, one that gives them a different set of concerns than a community foundation would face. “We enjoy a measure of freedom in making our funding decisions,” she says, “since we don’t have to account to a list of donors, the way a community foundation would.”
At the same time, being a good hometown Samaritan is not without its delicate aspects. “As an independent entity, we have to tread carefully,” she added. “We don’t want to exercise too much influence over other agendas being pursued in the community, and we have to be concerned about maintaining broad support, both among the general public and with the groups we work with. We have long-established relationships with most of our grantees.”
Catherine Lucas, who has served on the committee developing the Kellogg foundation’s new strategic plan, also notes that local prominence and close relationships can create complications. “It’s a good thing, in that it gives you immediate insights into what the needs really are,” she says. “But it can also put the foundation under a lot of pressure it wouldn’t face funding programs in places where it doesn’t have exposure on a daily basis.”
James McHale, a Battle Creek native who directs Kellogg’s local programs, underscores those concerns, noting that a foundation with ambitious goals often has to do a lot of basic spadework to build a strong base of local groups that can accomplish what the donor has in mind. “You don’t always have the model organization or the model operating concept available to you locally,” he says. “But you have to dance with who’s in the gym.”
To New Zealand and Back
Why do two world-class givers focus so much of their energy and resources locally? According to Lilly president Clay Robbins, his organization’s efforts reflect the founders’ commitment to the city and state they felt “had been so good to them.” Writing in a recent foundation report, Robbins observed that two-thirds of the foundation’s spending stays in-state.
Gretchen Wolfram insists that this commitment goes beyond annual report boilerplate, and that the founders really did feel strongly that the people of Indianapolis and Indiana had been a large part of their company’s success. “From the beginning,” she says, “they demonstrated an interest in giving back to their community and home state.”
For both Lilly and Kellogg, the local contributions have been critical to their hometowns.
Lilly funds an eclectic mix of area programs and projects that fall within its three main areas of interest: community development, education, and religion.
Under the “community” heading, the endowment provided three years of funding to help the Indianapolis Police Department organize a unique crime deterrence effort, pioneered in New Zealand, called Restorative Justice. The program brings juvenile first offenders together with their victims and victims’ families to reflect on the damage their crimes have done and attempt to make personal amends.
Also, last year Lilly concluded a decade-long initiative called Giving Indiana Funds for Tomorrow. GIFT has underwritten a wide variety of community projects all over the state, granting nearly $400 million for everything from library restoration to building childcare facilities, to purchasing vehicles and equipment for fire companies.
The foundation’s definition of community development is quite broad, and includes aid to local arts organizations. Lilly recently gave $20 million to help the Indianapolis Museum of Art acquire 17 paintings and 84 prints by Paul Gauguin and other post-impressionist masters. That gift topped a long list of funding efforts for theater companies, film festivals, and other creative endeavors throughout Marion County (metropolitan Indianapolis).
While most of Lilly’s religion-related funding is national, four years ago the foundation established the Indianapolis Center for Congregations. That organization provides help to area churches of all denominations in fundraising as well as with administrative effectiveness, and even preaching improvement. Lilly also has a program called Clergy Renewal for Indiana Congregations, which provides fellowships to aid pastors through additional training and either personal or professional development. (Similar support is offered to teachers, librarians and artists.)
The Lilly Endowment is somewhat unusual among philanthropic organizations in that it is willing to provide general operating support for the groups it assists, not just construction money or program support. Ramona Baker, director of the Arts Council of Indianapolis, notes that Lilly “provides whatever help is needed. They’re extremely collaborative.” She points to Calderfest, a recent multi-faceted/multi-media arts program (named for sculptor Alexander Calder), which involved some 60 area creative organizations and facilities, as an example.
Eugene Temple, executive director of Indiana University’s Center on Philanthropy, underscores the value of Lilly’s funding approach. “They’re unique in that they help to build infrastructure that then generates giving from other sources. They’ll fund training and development programs, even capital campaigns. For instance, they’ve endowed the operating costs for our local United Way. All of that helps to make nonprofits self-sustaining.”
The foundation’s collaborative bent is very evident in the GIFT program, which has had a major impact on Hoosier life through cultivation and support of community foundations. Since GIFT was launched in 1990, the number of such local groups in Indiana has grown from fewer than a dozen to more than 90 statewide.
Hands on in Battle Creek
Some 200 miles to the north, Battle Creek’s Kellogg Foundation combines a strongly regional focus with an emphasis on leadership development, an interest it has pursued since its very first undertaking, the Michigan Community Health Project. Launched in 1930, MCHP provided training and support for improved health care and health education in seven rural Michigan counties. It established citizens’ councils to identify children’s health needs; funded medical exams, dental care, and summer camps; and even installed central heating and indoor plumbing in one-room schoolhouses, common throughout Michigan at the time.
Since then, despite extending its activities around the country, as well as to Latin America and southern Africa, Kellogg has continued to focus on Michigan, especially the Battle Creek metro area. Kellogg money has supported a wide variety of civic programs and public facilities. The Binder Park Zoo has been a major beneficiary, as has the Family Y Center. And the foundation has been the prime mover in the redevelopment of downtown Battle Creek, where it has located its impressive headquarters complex.
More recently, Kellogg funded park development in the nearby village of Homer. It also underwrote the purchase of 15 small aircraft and a flight simulator for the Western Michigan University College of Aviation training facility at Battle Creek’s W. K. Kellogg Airport.
The concept of partnership is a recurring theme in Kellogg funding efforts. In fact, the foundation has devised a strategic plan that will make the partnership idea a formal element in all Battle Creek-area programs. Developed with help from six representatives of key community organizations, the plan aims at zeroing in more closely on area needs that are consistent with the foundation’s funding priorities, as well as leveraging Kellogg resources by drawing in other donors and creating programs that can sustain themselves, both financially and operationally.
Kellogg’s James McHale explains that the foundation strives to do its part in community programs, but doesn’t want to be the dominant player. “We try not to flood the engine,” he says. “We don’t want people to assume that if something needs to be done, Kellogg will take care of it. It’s important to have a broad base of participation, so we generally aim at providing a maximum of 40 percent of funding in any project.”
Strategic giving is only part of the picture. Kellogg sees the cultivation of grassroots leadership as critical, and it puts more resources than just money into the effort. The foundation offers hands-on involvement by its own staff members as well as outside consultants for training and assistance—a measure of management sophistication that most area organizations would likely never be able to obtain by themselves.
It also maintains an experts-in-residence program that has brought prominent figures such as poet Maya Angelou, the late UPI White House correspondent Helen Thomas, and Arun Ghandi, grandson of the famous Indian leader, to the area to help motivate local leaders. A fundraising workshop has been considered, as well, and there are plans to conduct a fundraising school using experts from the nearby Indiana University Center on Philanthropy.
Writing in the organization’s 1999 annual report, foundation chairman William E. LaMothe explained the rationale behind Kellogg’s concern with leadership development. Despite the current fascination with technology and its global reach, communities “still need leaders who can canvass neighbors to sign a petition, or speak out at a city council or school board meeting. There is no substitute for people who are accessible and physically present on a daily basis.”
Jim Hettinger, who heads a city agency called Battle Creek Unlimited, acknowledges the impact of Kellogg’s people-to-people approach, noting that Kellogg president and CEO William Richardson has even agreed to chair a technology development group in Calhoun County. “BCU has always looked on the Kellogg Foundation as more than just money,” Hettinger told the Battle Creek Enquirer. “A lot of people that administer their programs are genuine experts in their fields.”
The impact of such direct participation is underscored by Catherine Lucas, who represents NonProfit Alliance, an organization that provides support services to area charities and community groups. “The resources which large foundations have in people are often even more valuable than what they bring to the table in terms of money,” she says.
Kellogg had an opportunity to demonstrate the strength of its commitment to its home base last year when it made good on $8 million in pledged local support, despite cutting back on all other funding throughout the world. In recent years the foundation has taken a big hit from a precipitous fall in the value of its stock in Kellogg Co., holdings that account for 75 percent of the foundation’s $6.2 billion in assets. But while Kellogg’s worldwide giving fell from $300 million to $203 million in 1999, funding in Calhoun County, which includes the city of Battle Creek, actually rose from the previous year’s $5.9 million of local giving.
McHale notes that the Kellogg Foundation’s local focus represents a continuation of founder W. K. Kellogg’s personal devotion to the city he made famous. But he also admits that there is a “self-interest” aspect that reflects the competitive reality of the nonprofit sector.
“We try to bring the very best people we can to this foundation, from all over the country,” McHale says. “We want Battle Creek to be the kind of community where accomplished, professional people would choose to live, as opposed to choosing other communities. So we do what we can to upgrade the schools, to attract business to the area, to improve the quality of life generally.”
William J. Koshelnyk is a freelance writer who lives in Michigan.
