When my grandmother Jenny, and my father Elmer, began the Foundation through a declaration of trust 50 years ago in 1955, they did so both out of concern and with purpose. They believed that by assisting Alaskan non-profit organizations addressing basic needs, special circumstances, the arts and education, the Rasmuson Foundation would contribute to healthy, enriched and productive lives for Alaskans of all ages. Today, the most important role of the Rasmuson Foundation Board is to ensure that the Foundation’s grant making philosophy and programs remain consistent with their wishes which, in the world of philanthropy, are known as “donor intent.” Our primary challenge in reviewing the Foundation’s mission and philosophy each year is to successfully adapt their intent to today’s circumstances while honoring their intent.
It is my pleasure to present our third annual letter to Alaskans. As I look back at 2005, the Foundation reached three important milestones. First, it celebrated its fiftieth anniversary with a Board meeting in Homer where it did what it does best: award grants with the intent of promoting a better life for Alaskans. Second, two fourth generation family members, my nephew Adam Gibbons and daughter Natasha von Imhof, joined the Board. Third, 2005 marked the fifth consecutive year of dramatic growth for the Foundation.
We’ve traditionally structured our awards as “challenges” in order to stimulate individual and community giving. In the process of reviewing the mission and philosophy of the Foundation, the Board recognized the opportunity to refine the Foundation’s grant making program to reconfirm a key value of the founders: we place a high degree of importance on projects where the people most directly involved have invested financially. Given the family’s banking history, this should come as no surprise. All successful business bankers and venture capitalists want the principals in any business transaction to have “some skin in the game” prior to investing themselves. Why did the Board feel the need to reconfirm this value? Unfortunately and all too often, as Board members of applying organizations advocate applications to us, they themselves have not invested financially in their own organizations. We recognize that board members have varying capacities to give and that charitable giving is a personal decision. We recommend that each board member make a financial gift that is meaningful and significant by their own standard. Moving forward, applicants to the Rasmuson Foundation that demonstrate 100% board giving will receive priority in funding decisions.
In 2005, the Foundation continued its strategy of creating opportunities for Alaskans to see a return on their individual giving as we awarded $20,600,000 for 250 grants across the state, and paid out $24,086,158. We announced the first six recipients of the Sabbatical Program which provides health and human service leaders, who typically suffer from high rates of burnout, with up to six-months of paid leave. We believe this to be a first step towards increasing the average tenure of our best executives. We continued to develop the programs associated with our 10-year, $20 million commitment to the arts and named four recipients of the newly launched Creative Ventures Fund which invests in a recipient organization’s artistic future. In its second year, the Individual Artist Awards named 32 Alaskan artists from various disciplines as recipients. Poet John Haines of Fairbanks, Alaska’s 3rd Poet Laureate, received the 2005 Distinguished Artist Award in recognition of his lifelong accomplishments in the arts. We continue to develop programs such as the Pre-Development Fund, which provides early stage technical assistance to organizations considering a capital building project, to both meet unmet needs and spur innovation.
We awarded 45 large grants of strategic importance to organizations across the state. These included Christian Health Associates to provide an administrative umbrella for Anchorage Project Access which has a mission to increase access to health care for low-income, uninsured members of the Anchorage community using a volunteer network of providers. Barrow Search and Rescue received an award to support the purchase of a new rescue boat for search and rescue operations that fall within a 100 -mile radius of Barrow. There are no Coast Guard units stationed on the Arctic Slope. We are one of a coalition of private funders from across the country supporting an important five – year capacity-building project within the Alaska Community Foundation. The project’s ultimate goal is to build the necessary infrastructure to allow for the increase of their managed assets from $12 million to $50 million by 2010. We awarded a challenge grant to the New Koliganek Village Council for construction of family resource center and clinic. Finally, we partnered with the citizens of Petersburg who passed general obligation bonds in the amount of $5.8 million to support the City of Petersburg‘s new state-of-the-art community aquatic center.
At the same time, we took great pride in awarding 115 small capital grants during 2005 to organizations such as Anchor Point Senior Citizens for equipment to enable community emergency response training; Rural Alaska Community Action Program (RurAL CAP) for cross country ski equipment for Northwest Alaska Ski Club program to reintroduce skiing in the Arctic Northwest region; the City of Angoon for paint and equipment for totem pole renovation and weight lifting equipment for youth exercise program; the Tanana Valley State Fair Association to upgrade its facility to facilitate access for disabled Alaskans in accordance with the Americans with Disabilities Act; Soldotna Historical Society and Museum for restoration of Soldotna’s first post office to original architectural form; and Valley Community for Recycling Solutions for a forklift scale and portable canvas building to improve the recycling program in the Mat-Su Valley. Since 1955, the Foundation has awarded approximately $105 million for over 1,800 projects across the state, in the areas of health and human services, arts and culture, organizational capacity-building, community and economic development, and education.
Our ability to both continue and strengthen our commitment to Alaska relies on well-managed resources. In 2005, our assets grew to approximately $523 million. The main objective of the endowment, which is managed according to a percent of market value (POMV) approach, is to enhance its real value in perpetuity. A POMV approach means that the Foundation is committed to spend no more than a set percent of the annual average market value of its endowment. This set percent, which is slightly more than 5%, is based on a combination of IRS regulation and the expected difference between the total annual return and the rate of inflation. The Foundation continues to diversify its equity-oriented portfolio which produced a 9.28% return last year. Our investment strategy, which balances growth with risk minimization, lays the groundwork for stable, long-term growth consistent with our planned grant making activities.
I am most proud of the work performed by our board and staff to help the Foundation evolve in a manner which honors the intent of my grandmother and father while simultaneously adapting that intent to meet the needs of today’s Alaska. My father wrote that Alaskans before us had “to rely on one another to build a good community and a good life.” Because we believe this to be true, the Foundation is rarely the first, the only, or the single largest investor in projects. It is also why we felt it important to reconfirm that those who approach us for support must also have demonstrated their own financial support. But this issue is much larger than just the traditional interactions we have with nonprofits about funding. As I look into the future, one of the primary cultural issues with which Alaskans will have to grapple is our collective resolve to invest our personal resources in ourselves, our nonprofits, our communities, and our state. How and when we resolve that issue has direct implications on the type, level and frequency of investment by other private and public investors across the country who will most certainly be asking “how much skin do they have in the game?”
Edward B. Rasmuson
May 1, 2006