Thursday, April 03, 2008

Forest City Ratner's shadowy foundation, under the radar, dispenses $1.7M

Forest City Ratner aggressively announces local philanthropy such as basketball clinics and Double Dutch clinics. However, it's much quieter about the activities of its corporate foundation, which over the past three years has given away nearly $1.7 million, including six-figure annual gifts to local institutions like the Brooklyn Academy of Music (three years) and the Brooklyn Museum (two years), plus gifts of $80,000 and $100,000 to the Brooklyn Children's Museum in two years.

There's no web site for the Forest City Ratner Companies Foundation; a Google search turns up a handful of press and web mentions. There's no separate phone number. Indeed, a filing with the Internal Revenue Service provides the same number, 718-923-8400, as the company switchboard, blurring the distinction between company and foundation. (Click on all graphics to enlarge.)

The five officers who run the foundation are all Forest City Ratner employees, four of them top executives. There's no evidence, at least on the web, of the foundation's criteria for giving grants nor an opportunity to apply for them. Nor is there an evident fundraising apparatus. (Note that the foundation is technically a public charity, not a private foundation.)

Vague mission

And the foundation, established in 2004, has a vague, almost tautological mission: "The Foundation has been established by Forest City Ratner Companies... for the charitable purpose of stimulating and encouraging charitable contributions and activities as well as directing and concentrating FCRC's own charitable activities."

With no endowment, the foundation holds one major fundraising event a year, a dinner not publicly announced, which suggests that it relies on contributions from company employees and others associated with it. In "directing and concentrating FCRC's own charitable activities," the foundation in part may help the developer maintain good relationship with a variety of nonprofit and cultural institutions, especially those in Brooklyn.

Skirting best practices

While the law apparently gives wide latitude to such foundations, the operations of the Forest City Ratner Foundation do seem to fall short of some best practices recommended by the Council on Foundations (COF).

In Stewardship Principles for Corporate Grantmakers, the COF states:
V. We recognize and act upon our obligations to multiple stakeholders: the corporate donor and its directors and employees, shareholders, grantees and grantseekers, the public and governmental bodies.
...VII. We welcome public interest and communicate openly.


Officials of the company/foundation have followed the law by providing copies, on my request, of the last three years of the foundation's Form 990 report to the Internal Revenue Service. (The foundation's report for activities during Fiscal Year 2007, which ended 1/31/08, is not yet due.) And officer David Berliner, the company's general counsel, in 2006 answered some specific questions about donations.

However, Berliner did not respond to an e-mail sent on Monday asking why the foundation has no public presence and for details about the fundraising dinner.

The foundation hasn't courted publicity. For example, "aides to Ratner" declined to comment to the Daily News about donations to the Mayor's Fund to Advance New York City. A 1/16/05 Daily News article headlined Apple polishers fatten Mike fund reported:
But some donors have business links to the city - raising eyebrows among good-government groups, since the mayor has called for strict curbs on donations from city contractors to candidates in the campaign-finance program.
...Ratner donated more than $60,000 from his company and his foundation for, among other things, a long-stalled statue of Brooklyn Dodgers greats Jackie Robinson and Pee Wee Reese.


The foundation contributed $25,000 to the Mayor's Fund in 2004 (below).

Who gets what

As the relevant pages from these Form 990s show (above and right), the Brooklyn Museum, the Brooklyn Academy of Music, and the Brooklyn Children's Museum have consistently received the largest donations. BAM has gotten at least $100,000 in each of the years, while the Brooklyn Museum has received $100,000 in two of the years.

In 2004 (right), Long Island University, Polytechnic University, and the Public Art Fund each got $50,000; the Washington, DC-based American Institutes for Research, a behavioral and social science research organization, got more than $76,000.

In 2005, the Metropolitan Museum, which had gotten $30,000 in 2004, received $75,000. Universities outside Brooklyn have received support; the University of Pennsylvania got $15,000 in FY 2004 and FY 2006, while Columbia Law School, Bruce Ratner's alma mater, got $25,000 in 2005. In 2005 and 2006, Memorial-Sloan Kettering Hospital got $15,000. In 2006, Catholic Charities of Brooklyn got $25,000. In FY 2004, the New York Aquarium, which operates in Brooklyn, got $10,000.

Smaller grants have been given to a variety of charities and organizations, including Habitat for Humanity, Fairleigh Dickinson University, and Madison Square Park.

Supporting the Nets

In FY 2005, the foundation distributed $35,920 in Nets tickets via a High School Rewards Program. In FY 2006, the foundation distributed $35,000 worth of tickets. As the graphic at right shows, a majority of the schools are in New Jersey.

Forest City Ratner is the principal owner of the New Jersey Nets, which the developer wants to move to Brooklyn. The FCRC Foundation, the Nets, and New Jersey Nets Foundation have a relationship. The FCRC Foundation has distributed some $60,000 worth of tickets--Nets games often have many empty seats--to local high schools over the past two years. The two foundations have held a bowling event to raise money. And the two foundations have sold autographed Nets programs to raise money.

In another promotion, a Nets Basketbowl Fundraising Event was held 3/1/07, an initiative of the Nets Foundation in conjunction with the FCRC Foundation. The Nets Foundation, as the graphic indicates, has a more specific mission: "dedicated to improving the quality of life in the metropolitan area by supporting programs and initiatives that focus on youth, education and strengthening communities."

Where the money comes from

So who gives to the Forest City Ratner Companies Foundation? Well, we can't be sure, because the names of donors to such foundations aren't made public.

That said, the foundation's first filing contained a page (right) listing the amount of donations with the names of donors redacted. While no such page was required, the redacted page provides several clues. First, most contributions are $5000, $10,000, or $15,000, suggesting a small number of well-heeled donors. There's one large contribution of $245,000, presumably from a single donor. (A company executive?)

The Nets connection

In 2004, the New Jersey Nets Foundation gave $82,261 to the Forest City Ratner Companies Foundation, according to the former's Form 990. That in turn was reported (above) as one of the redacted donations on the Forest City Ratner Companies Foundation's Form 990.

Also, curiously enough, that Nets Foundation contribution--an irregular sum--was counted in the $680,261 collected at at the fundraising dinner.

The Foundation was formed only in 2004; that was shortly after the Atlantic Yards project was announced, though there's no evidence the two actions were related. The foundation’s initial four officers were top FCR executives: Bruce Ratner, Joanne Minieri, Berliner, and Robert Sanna, all of whom serve the foundation with no compensation. A year later, an additional FCR employee was added as an officer.

Grantees obscured?

On the 2004 Form 990 available via the charitable portal GuideStar (via the IRS), the names of grantees are redacted (right). On the 2005 form, the names of grantees are on pages that are not attached. In other words, without asking the foundation directly--as I did after first looking for the 2004 form nearly two years ago--the casual searcher would not have found the names of donors.

GuideStar's Suzanne Coffman told me that "we post what the IRS gives us, and we don’t know why the attachment was not included in the scan the IRS sent us. The longer answer is that the IRS does not usually redact the names of organizations that received grants or contributions from a Form 990 filer. In this case, the schedule may have been removed erroneously before the 990 was scanned, or the Forest City Ratner Companies Foundation may have failed to include it when they sent the return to the IRS. Unfortunately, we have no way of determining what happened."

An IRS spokesman told me that the agency doesn't redact names.

Without further investigation, and comment from the foundation--I asked on Monday--it's unclear why the grantees are obscured in the two returns available via GuideStar.

Toward transparency

The Forest City Ratner Companies Foundation's vague public presence contrasts with other, more veteran foundations that make grants in the area. For example, the Keyspan Foundation, now based in Hicksville but once in Brooklyn, describes its Mission & Philosophy, its focus on Education and the Environment, lists the Board of Directors, and offers guidelines and policies.

The Independence Community Foundation, based in Brooklyn, also offers an extensive array of information. It more clearly reports the names and addresses (right) of grantees.

No comments:

Post a Comment