VCCF’s Fiscal Assessment and Recommendations on Target
VCCF’s Fiscal Assessment and Recommendations on Target;
Attorney General Findings Support Foundation’s Report
Green Light to Implement New Fiscal Policies
Camarillo, CA – MARCH 23, 2017 – In a much anticipated report, California’s Office of the Attorney General confirmed Ventura County Community Foundation’s (VCCF) earlier findings with respect to VCCF’s prior financial issues that the Foundation released June 22, 2016.
In September 2015, VCCF self-reported its financial issues to the AG’s office providing extensive, detailed assessments of the concerns in addition to rigorous cost cutting and proposed self-corrective actions. Subsequently, working closely with the AG’s office, VCCF proposed a reimbursement plan and new oversight procedures. The AG’s letter instructs VCCF to take three corrective actions encompassing upgraded fiscal management policies, replenishment of certain restricted funds, and training for current and future board members. It also stipulates that VCCF’s agreement to take the corrective actions will not be seen as a concession of any wrongdoing by the prior Board.
Scott Hansen, who joined the VCCF Board in fiscal year 2014, and was appointed Chair this past January, said, “Though the AG did not publish its report, VCCF requested and was granted permission to share its findings. It was good we acted immediately on what we discovered as the letter did not contain any surprises. We deeply appreciate the AG’s guidance in this process and began implementing corrective action a year ago based on the assessment provided by our current CEO, CFO and their team.”
According to the AG’s Letter:
- VCCF’s prior management and board held unreasonably optimistic expectations in its prior capital campaign leading to the purchase of VCCF’s office building. In purchasing the building, VCCF improperly used $3.8 million of endowment funds earmarked to support VCCF’s operations.
Corrective Action: VCCF to restore those funds upon sale of the building or its final mortgage payment.
- VCCF’s prior management and board made improper, over-investment of permanent funds into money market accounts and other observations found in the Foundation’s independent fiduciary review conducted by KPMG.
Corrective Action: VCCF to replenish $1.8 million of lost (under-earned) investment income to the various affected funds, and to work with an independent consultant to develop new procedures and policies.
- Current and future members of VCCF’s Board must receive additional training on their fiduciary duties within six months of the letter or their respective date of Board appointment.
VCCF Chief Executive Officer, Vanessa Bechtel, who began her tenure in February 2015 said, “We’re pleased to put this difficult chapter behind us and to continue to be a local and independent foundation, focused on serving Ventura County residents.”
Since last June, Bechtel and her management team have met with over 300 donor families and nonprofit agencies and shared the Foundation’s plans to correct and improve operations in light of the anticipated report. More than one hundred additional meetings are calendared through the summer.
“I am especially grateful to our donors and supporters for sticking with us through a challenging time,” Ms. Bechtel added. “This reflects both our commitment to transparency as well as our 30-year track record of providing critical support to VC residents ranging from scholarships to programs for our disadvantaged residents.”
In 2016, VCCF raised approximately $2.1 million in capital, and disbursed $3.5 million in funds on behalf of its donors for numerous philanthropic causes, programs and activities.
Charles Maxey, VCCF Board member and Chair of Personnel Committee said, “It takes a person of exceptional courage and integrity to right the ship. We have the right CEO in Vanessa and her leadership throughout this journey proves the Board made the right choice in hiring her.”
“CFO, Bonnie Gilles, who was recruited just prior to Vanessa’s hiring, was invaluable in developing the financial restructuring solutions that helped enable VCCF to remain independent and continue operations upon which thousands of VC residents rely,” adds Maxey.
Gary E. Erickson, current VCCF Board member who served as its previous chairman, notes, “No one wanted this report more than us. It isn’t always easy, but transparency is the only path to fully restoring the trust and confidence of our donors and the community we serve. We regret the path that led to this situation and are taking aggressive steps to ensure it will never happen again. Going forward, we can never be too vigilant.”
According to Hansen, that dedication is shared by the remaining board members who have redoubled their efforts to strengthening the Foundation, “Our current Board is 100% committed to not only implementing the AG’s recommendation but adding even more safeguards and training for our staff. We look forward to future board members joining forces in enhancing philanthropic services to all of Ventura County.”
The tradition of charitable giving never stopped despite the fiscal corrections the foundation is making, according to Bechtel. “It is incredibly exciting to meet with our local philanthropists and hear about their visions for making Ventura County’s resources accessible to all residents. Seeing donor contributions in action is a real joy and privilege,” she says.
VCCF invests the charitable capital that drives the philanthropic engines of Ventura County. The Foundation was established in 1987 and endeavors to build philanthropy in the region and to give generously for the wellbeing of all in Ventura County.