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| First Person |
Nominal Values
Virginia Esposito
02/01/2007
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Virginia Esposito is president of the National Center for Family Philanthropy in
Washington, D.C.
After a prominent individual dies, many families want to make a large,
memorable philanthropic gift to honor the deceased. We often hear from families
in this situation at the National Center for Family Philanthropy. We also hear
from heirs who are living with the consequences of a large gift made in honor of
a family member, often with that person’s name attached.
| In some cases, heirs tell me that they realize their name might be attached with
Velcro—that is, until a bigger donor comes along. |
Those who are
thinking of creating a gift to honor someone’s philanthropic legacy—a legacy
grant—must determine how to do it just right from the beginning. Otherwise,
their grandchildren may be saddled with uncomfortable issues surrounding the way
the institution is handling the gift. Usually a legacy grant is given to an
institution, such as a university, a museum or a hospital, with the implication
that there will be a long-term relationship between the organization and the
heirs. Thus, these individuals must live with the advantages and disadvantages
of having the family name immortalized. In some cases, heirs tell me that they
realize their name might be attached with Velcro—that is, until a bigger donor
comes along. But their primary concern is maintaining a lasting legacy in a way
that measures up to the honoree’s standards while also satisfying later
generations, as well as the institution’s needs.
The large extended family
of Algur (Al) Meadows, a Dallas oil executive and one of seven siblings,
faced that three-pronged issue several years ago. Meadows, who died in 1978, had
spent many years in Spain and amassed a collection of 19th- and 20th-century
Spanish art that critics have called the most important portfolio of its kind
outside the Prado Museum. Meadows was also a supporter of Southern Methodist
University (SMU), and after his death, the family elected to continue that
support in his name. The university named its school of the arts after him and
also set up the Meadows Museum with his donations. Between 2000 and 2002, the
family held many conversations with SMU officers, trustees and the museum
directors in preparation for giving them another $20 million to build a new museum.
They continue to have discussions every time the museum curator
considers new acquisitions. At one point, they had to decide if Meadows’ legacy
was appropriate for an exhibition of Balenciaga’s fashions—it was, they thought.
In another case, they considered whether or not to purchase a private El Greco
collection, even though the artwork was not strictly aligned with the original
collection. They chose to acquire it. Fortunately for the family, Meadows left
reams of documents concerning his wishes for dispensation of his art collection,
along with a number of interviews he gave to television reporters regarding his
views on collecting art, including one of him walking through the SMU museum. In
January 2006, the family foundation gave the Meadows School of the Arts an
additional $33 million.
Ongoing gifts such as these bring up another question
common to the heirs of a legacy grant. I have met with third- and
fourth-generation heirs who think that their relationship with the recipient
institution has become messy and expensive, with a fuzzy definition of what is
expected of both the donor and the recipient. In fact, the National Center for
Family Philanthropy’s initial research on how to work with a legacy grant began
with one such family asking for advice. The heirs felt that the institution, a
university, was becoming complacent, believing that the family would contribute
to any fundraising effort. Family members also wondered if they were becoming
jaded themselves, failing to keep a watchful eye on what the school was doing
with their money.
With a large university capital campaign coming up, we
suggested to the family members that they hold a dialogue with the principal
parties at the school to let them know that they were not opposed to planning
their next big contribution. But the family, we advised, should also admit that
after years of working together in a fairly passive way, they wanted both sides
to consider what each needed to do to make this a successful partnership in the
long run. That tactic invited the grantees to also bring their needs to the
table. The family members had their turn, telling the university what direction
they would like their money to take if they made another substantial grant.
After a few of these meetings, the family held a retreat where they devised a
plan to give what turned out to be a very significant gift, but under very new
circumstances. For one, they would request that the school set some benchmarks
for its own performance.
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