In this Issue

    NCUF Hires New Executive Director

    CURA Fund Comes to a Close

    Dropping Interest Rates bring Changes to CIF

    An Interview with Pat Brownell-Sterner

    NCUF Hires New Executive Director

    The National Credit Union Foundation has named Gary Officer its new executive director. Officer replaces Pat Brownell, who announced earlier this year her plans to step down from the position.

    "I think the Board has made an excellent choice," says Brownell. "I'm leaving the National Credit Union Foundation in very capable hands."

    In his new role, Officer will work with the Foundation Board to aggressively expand the Foundation's outstanding reputation in the credit union and community development worlds. He will also be working with major private foundations, continuing to build relationships such as the one the National Credit Union Foundation presently enjoys with the prestigious Ford Foundation.

    "We couldn't be more thrilled with the selection," says John Fiore, chairman of the NCUF and president/CEO of Motorola Employees Credit Union in Schaumburg, Illinois. "Gary's diverse background and wealth of experience will serve the Foundation well. I'm genuinely excited about our future."

    Officer is an affordable housing professional who has worked in that field since 1990. During that time, he has held leadership positions with both the Lakefront SRO Corporation in Chicago and the Metropolitan Boston Housing Partnership. He earned a Bachelor of Arts (Hon) Political Science from the University of Manchester, England, in 1985 and Master of Science Msc (Econ) in Economics and International Relations from the London School of Economics in 1990.

    'Credit Unions Rebuild America' Fund Comes to a Close

    "We couldn't be more thrilled with the credit union community's response," said Gary Officer, executive director of the National Credit Union Foundation, in referring to the more than $612,000 raised for victims of the September 11 terrorist attacks through the Foundation's Credit Unions Rebuild America (CURA) Fund. The fund was opened by the Foundation on behalf of CUNA and its member leagues and credit unions on September 20.

    CUNA President & CEO Dan Mica commented, "Credit unions nationwide were aghast at the events of Sept. 11, and were searching for a way to lend support to the victims and their families. CURA provided the credit union movement with a central collection point through which the generosity of the movement could be channeled in support of relief efforts underway in New York, Washington, and other communities affected by the attacks."

    Mica, who is also president of the National Credit Union Foundation, said that many of those who perished or were injured in the Sept. 11 attacks were members of credit unions and noted the CURA fund "gave the movement a conduit through which to pour its heartfelt condolences and tangible aid to the victims of the attack and their families."

    Seventy five percent of the dollars collected through CURA were donated to the American Red Cross; the remaining twenty five percent went to the United Way's September 11th Fund.

    "This is an enormous sum of money, but it's just a portion of disaster funds raised by credit unions in the wake of the attacks," said Bruce Wheeler, director of donor & public relations for the Foundation. "The New York Credit Union Foundation raised even more money to help rebuild the credit unions destroyed in the World Trade Center, and I heard that many credit unions and credit union support organizations bypassed funds such as these and gave directly to the charities of their choice."

    Organizations that donated $100,000 or more to the CURA fund were the Michigan Credit Union Foundation ($137,000), Liberty ($105,000) and Payment Systems for Credit Unions ($100,000). Organizations giving between $25,000 and $100,000 included Card Services for Credit Unions, Illinois Credit Union Foundation, Indiana Credit Union League and Suncoast Schools Federal Credit Union.

    Dropping Interest Rates bring Changes to CIF

    NCUF announces revised formula, introduces new 5-year CD

    In response to continuing drops in interest rates, the National Credit Union Foundation has revised the distribution formula for the Community Investment Fund (CIF). The continued drop in rates has had an adverse effect on CIF, making it so that credit unions' charitable intent in participating in CIF was not being realized under the old formula.

    "CIF was never intended to be a static program, but one that is flexible in response to the market and the giving environment," says John Fiore, Foundation chairman and president/CEO of Motorola Employees Credit Union, Schaumburg, Illinois.

    The NCUF Board has adopted the following revisions to CIF:

    * A new 90-day account has been created that will be a 50/50 split between the investor and National Credit Union Foundation. This provides the most flexible option for investors who want to keep funds in a 90-day account rather than tying them up at low rates for an extended period of time. The current 90-day account, which calls for a minimum 3% return to the investor and maximum 2% return to Foundation, will be dissolved February 1, 2002.

    * A new 5-year fixed-rate CD has been created to offer higher returns, both for the investor and for the Foundation (and state foundations, by way of the National Credit Union Foundation's quarterly distributions to participating states).

    * The distribution formula on all new fixed-rate CDs, whether 3 or 5-year, has been revised. The new distribution will be the first 2% to the investor, the second 2% to the Foundation, with any additional funds in a rate environment exceeding 4% going to the investor.

    "These changes are intended to keep CIF a viable option for charitable donations and for funding credit union development initiatives," says Bruce Wheeler, Director of Donor & Public Relations. "Representatives of state foundations, leagues and corporate credit unions - as well as U.S. Central - recognize the need to change and fully participated in the process that resulted in these new formulas."

    U.S. Central has agreed to waive all requirements/penalties/fees for credit unions moving funds from the current 90-day account into any of the other, more attractive options.

    CIF is a three-way partnership between the National Credit Union Foundation, the Association of Corporate Credit Unions and the American Association of Credit Union Leagues. It is the U.S. credit union movement's primary mechanism for funding credit union development at the local, state, national and international levels. Currently, more than 320 credit unions, one state credit union foundation and one state credit union league are invested in CIF, which stands at over $44 million.

    For additional information on the changes, contact Kris Hoffman at 1.800.356.9655 x4397. For investment information, contact your corporate credit unions.

    An Interview with Outgoing Executive Director, Pat Brownell-Sterner

    The Flame recently sat down with outgoing executive director, Pat Brownell, to discuss her history and experiences with the National Credit Union Foundation. As she moves on to other challenges and opportunities, the Board and the staff of the National Credit Union wish her the best of luck and much happiness.

    The Flame: You've been with the National Credit Union Foundation since 1992. When you arrived, what was the Foundation like? What was the organization you inherited?

    Pat Brownell: The Foundation was a fairly traditional trade association foundation. In fact, it's name was the CUNA Foundation. It really focused on education and scholarships in support of trade association activities. But I also found an organization that was poised for a lot of growth. CUNA recognized that, which is why they brought me on.

    TF: At that time, what was the structure?

    PB: The Foundation Board was made up of CUNA Board members, five people essentially appointed by the CUNA Chair.

    TF: And staff?

    PB: When I came on board they went from a half time director and a third time assistant to one full time executive director and one full time assistant.

    TF: And flashing forward nine years, the Foundation you're leaving behind...

    PB:, structurally, a totally different organization. The Board is 13 voting members, elected by the Foundation Board, representing different sectors of the movement, plus the immediate past chair and the president of CUNA - who also serves as the president of the Foundation. So it's really 15 active board members that govern the Foundation. And the staff is six and a half people; three in Washington D.C. and three and a half in Madison.

    TF: If you would describe NCUF in 1992 as having been an association-focused organization, how would you describe the Foundation in 2001?

    PB: As a nationally focused charitable foundation with a specific and solid mission to promote consumer financial independence through credit unions.

    TF: How has the Foundation gotten to where it is today? What's happened that's enabled that change to be accomplished?

    PB: I would say, fundamentally, the huge support from CUNA and its affiliates to support the Foundation's work, that initial support from CUNA and the willingness to capitalize or underwrite the positions necessary to begin the growth and change. Secondly, I attribute our growth to the leadership of a dedicated Board throughout all the changes over the last nine years.

    TF: CUNA hasn't been the Foundation's only partner. How have partnerships helped break new ground over the years?

    PB: I think getting close to $1 million from the Ford Foundation to underwrite three specific Foundation programs to build member wealth helped us solidify our mission and put our focus toward the work of consumer financial independence. I'd say that was very significant. I think our work in affordable mortgage lending has been groundbreaking and will continue to be groundbreaking as we move down the road, in particular working with Fannie Mae. I also think the work in the Community Investment Fund, which is a broad partnership involving organizations at both the national and state levels, is groundbreaking. CIF is a major fundraising tool but also provides the mechanism for states to do more development related activities. Yes, I'd definitely call that one groundbreaking.

    TF: Not to mention incredibly exciting.

    PB: Oh, it's amazing! When we first started CIF, even our supporters said 'this is really great but I don't think you'll get more than $5 million.' But to have, three years later, $45 million and investors sticking with us through a difficult economic time is really gratifying.

    TF: What are some of the moments that have touched you most?

    PB: That's a big one...

    TF: Yes, it is.

    PB: I have to think about that ... One would be when Dennis Cutter stepped down as Chairman after 14 years of providing incredible leadership to an organization that was pretty much under the radar screen; he really helped bring us above that. And I think the transition of Dennis from Chair to Immediate Past Chair and Alan Peppers coming in as new Chair was a significant moment that, to me, showed the commitment of the Board not to their egos but to the mission of the Foundation.

    TF: What else?

    PB: Certainly, the Oklahoma disaster was a turning point, not only for the Foundation but for me, because it happened early on in my career here and was an overwhelming show of how this movement works together.

    TF: It's amazing, isn't it?

    PB: It really is. There isn't any other like it. So that was a defining moment. For credit unions as well as for me. I think another moment for me was when the State Credit Union Foundations Network finally came together. That was a major initiative coming in the door, so it's' very gratifying to see a strengthening network at the state level focused on development and credit union issues.

    TF: Any others?

    PB: I would say going through Development Education training was a wonderful time. Being part of the DE network has been - and will continue to be as far as I'm concerned - a major source of support and an incredibly exciting network.

    TF: Before we conclude, can you give a few then and now statistics?

    PB: When I came on board the endowment fund was about $1 million and now it's $1.7 million. Funds coming in was about $250,000 per year.

    TF: And today?

    PB: Funds coming in today, we're a little over $2 million.

    TF: Funds going out?

    PB: Back then, probably under $150,000 per year. Maybe more like $100,000. And this year we put out $1.2 million. A sidenote on that is that, when I came on board, one of the things we had to get through was that you can't be a successful foundation either in fundraising or grantmaking unless you actually spend money. So I think that taking some risks and spending some of the money that was piling up in reserves was a hard thing for the Board to do. But ultimately it created a more stable inflow of cash since we were able to demonstrate what it is we were - and are - doing.

    TF: And the future of the Foundation? You won't be here to guide...

    PB: But I'll be watching...

    TF: What do think you'll see?

    PB: Oh, the future's incredibly bright! I think the Board has selected an outstanding leader in Gary Officer; he'll really work to get the Foundation through its next phase of growth. Also, the current staff has been hand-selected and will provide the means, along with Gary, for the Foundation to grow rapidly in the future. In fact, I will not be surprised at all two or three years from now to see the Foundation bringing in $5 million or more per year and being recognized as one of the more innovative organizations for community development. I think the National Credit Union Foundation will continue to build on its success and prove that credit unions are one of the best - if not the best - tools to build and stabilize communities. And when I say credit unions, I mean all credit unions.

    TF: As those future successes happen, I think it's safe to say your stamp will be evident, and we thank you for that.

    PB: I really appreciate that. As I said, work should be about making a difference and I hope I've been able to do that.

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