Archive for Friday, September 19, 2003

Kauffman leader defends foundation

September 19, 2003


— The leader of Kansas City's largest philanthropic foundation said Thursday that he was confident the organization would prevail amid a firestorm of controversy.

Carl Schramm, president and CEO of the Ewing Marion Kauffman Foundation, said concerns that led to an investigation of his organization by the Missouri Attorney General's Office were unfounded.

"They are concerns without any factual basis and without even a scintilla of discussion on the part of anyone in management or on the board," Schramm said.

Schramm, who has the post since April 2002, was the featured speaker at Baker University's annual convocation.

Missouri Atty. Gen. Jay Nixon earlier this month announced he would launch a civil investigation into the management of the foundation, which distributes tens of millions of dollars each year to organizations focusing on youth development and entrepreneurship.

Nixon said he would look at possible conflicts of interest, the board of directors' management and whether the foundation's spending is consistent with its mission.

Five foundation board members have resigned in the past year. Several have complained that Schramm has spent too much on outside consultants and employee buyouts in his time in the job. They also complained the foundation was spending too much on national organizations, shifting away its local focus.

But Schramm said the organization, which has an asset base of about $1.7 billion, hadn't changed its mission.

"They're the same focuses we've had in the past -- youth development and entrepreneurship," he said. "We're not becoming a foundation committed to global peace or to agricultural reform in Central America. There's no seismic change in our agenda."

According to Kauffman records, Lawrence organizations will receive more than $15,000 in grants from the foundation this year and share portions of another $1.1 million in grants.

The largest beneficiary in recent years has been Kansas University's school of business, which uses Kauffman grants for its entrepreneurship program.

"We consider (the foundation) to be a good friend of the school," said Bill Fuerst, dean of the business school.

Fuerst said he was concerned that if the Kauffman Foundation shifted to a more national focus, KU could be left out of future grants. This year, the foundation solicited proposals from 30 business schools to receive a handful of multimillion-dollar grants to improve their entrepreneurship grants. KU didn't receive an invitation.

"I think some of the Kansas City people are concerned that it's lost a little of its orientation in helping out in the greater Kansas City area," Fuerst said.

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