Buffalo Business First Article
By Tracy Drury, Buffalo Business First
Western New York charities will likely breathe a collective sigh of relief with today’s news: The First Niagara Foundation will continue for at least the next eight to 10 years, despite the acquisition of its commercial banking operation into KeyCorp.
The $36 million foundation announced today it will continue its philanthropic legacy as an independent foundation, bolstered by a $20 million commitment from KeyCorp., which completed the First Niagara Bank deal earlier this year. There was some worry early on about how giving would be impacted.
Elizabeth Gurney will continue on as executive director from offices that will remain in downtown Buffalo at the Larkin Building, leading a plan to spend down the foundation’s assets over time.
“We’re going to be very thoughtful about our spending and very careful with our resources because while it seems like a lot of money today, there’s a lot of need in our community,” she said. “We don’t want to just throw it out there and hope it sticks.”
Founded in 1998 under the former Lockport Savings Bank, First Niagara Foundation has ranked among the top private foundations in the region, with annual gifts and grants of $5 million to $6 million in each of the past three years. Giving spiked in 2012, when the company paid out $12 million in grants after its acquisition of HSBC Bank’s branch network.
A total of $4.5 million will be paid in 2016, with commitments of $5.5 million. That includes year-end gifts announced today: $1 million to the Albright-Knox Art Gallery to support its AK360 expansion project; $125,000 to the Lockport Family YMCA to build a new facility; $35,000 to the Hispanic Heritage Council of Western New York Inc. in support of its Niagara Street Corridor renovation project; and $15,000 to Peace of the City Ministries to assist with building infrastructure and capacity.
Until now, giving by the foundation was based on the total provided by the bank to fund the foundation. That’s different from typical independent private foundations, which give away 5 percent of total assets based on a multi-year average. Local foundations with $34 million-$36 million in assets gave $1.5 million-$2 million last year.
Choosing the spend-down model provides more flexibility, and a bit more pressure, she said. First Niagara Foundation is the second organization with local ties employing the model: The Ralph C. Wilson Jr. Foundation has a mandate to give away more than $1 billion over 20 years.
Gurney will have plenty of help figuring out how to give it away: Overseeing the foundation will be a seven-member board of directors, including Gary Crosby, former president/CEO at First Niagara Bank and now KeyCorp director. Others board members include bank officials Trina Evans; Gary Quenneville; Buford Sears; and Ann Segarra. They are joined by David Zebro, a principal with Strategic Investments & Holdings Inc. and Leslie Zemsky, a partner with Larkin Development Group.
“It’ll take a few months to ramp up and make sure we’re making really good investments,” Gurney said. “It’s a responsibility and a privilege to give away money to support the community. We have to make sure the organizations we’re investing in have the capability and capacity to be good stewards of the money.”
Crosby said the majority of board members are longtime Western New York residents and leaders in local business, civic affairs and philanthropy who understand the community’s needs.
“We’ve assembled a board whose passion and experience will help the Foundation strengthen its reputation for impactful charitable giving, collaborative partnerships, diversity and inclusion,” he said. “Commitment to philanthropy was a long-standing and deeply-rooted part of First Niagara’s culture. It’s also a core value of KeyCorp, whose $20 million contribution ensures that the Foundation can continue its mission to invest, even more substantially, in education, workforce development, mentoring and community development making Western New York an even better place.”
Other foundation leaders are encouraged to see the foundation remain, and will do what they can to support the transition.
“With the good work that they’ve done, knowing it will continue is important to the community,” said Amber Slichta, an executive with Wilson Foundation and board chairwoman for the NY Funders Alliance, an association of grantmakers and philanthropic advisors throughout the state. “Over time I’m sure we’ll discover what philanthopic work may change at KeyBank given the merger and their different position in the community.”
A new round of grantmaking to begin in January 2017. Applications will be accepted online.
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