Major Donor Pulls Funding, Leaves ACLU and Locals Scrambling
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The ACLU released a statement today where Gelbaum explains, "For a number of years, your organization has received very substantial charitable contributions from me. My investments in alternative, clean energy companies have placed me in a highly illiquid position as a result of the general credit crisis in the American and world financial systems."
His previous contributions represented one quarter of what the ACLU received annually from donors, according to the Associated Press. But his Newport Beach-based, environmentally friendly investment firm Quercus Trust was down almost 57 percent over the 18 months to late November, according to The Wall Street Journal.
Gelbaum revealed he is also halting some $12 million in yearly gifts to the Sierra Club Foundation and about $50 million annually to the Iraq Afghanistan Deployment Impact Fund, which helps returning service members and veterans.
About 60, the Minnesota native came to Orange County as a teenager, built a fortune at hedge funds, where he pioneered the use of mathematical formulas to help pick stocks and bonds for investors, and has kept a low profile. But he has given plenty to local causes and candidates over the years.
Through the Wildlands Conservancy and the Schwab Fund for Charitable Giving, Gelbaum was a major donor to then-sheriff Mike Carona's now-defunct nonprofit foundation, giving a total of $2.7 million in 2003 and 2004. With Gelbaum as its major donor, the Wildlands Conservancy also gave increasing amounts to the Orange County Board of Education for an outdoors program targeting at-risk youths.
After some eco-activists sought to have the Sierra Club endorse the idea that immigration has aggravated environmental problems, Gelbaum threatened to cut off his donations if the group adopted an anti-immigration stance, he acknowledged in a 2004 Los Angeles Times interview.
He's been a major donor to Democrats, having given Rep. Sanchez (D-Garden Grove) at least $9,000, according to the AP. With rising Vietnamese-American GOP stars aligning to mount a no-doubt bruising 2010 campaign against the Latina superstar, losing any previously counted-on funding must spark concern.
Despite the lost revenue, ACLU Executive Director Anthony D. Romero called Gelbaum "one of America's greatest heroes" and "an unassuming man with a spectacularly generous spirit."
"Every American should be grateful for the selfless commitment to improving the lives of others demonstrated by this remarkable man," Romero says. "While we're clearly disappointed that his desire to remain anonymous was breached, we remain eternally grateful for everything he and his family have done to advance the cause of civil liberties for all Americans."
Romero also expressed hopes others will step forward and replace Gelbaum's donations.
Gelbaum's full statement is below:
STATEMENT BY DAVID GELBAUM FOR USE BY ORGANIZATIONS FACING LARGEST REDUCTIONS IN HIS DONATIONS
December 9, 2009
I understand that you have reached a point in your relations with
your supporters and the general public where it would be important to
reveal my identity as your largest anonymous donor.
The situation is this. For a number of years, your organization has received very substantial charitable contributions from me. I am willing to be publicly named now because my investments in alternative, clean energy companies have placed me in a highly illiquid position as a result of the general credit crisis in the American and world financial systems.
Consequently, and much to my regret, I will not be able to make donations of this size starting in 2010 and continuing indefinitely. Several of the largest organizations I have funded in the last five years have had to make plans to wind down major areas of their work. These are programs I have been proud to support, including the Iraq Afghanistan Deployment Impact Fund that serves the needs of service members and veterans who served in Iraq and Afghanistan, the race and poverty work of the ACLU Foundation, and the Military Families Outdoors program of the Sierra Club Foundation. The future viability of these programs will depend on the generosity of others.
I have consented to disclosure so that my charitable recipients will not be constrained by donor confidentiality, may fully explain how these programs were created and financed, and may ask others to step forward to help sustain them in the future.
The three charities listed below will experience the greatest reductions, compared to what I have given in the past. These are the amounts that I provided to them in the period from 2005 to 2009, through a combination of donor-advised funds, direct giving, and other philanthropic vehicles.
The situation is this. For a number of years, your organization has received very substantial charitable contributions from me. I am willing to be publicly named now because my investments in alternative, clean energy companies have placed me in a highly illiquid position as a result of the general credit crisis in the American and world financial systems.
Consequently, and much to my regret, I will not be able to make donations of this size starting in 2010 and continuing indefinitely. Several of the largest organizations I have funded in the last five years have had to make plans to wind down major areas of their work. These are programs I have been proud to support, including the Iraq Afghanistan Deployment Impact Fund that serves the needs of service members and veterans who served in Iraq and Afghanistan, the race and poverty work of the ACLU Foundation, and the Military Families Outdoors program of the Sierra Club Foundation. The future viability of these programs will depend on the generosity of others.
I have consented to disclosure so that my charitable recipients will not be constrained by donor confidentiality, may fully explain how these programs were created and financed, and may ask others to step forward to help sustain them in the future.
The three charities listed below will experience the greatest reductions, compared to what I have given in the past. These are the amounts that I provided to them in the period from 2005 to 2009, through a combination of donor-advised funds, direct giving, and other philanthropic vehicles.
1. Iraq Afghanistan Deployment Impact Fund at the California Community Foundation
Contact: Amy Fackelmann Gonzalez http://www.calfund.org/learn/iadif.php
$247 million
2. American Civil Liberties Union Foundation
Contact: Anthony Romero http://www.aclu.org/
$ 94 million
3. Sierra Club Foundation
Contact: Peter Martin http://www.sierraclub.org/foundation/
$ 48 million
I request that you make known my support of all three organizations
so that everyone understands that the shift in my financial
circumstances is the cause of the reduction in giving, and not any
disapproval or dissatisfaction with the programs. To the contrary, I
hope they will thrive with the generous support of many other donors,
large and small.
See attached breakdown of programs.
See attached breakdown of programs.
FUNDING AREAS 2005-2009
1. Iraq-Afghanistan Deployment Impact Fund (IADIF)
| IADIF Grants Phase I (2005+) | 112,821,643 |
| IADIF Grants Phase II (2007+) | 40,784,749 |
| IADIF Grants Phase III (2008+) | 92,548,771 |
| IADIF Admin | 489,561 |
| ____________________ | |
| IADIF - TOTAL | $ 246,644,724 |
2. American Civil Liberties Union Foundation
| For Race and Poverty | 13,800,000 |
| For Affiliate Growth | 12,500,000 |
| For Drug Law Enforcement Reform | 10,700,000 |
| For Prisoners' Rights | 7,000,000 |
| For Immigrants' Rights | 6,500,000 |
| For Death Penalty Reform | 5,000,000 |
| For Voting Rights and Felon Re-enfranchisement | 3,700,000 |
| For Women's Rights | 3,500,000 |
| For Voting Rights | 3,400,000 |
| For Scholarships | 500,000 |
| For Youth Programs | 500,000 |
| General Operating Expenses | 26,400,000 |
| ____________________ | |
| American Civil Liberties Union Foundation - TOTAL | 93,500,000 |
3. Sierra Club Foundation
| Military Families Outdoors program | 25,562,000 |
| Hunter Angler Outreach programs | 5,950,000 |
| Building Bridges to the Outdoors | 5,910,402 |
| Environmental Justice and Communities Grassroots Organizing programs | 4,299,700 |
| Water Sentinels program | 2,500,000 |
| Compact Fluorescent Lightbulb programs | 1,103,498 |
| Military Sustainable Housing Fund / Homes For Our Troops | 1,000,000 |
| Climate Recovery Project / Protection and Sustainable Biofuels Campaign | 658,000 |
| Environmental Career Apprenticeship Program | 495,661 |
| National Education project | 110,000 |
| LEED Sustainable Housing Fund | 100,000 |
| ____________________ | |
| Sierra Club Foundation - TOTAL | 47,689,261 |
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