Pennsylvania Credit Union Association

Reports

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2011 Chairman's Report

Ray Brunner, Chairman

In 2011, the Foundation helped raise $266,404 in total funds, an increase of
2 percent over 2010. Unrestricted revenues, or those directly raised and managed by the Board of Directors realized $216,404, a decrease of 6.6 percent from the $231,583 raised in 2010. Despite the decrease, several factors were at play in 2011 that reflected both increases and decreases in institutionalized fundraising including:
  • The Pennsylvania Credit Union ¬Association (PCUA) and Pacul Services, Inc., contributed $50,000 in restricted funds to the National Credit Union Foundation (NCUF) for flood relief at the urging of the Foundation, instead of its annual $10,000 contribution in unrestricted funds that would have reduced the deficit for the year to 2.2 percent.
  • Credit union support actually increased in 2011 by 5.4 percent to $104,300 in direct contributions, and 13.4 percent to $38,000 in special events support compared to 2010;
  • Corporations, vendors and business partner direct contributions, fell by 17 percent to $37,625, a reflection of the continued downturn in the economy during 2011.
  • The Viva Las Vegas Fall Leadership special event increased revenues by 16.7 percent to $44,816.
  • Community Investment Fund proceeds dropped by more than 49 percent to $11,679, a reflection of low interest rate environment and the corporate crisis. Fortunately, several new Community Investment Fund opportunities are in the process of being developed by the National Credit Union Foundation (NCUF), which will provide additional alternatives for 2012.
I am grateful to all of our Board members for their fundraising efforts. Of particular note are those who achieved goals in credit union fundraising—Vice Chairman Dave Ackerman, USX Federal Credit Union; George Nahodil, Members 1st Federal Credit Union; Secretary Chris Woods, Keystone Federal Credit Union; Barb Bowker, Pennsylvania State Employees Credit Union; Ed Williams, Discovery Federal Credit Union; and Treasurer Jeff DeBree, Penn East Federal Credit Union.

Vendor campaign goals were surpassed by Dave Ackerman, George Nahodil, Barb Bowker and Rick Stipa, TruMark Financial Credit Union. The entire Board recognizes the relationship between their ability to fundraise and their empowerment to approve and evaluate grants as a reflection of the Foundation’s stewardship to its donors.

GRANTS
The Foundation evaluated and supported 280 grants in 2011 valued at $321,158 compared to 28 for $126,530 in 2010. The Foundation actually awarded $226,158 of its own funds, while it generated $95,000 in support from the PCUA and the NCUF, for the Pennsylvania Flood Relief program. The Foundation awarded 42 unrestricted grants for $126,358 in 2011. While grant value was virtually identical to 2010 results, the number of grants increased by 50%, thanks, in part, to the 13 PCUA Webinar Education projects that provided training assistance to small credit unions. Financial literacy project approvals remained constant at 12, though their value decreased by 7 percent to $82,259. Small credit union projects increased 86 percent to 26 grants and by 4.3 percent to $37,099.

FINANCIAL LITERACY
Since its inception eight years ago, the financial literacy program has been implemented in 193 of Pennsylvania’s 500 school districts. Financial education courses are taught in 291 high schools, 85 elementary schools and 145 social and community centers. The program has provided 4,801 person hours of teaching and nearly 2.6 million hours of learning to more than 108,608 students. Nearly 81,500 books have been purchased and used by students, up by 3,650 from 2010.

In addition, two new classroom education projects were implemented and awarded at Milton Hershey School. Four additional student branches opened at Titusville High School in Crawford County, Big Spring High School and Cedar Cliff High School in Cumberland County, and Wyoming Valley West High School in Luzerne County. Pennsylvania has 43 student branches. Five community outreach programs were also implemented during the Foundation’s 15th year of operations.

The debut of several new and exciting financial literacy projects occurred in 2011. A Reality Fair pilot project at the Harrisburg Capitol provided nearly 200 high school students a unique opportunity to learn to manage their finances through real life scenarios. Moreover, an important Foundation program was introduced to legislators as part of the PCUA’s political advocacy effort that visibly demonstrates the participation of credit unions in the community at large.

An intriguing interactive program, Moneyville, was exhibited at the Reading Public Museum from October through December 2011 and resulted in nearly 10,000 visitors and an increased awareness of credit union community endeavors in the Berks County area.

All told, nearly 20,000 more participants benefited from community-based programs in 2011. Education in the workplace also increased in 2011. Two thousand two hundred member groups received 320 hours of counseling in investment, housing and health matters that affect the daily lives of virtually all credit union members.

RESEARCH
The Foundation has also embarked on two challenging multi-year projects that, if realized, will place the PCUA and the Foundation on the cutting edge of accomplishment. The first is an evaluation of the Credit Union Better Choice program that seeks to measure the changing behavioral patterns that may result from the transition of a payday borrower to a traditional institutional borrower.

The study seeks to determine if Better Choice payday borrowers have increased savings and greater debt-free purchasing power by joining a credit union and are able to borrow funds without the onerous interest charged by payday lenders. If the results are positive, then unlike other financial institutions, credit unions will have developed a means to attract millions of underserved members into the movement.

HAITIAN TASK FORCE
The second project is the continuing work of the Haitian Task Force. It is hoped that in 2012, the Task Force will secure grant funding to improve credit union capacity in rural Haiti, as well as support the work of the WOCCU Service Corporation in introducing a viable credit union generated remittance system.
Before a grant request can be submitted, however, the Task Force must succeed in leveraging funds from credit unions to support travel to Haiti for project development and monitoring and to agree to provide management, operational and financial training to Haitians here in Pennsylvania. The aforementioned strategy, developed by the Task Force during its trip to Haiti in 2010, is supported by the Haitian Government and new President, Michele Martelly. We are hopeful that significant progress will be made in 2012.

DISASTER RELIEF
On September 7, 2011, Tropical Storm Lee hit the entire Susquehanna Valley River Basin with a vengeance, destroying thousands of homes and leaving many credit union employees and members without shelter. The Foundation managed to stay ahead of the crisis in ways that are described in the Executive Director’s Report. Suffice to say that as a result, the credit union movement has received wide acclaim for the work performed on behalf of credit union employees and members. I am pleased to praise both the Association and Foundation Boards for their speedy, seamless decisions to support the recovery effort. Certainly, it is no accident the Director of the Pennsylvania Emergency Management Agency, Glenn Cannon, will be the featured speaker at the Foundation’s 17th Annual Foundation Breakfast.

2012 GOALS
Some Foundation priorities in 2012 have already been discussed, but I will, once again, summarize them and add others:
  • It is important that the Better Choice research project be completed by 2012, and its results communicated to the general public particularly if they show a positive impact on the underserved.
  • The Haitian Task Force must be in the process of implementing a strategy for Haiti supported by Pennsylvania’s credit unions.
  • Increase our unrestricted funds raised to $231,000 and our unrestricted grants to $130,000, particularly in the financial literacy and small credit union development sectors.
  • Replicate the success realized by the first Reality Fair by introducing a minimum of four new Fairs in 2012 and by leveraging $20,000 in miscellaneous revenues from participating credit unions in support of those Fairs. In return, Foundation must provide leadership and managerial expertise that enhance a credit unions’ capacity to deliver financial education to students through the Fairs.
  • Be prepared to cope with any unexpected disasters that may occur in Pennsylvania as effectively as we did in 2011. And finally, we must continue to consult with credit unions who apply for NCUF Innovative Technology Project Grants, Dora Maxwell Awards, or Desjardins Awards as requested.
This report would not be complete without thanking Foundation ex-officio member Michael Kaczenski, Association Chairman, and ex-officio member, Jim McCormack, Association President/CEO, for their guidance and support. Michael’s personal support and the support of Sun East Federal Credit Union have been generous and unwavering throughout the years. Jim’s personal support and his vision as evidenced by an uncanny feel for an appropriate and quick response during times of emergency was again borne out during the Pennsylvania floods in September 2011.

I continue to look forward to the support, dedication, energy and passion of staff members Michael Wishnow, Joseph Wambach and Denise Maneval in 2012 that continue to benefit the credit union movement in Pennsylvania and elsewhere. And finally, my thanks to you, our generous donors; whom I hope will be even more generous in your support of the Foundation in 2012.

2011 Executive Director’s Report

Joseph Wambach, Executive Director

During its 15th year of operations, the Pennsylvania Credit Union Foundation experienced a mixed year of fundraising because of a continuing sluggish economy on the one hand and a serious natural disaster on the other. The result was a decline in unrestricted revenues raised, but an increase in restricted revenues used. Revenue raised actually decreased 6.6 percent to $216,404 in 2011; however, restricted revenues used increased by 19.2 percent to $311,404 in 2011.

A severe flood caused by Tropical Storm Lee that occurred in September 2011, resulted in an additional $95,000 received for grants by the Foundation from the Pennsylvania Credit Union Association (PCUA), Pacul Services, Inc. and the National Credit Union Foundation (NCUF). Though the funds did not pass through the Foundation’s books, they constituted a portion of the 238 grants that were evaluated and approved by the Executive Director (more information follows below).

On the plus side, the Foundation, in essence, received $50,000 from the PCUA or a 400 percent increase in support, $104,300 or a 5.4 percent increase from credit unions and $44,816 or a 16.7 percent increase from the Viva Las Vegas special event. In addition, the Foundation board raised $139,231 for other sources or a 1.2 percent decrease.

The Foundation received $37,625 or a 17 percent decrease from vendors and corporate business partners; $6,949 or an 8.7 percent decrease from PCUA employees (caused by reduction of staff) and $11,679 or a 49 percent decrease from the Community Investment Fund (CIF)—caused by the continuing corporate crisis and a significant decrease in interest rates that made credit union investment less -appealing. 

GRANTS
In the grants sector, the Foundation intervened in a series of unique projects, many not directly financed through the Foundation, but which were developed and managed by Foundation staff and contributed to the Foundation’s appeal and ultimate fundraising success (to be discussed below). The regular grants sector did show a 50 percent increase in the total number approved and awarded from 28 to 42. Since 18 of the grants were less than $1,000, however, the actual value awarded in 2011 - $126,358 remained virtually equal to the $126,530 awarded in 2010.

FINANCIAL LITERACY
Financial Literacy grants continued to be implemented at the community level. Housing Opportunities of Beaver County, (HOBC), a project partner of WEST-AIRCOMM Federal Credit Union, received a fourth and final grant of $3,970 to continue to assist first time home buyers and victims of foreclosure. According to Foundation Chairman Ray Brunner, the Foundation’s intervention during the last four years was a major factor in keeping HOBC afloat and now the organization is beginning to receive additional support from the Federal Government.

The Foundation also continued to support the Young Men’s Futures Symposiums and the Young Women’s Futures Symposiums through a continuing $10,000 grant to Junior Achievement of Central Pennsylvania. The grant provided not only life skills and financial literacy to 500 high school sophomores and juniors in six Pennsylvania counties, but also an opportunity for PCUA staff and credit unions to actively participate in the program as volunteers. During all symposiums, credit unions provided their own financial support and led a variety of interesting life skills and budgetary sessions that proved to be well received by the students.
Four additional grants valued at $37,187 helped open student branches at Titusville High School (MEADVILLE AREA Federal Credit Union), Wyoming Valley West High School (Wyoming Valley West Community Federal Credit Union), Big Spring High School (Cornerstone Federal Credit Union) and Cedar Cliff High School (AmeriChoice Federal Credit Union), bringing the total number of Pennsylvania student branches operating to 43.

Classroom education reporting continued to be steady and two new projects valued at $15,000 were introduced—an ambitious project by Erie Federal Credit Union to assist the Erie School District’s CHAMPS Program for the benefit of underserved children in an after school program and Members 1st Federal Credit Union’s Financial Challenge program at Milton Hershey School that also benefits students involved in an after school education program.

Finally, two other important financial education programs valued at $13,000 were supported. The first was the NYIB Conference held in Pittsburgh in July 2011 which provided more than 200 future credit union leaders with a glimpse of various philanthropic activities being undertaken by the PCUA and the Foundation in financial literacy. The second, the Moneyville Program, provided an interactive financial literacy program to more than 10,000 students at all levels in Reading, PA. The final program of note was the Reality Fair program, implemented by the Foundation on November 17, 2011, at the Capitol Rotunda.

The pilot Reality Fair provided life skills scenarios that assisted students in developing good financial management habits like monthly living and budgetary plans. Each student was asked to indicate a career he/she wished to pursue, a salary was provided to each and monthly purchase scenarios of fixed and variable costs were introduced. The goal was to match monthly salary to monthly budget in order to remain debt free.

A Reality Wheel was introduced to provide unexpected emergency situations in life that could change even the best prepared budget plan. Finally, students were permitted to talk with financial counselors—all PCUA and credit union volunteers—to discuss choices and to prepare a final, realistic monthly budget designed to fit the student’s occupation and lifestyle. The pilot Fair proved so successful that the Foundation intends to implement a minimum of four additional Reality Fairs in 2012. Moreover, the financial support of the credit unions involved—each contributed $1,000 for a total of $8,000 along with a Foundation grant of $6,200—helped leverage support for the project.

SMALL CREDIT UNION PROJECTS
Twenty-two small credit union projects were implemented in 2011—one strategic planning project for $2,250; 13 webinar development projects for $9,738; 4 marketing projects for $10,724; 3 technology projects for $8,137; 1 debit card development project for $3,000 and four scholarships programs for $3,250. The Foundation will continue to work closely with SCUNet, a PCUA-based program that assists small credit unions in to use their resources to grow, since many underserved members belong to small neighborhood and church-based credit unions.

COLLABORATIONS
The Foundation continued to be involved in a number of initiatives stemming from its technical expertise by providing assistance to the National Credit Union Foundation (NCUF) and to the Association. Phase II of the Association’s Investor Education in the Workplace program continued to provide investment training to nearly 1,500 staff at 28 additional credit unions. John Kebles, retired CEO at Choice One Community Federal Credit Union, Wilkes-Barre, continued to provide expertise to the Investor Education program, the Reality Fair program and in other REAL Solutions programs for 130 REAL Solutions credit unions.

As discussed in the Chairman’s Report, a REAL Solutions project of $23,000 awarded in 2010 by the NCUF and the Foundation continues to provide data about savings and the manner in which borrowers use funds received through Credit Union Better Choice loans. If successful, the final report will be a landmark and the first of its kind to define behavioral results of former payday borrowers who have joined credit unions.

Finally, the Haiti Task Force showed only limited results in 2011; however, that is expected to change in 2012 with the completion of a project proposal to the NCUF or the World Council of Foundations, Inc. Once completed and assuming that Pennsylvania credit unions support the Task Force, the project will be ready for implementation towards the end of 2012. Dave Ackerman, Foundation Vice Chairman and CEO, USX Federal Credit Union and Chris Woods, Foundation Secretary and CEO, Keystone Federal Credit Union, are commended for their efforts in providing research and input toward this significant project.

DISASTER AID
The most significant event that affected the Foundation in 2011 was massive floods caused by Tropical Storm Lee which hit Pennsylvania in September and to which the Foundation responded rapidly for the benefit of the movement in the following ways:
  • Within days of the September 7 disaster (September 12), the Foundation contacted 125 credit unions in the Susquehanna River Basin to inform them of its intent to provide small grants for credit union employees and to warn them about an influx of loans that would be requested by employees and members alike.
  • On September 15, the Foundation contacted the NCUF to request that they open CUAid, the disaster relief fundraising and grants arm established in 2006 shortly after the Hurricane Katrina Disaster. The Foundation also decided not to request support from its credit unions but instead to request funds from NCUF’s regular CUAid fund. The PCUA, through a board-approved contribution to NCUF’s CUAid fund and from a significant Foundation board-approved disaster relief grant. Support would eventually reach $195,000 for credit union flood victims.
  • On September 19, PCUA and Foundation officials approved a set of criteria and an application form that would be used during the course of the grants process. The Foundation Executive Director was selected to evaluate each grant request. NCUF was asked to process approved grants by transmitting checks to credit unions for their employees and members.
  • Between September 23 and October 17, the Executive Director reviewed 277 grants, approved 238 and rejected 39. Seventy-seven victims who sustained catastrophic damage received $1,500 each ($115,500), 83 grantees who sustained very serious damage, $650 ($53,950) and 78 who sustained serious damage, $325 ($25,350) for a total of $194,800 in grants.
  • The Foundation provided $100,000 in disaster relief, PCUA, $50,000 and NCUF, $45,000 for a total of $195,000. The $200 surplus was returned to the CUAid Fund. By the end of October, the project’s funding phase was completed.
  • Lastly on December 14, Foundation staff visited West Pittston, one of the hardest hit areas and concluded that while reconstruction of homes had begun, efforts will probably be ongoing for many months. Seventh, visits will be made to other devastated areas, including Tunkhannock, Sayre, Athens and Duryea, PA, to monitor rebuilding activities in 2012. No project of this sort is ever considered successful if only because victims are traumatized for many years after such an event; however, the Foundation’s efforts, leadership and expertise provided a sense of good will, compassion and accomplishment within the credit union movement.
I wish to thank Chairman Ray Brunner, CEO, WEST-AIRCOMM FCU, for his leadership; to all other board members for their fundraising passion and grants expertise; to Association President/CEO and Foundation Ex-Officio member, Jim McCormack, for his confidence, generous support and compassion; to Michael Wishnow, Senior Vice President, Communications & Marketing and Association Foundation Liaison for his advice, encouragement and good humor; and to John Kebles and Denise Maneval for their hard work and support.

Finally, thanks to all of the Foundation’s generous donors and supporters for your continued support. Our vision is an extension of your dreams to share the credit union mission and philosophy with all Pennsylvanians. We will do everything in our power to live up to your expectations in 2012 and beyond.

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For more information about the Foundation, call or e-mail Joseph Wambach, Executive Director at 800-932-0661, ext. 5244, or write:

Pennsylvania Credit Union Foundation
4309 North Front Street
Harrisburg, PA  17110

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