Standing Committee Communication
Posted Thursday, May 01, 2008
WAPITI – A summary of key events and decisions since 2003
In January, 2003, The Conservation Fund (the Fund) a Washington D.C.-based non-profit organization dedicated to the conservation of large tracts of land, joined in partnership with the Diocese to acquire Wapiti Farm, a 616 acre tract with a mile of waterfront on the Elk River, a tributary of the Chesapeake. The Diocese contributed $3 million to that property acquisition by the Fund. The agreement between the Fund and the Diocese contemplated that the Fund would be bought out, and its investment recovered, with funding from various government programs.
Between 2003 and the summer of 2007, the Fund and the state of Maryland seemed to be in agreement on a plan pursuant to which the State would buy 183 acres adjacent to Elk Neck State Park and purchase a conservation easement on the remaining 433 acres at a price based on land assessments. The combined State contribution for the 183 acres and the conservation purchase on the 433 acres would fund the buy-out of the Conservation Fund’s interest, thereby giving the diocese the remaining 433 acres. The Diocese would then have the right to develop the 433 acres subject to severe building restrictions imposed by the terms of the easement.
While the Fund was negotiating with Maryland, pursuant to a lease from the Fund (for a total rent of $1.00) the Diocese constructed six structures and a platform tent village, established a board to oversee operations, developed an annual scholarship drive, created a year-round retreat ministry, and managed the transition of a one-week summer youth camping program in rented facilities to a summer-long diocesan camp at Wapiti for young people of all races and backgrounds from the Philadelphia area.
On August 10, 2007, the State of Maryland informed the Conservation Fund that the State was withdrawing from the Wapiti project and would not provide any money to purchase the 183 acres or a conservation easement on the remaining land. The Conservation Fund advised the diocese that it had no other source of public funding. As a result, the Conservation Fund asked the diocese to pay it for the $4.3M it had invested in the project and take title to all 616 acres. After a series of negotiations, on October 12, 2007, the Conservation Fund agreed to sell the Diocese 433 acres of the 616 acre Wapiti Property for $2.7 million funded through a commercial loan.
On November 3, 2007, the 224th Diocesan Convention authorized the acquisition of the land at Wapiti for $2.7 million. At the closing, the Diocese borrowed $2.8milion ($2.7 million for the acquisition and $100,000 for closing costs). Title to the property was taken in a newly formed corporation known as Wapiti Land Company, a subsidiary of the Church Foundation, which guaranteed the repayment of the loan. Peter Wilmerding, Chair of Finance and Property, is the president and sole director of Wapiti Land Company. No payment or interest is due on the note for two years. At the end of the two year period the Diocese will owe $3.2 million.
As negotiations with the Conservation Fund were taking place, Finance and Property was aware that there was no money in the proposed Program Budget for 2008 (to be presented and adopted at the 2007 Diocesan Convention) to cover the cost of ownership of the Wapiti Property (caretaker salary, taxes, maintenance, etc.). It was estimated that those costs could run as high as $150,000. The Program Budget did include a line item of $146,000, for camping. At a meeting at the end of October 2007 the lack of funding of the ownership expenses was raised. Notwithstanding the Presentment and his imminent inhibition, Bishop Bennison pledged $150,000 of his personal funds to cover the cost of ownership. Apparently relying upon Bishop Bennison’s pledge, no mention of the maintenance cost shortfall was made to Diocesan Convention by Finance and Property or the Wapiti Board as the acquisition was authorized. Unfortunately, Bishop Bennison has not honored his pledge.
At the meeting of Diocesan Council in January, 2008, the subject of camp at Wapiti was extensively discussed. The issue was whether there would be a camp in 2008 and the costs associated with having the camp. Again, no mention of the ownership shortfall was made to Diocesan Council, Finance and Property apparently still relying upon the pledge from Bishop Bennison. At that meeting, Diocesan Council advised the Wapiti Board that in order for there to be a camp in 2008, the Wapiti Board had to present a business plan to Diocesan Council at its March meeting. At the time of the January meeting, the Wapiti Board had not yet hired a Camp Director.
Sometime following the January meeting of Diocesan Council, the Wapiti Board named the Rev. John Williams to act as Camp Director, and directed him to prepare an operating plan and budget for the camp, which he presented at the March meeting of Diocesan Council. The budget and plan presented only addressed the costs of running the camp, and did not include any reference to the cost of ownership or maintenance. At that meeting, Diocesan Council was informed for the first time about this unfunded expense, which became the principal subject of the discussion. A week before that meeting of Diocesan Council, Finance and Property had made a request to the Standing Committee to fund the cost or ownership and maintenance. The Standing Committee responded by inquiring as to the status of Bishop Bennison’s pledge, and adopted a Resolution urging Finance and Property and the Wapiti Board to contact Bishop Bennison.
Because of the uncertainty of receiving the funds pledged by Bishop Bennison and having no other funds available to cover the cost of ownership and maintenance, other than the line item for camping in the Program Budget, Diocesan Council adopted a Resolution which provided that unless funds could be obtained or guaranteed prior to April 15, 2008, there would be no camp and all operations would cease.
The April 15, 2008 deadline passed, apparently without a response from Bishop Bennison, and without any alternate source of funding having been found. Nevertheless, the Wapiti Board and its camp director continued their efforts to plan for the camp for 2008.
A meeting of Finance and Property took place on April 16, 2008 and the matter was again discussed. The Rev. John Williams and representatives of the Wapiti Board were in attendance, as were the Chancellor and two members of the Standing Committee. The purpose of the discussion at Finance and Property was to seek alternate funding for the cost of operation and maintenance of the property so that the camping program could proceed. At the conclusion of that discussion, Finance and Property adopted a Resolution asking the Standing Committee to provide the necessary funding.
The Standing Committee met on April 22, 2008, and discussed the funding request and the camp proposal. Alternate sources of funding were discussed, including the rent being received for the use of a portion of the property, possible fund raising by the Wapiti Board, scholarships, and camper fees, to make up at least a portion of the shortfall. At the end of that discussion, with a recognition that the Standing Committee has a fiduciary responsibility to the Diocese with respect to the limited funds at its disposal; that the summer camping experience is part of the educational program of the diocese; and that the children of the diocese should not be denied the opportunity to participate in such a camping program due to the funding crisis, the Standing Committee adopted a resolution which provided as follows:
1. In order to encourage contributions to meet the shortfall, the Standing Committee will match, on a 1 for 2 basis, all outside contributions for summer camp at Wapiti this year up to $50,000 ( $1.00 for every $2.00 contributed) if the camp is held.
2. If insufficient funds are raised to operate the camp at Wapiti this year, the Standing Committee will offer up to $400. Scholarship per camp, not to exceed a total of $50,000, for attendance at any other near Episcopal diocesan camp if the child is recommended by the appropriate vicar or rector.