MADISON, Wis. – Some consider them the epitome of credit unions' `people helping people' philosophy. Credit union foundations have been responsible over the years for donating thousands of dollars towards domestic and international charitable, grantmaking and educational initiatives. Now in the wake of September 11′s terrorist attacks, credit union foundations have once again risen to the occasion and become the conduits of disaster relief donations to the survivors of the catastrophe. As of September 28, the New York Credit Union Foundation had received almost $332,000 in donations for its Disaster Relief Fund from state leagues and individual credit unions. The money will be used to help the most severely affected credit unions in Manhattan restore service to their members, and to aid credit union staff and volunteers, as well as CU members and the general public. The "Credit Unions Rebuild America" fund created by CUNA and the National Credit Union Foundation to funnel relief effort donations to all communities affected by the terrorist attacks collected nearly $120,000 in its first week. The New York Credit Union Foundation is one of 25 state CU foundations representing 29 states – some foundations such as the New England Credit Union Heritage Foundation are supported by more than one league. The New England Credit Union Heritage Foundation, for example, belongs to the Massachusetts, New Hampshire and Rhode Island Credit Union Leagues. On the West coast, the Richard Myles Johnson Foundation which until October 1999 was known as the Filene Education Foundation, was established by the California and Nevada leagues Just last month, the North Carolina Credit Union Foundation announced its partnership with the credit unions of South Carolina. The new foundation has been named the Carolinas Credit Union Foundation. "The state credit union foundation system is constantly evolving," said NCUF's Director of Donor and Public Relations Bruce Wheeler. Educational initiatives, especially providing scholarships, continue to be the cornerstone of most credit union foundations. An increasing number of foundations though have broadened their scope to include providing assistance to small credit unions, community development, financial education to consumers, and of course, disaster relief. The Florida Credit Union Foundation, for example, was established in 1981 and is an education-only foundation. It is currently in the process of re-writing its bylaws Writing or amending a foundation's bylaws is always a crucial process when establishing a foundation, Wheeler explained. Since foundations are chartered at the state level, leagues have to go through their regional Internal Revenue Office. Foundations are chartered as 501C3′s, the IRS' code for non-profit charitable foundation. "It's important that the foundation not be seen by the IRS as being a trade association, which are not-for-profit," Wheeler said. "State leagues cannot channel money into a state foundation for activities that a trade association typically engages in. Each one has activities that are permissible." Determining how monies collected are distributed depends on the foundation and how its bylaws are set up. The foundation's charter essentially acts as a roadmap, explained Wheeler. If the foundation wants to do something that's off the roadmap, it has to get the approval of its board. "It's not up to a league to decide how any money collected by the foundation should be distributed, that's up to the foundation's board" said Wheeler. With the Credit Unions Rebuild America fund, for example, Wheeler said NCUF let CUNA's executive team decide how monies collected should be allocated "because we were doing this on CUNA's behalf," Seventy-five percent of the donations are going to the Red Cross; the remaining 25% is going to the United Way's September 11th Fund. In practice league staff often winds up staffing the state foundation, "But a foundation in order to maintain its tax exempt status, needs to have its own autonomous board of directors," said Wheeler. When a league board member does serve on a foundation board, Wheeler suggested they should not serve in the same decision-making capacity. The NCUF, under Executive Director Pat Brownell, set a model for this by expanding its board from being the CUNA Foundation with a board of five CUNA directors, to the National Credit Union Foundation, with a 13-member board representing specific constituent groups, including credit unions, CUNA, U.S. Central, corporate credit unions, system affiliates and the State Credit Union Foundations Network. CUNA directors are still on the NCUF Board, said Wheeler, but the foundation by increasing the size of its board, has expanded its decision-making base. – [email protected]