Higher education

University of Iowa Alumni Association faces uncertain future

Its leadership fought a merger with the university's fundraising arm

The Pentacrest, including the Old Capitol, Jessup Hall, Macbride Hall, MacLean Hall, and Schaeffer Hall, in an aerial photograph in Iowa City on Thursday, July 14, 2016. (Stephen Mally/The Gazette)
The Pentacrest, including the Old Capitol, Jessup Hall, Macbride Hall, MacLean Hall, and Schaeffer Hall, in an aerial photograph in Iowa City on Thursday, July 14, 2016. (Stephen Mally/The Gazette)
/

IOWA CITY — The University of Iowa Alumni Association, which marks its 150th anniversary this year and counts tens of thousands of members around the world representing the black and gold, now faces a contentious start to an uncertain future.

Last month, UI President Bruce Harreld announced plans to merge it with the university’s independent fundraising arm, the UI Foundation.

A merger of the “overlapping” organizations will provide “more meaningful alumni engagement and increased philanthropic support,” he announced March 27.

Foundation contributions

Richard Pratt / The Gazette

Within hours, there was pushback — some of it emotional, according to emails obtained by The Gazette through an open records request.

Alumni Association President Jeff Kueter told colleagues he fought against the decision.

“I remain convinced of the benefits to our alumni and the campus of separate, specialized organizations working together when appropriate but capable of distinct approaches when necessary,” he wrote. “I made those arguments in recent days, but I did not sway the president from his conclusion that a unified structure will better serve the dual mission.”

A time frame for the merger aims for a full integration by January 2018 with traditional association membership benefits ending June 30, 2018. But Kueter, who started as association president in 2014, told colleagues he won’t have much say in it.

In an interview last week, he said he had transferred to the UI’s external relations office, where he’s director of corporate engagement working to “create and grow strategic partnerships with industry.”

ARTICLE CONTINUES BELOW ADVERTISEMENT

BIG DIFFERENCES

Both the Alumni Association and UI Foundation are registered nonprofits, but with substantial differences.

The association’s 25 staffers are UI employees but the 233 foundation employees are not.

The association, which reported having 37,383 members last summer, touts its mission as bringing together alumni and students on and off campus through club programming, bowl game events and career networking, for example.

Members historically have paid dues, although Harreld has instructed the association to stop accepting new members and collecting dues, which brought in $1.02 million in the year that ended June 30, 2016.

Tax documents show the association has lost money and members.

In its 2015 report, the association said it lost $85,929 because its expenses were higher than its revenues. Nonetheless, it reported about $7 million in net assets.

Its membership also has dropped — at least from 2012, when it reported 45,992 members.

On the other hand, documents show the UI Foundation netted about $36.4 million after expenses in 2015. It reported net assets of $1.2 billion that year.

A UNIFIED VOICE

In announcing the merger, Harreld touted the notion of “one new, unified organization” that streamlines redundancies and better serves the university and builds stronger relations.

Emails show some people are optimistic.

“Exciting changes ahead for alumni engagement,” Susan Griffith, director of alumni programs for the association, wrote March 28 to UI Foundation President Lynette Marshall.

Other emails reveal shock and dismay over the decision, confusion over the path forward and disagreement with Harreld’s justification.

ARTICLE CONTINUES BELOW ADVERTISEMENT

In announcing the merger, Harreld cited findings from a group of foundation and alumni association leaders tasked last summer with exploring ways the two entities could improve collaboration.

But in his emails, Kueter disputed any assertion the group’s report advised merging.

“The study did not make such a recommendation,” he wrote. “Structural issues were not part of its purview.”

Alumni Association members, revenue

Richard Pratt / The Gazette

Rather, according to emails, the group spent months meeting with stakeholders, collecting data and considering ideas for collaboration.

“The engagement arm and the development arm must work closely together, sharing intelligence about individuals and collaborating on mutually beneficial activities,” Kueter wrote to the president’s office March 20. “Despite that closeness, strong reasons exist to keep the organizationally independent from one each other.”

RED FLAG RAISED

Harreld’s committee involved staffers and volunteers and looped in university deans, who dug into their wants and needs for alumni outreach and engagement.

The group’s final proposal pitched, among other things, a re-imagined communication strategy, improved student engagement, stronger education of philanthropic opportunities and a review of the financial model.

The group discussed its findings the week of March 20, before discussing the report with Harreld on March 24.

Following that meeting with Harreld, the foundations’s Marshall — who Harreld has said will lead the new organization — sent the president an email outlining principles to keep in mind in pursuing “one university with one unique relationship with one constituent.”

ARTICLE CONTINUES BELOW ADVERTISEMENT

But Steve Wolken, a past Alumni Association board chair who also served on the committee, raised red flags with association leaders.

“I was very concerned about President Harreld’s comments regarding the need for a seamless united appearance and approach,” he wrote.

“He spent a fair amount of time on the structure and financing of the UIAA, even though our committee did not do that,” he wrote. “I did not feel President Harreld fully understood the activities, functions, and importance of this 150-year-old UIAA, nor the devotion to it from the wider universe.”

Current association board Chair Clare Kelly said in an interview that board members question whether Harreld circumvented its bylaws by announcing the merger without a board vote, and they met with an attorney to make sure they are in compliance.

‘NEW, HIGHER LEVEL’

In the hours before Harreld’s public announcement, association advocates messaged him to urge the entities remain separate.

Harreld sent back similar responses to each.

“Frankly, I don’t believe any structure precludes continuing with the strong programs our Alumni Association is delivering to our alumni,” he wrote. “The key issue in my mind is how we take these programs to a new, higher level.”

In face, other institutions have traveled the same path, including the University of Wisconsin.

There, said Mike Knetter, president and chief executive of the UW Foundation, the merger transition has been smooth — and profitable.

“Not only do we not regret this,” he said in March, “we’re really happy that we made the move that we did.”

ARTICLE CONTINUES BELOW ADVERTISEMENT

‘I AM SORRY’

At the UI, questions remain about what will happen to the association employees and their benefits and what the changes mean for alumni.

UI spokeswoman Jeneane Beck said the university is committed to ensuring “employees of both organizations have employment opportunities.” And Kueter wrote there are “agreements in place to ensure the staff lands safely either in the new shop or elsewhere at the UI, depending on their preference.”

Still, he has misgivings about the idea.

Former UI Alumni Association President Vince Nelson spent 26 years at the association before retiring in 2014.

To him, Kueter wrote: “I am sorry. I failed to preserve the organization you built.”

Minutes later, Nelson messaged back.

“It is a sad day in the year that the UIAA celebrates 150 years. I am sure you did everything you could do.”

l Comments: (319) 339-3158; vanessa.miller@thegazette.com

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.