Weinberg's mysterious ways live on in unusual foundation Little is known about trust,despite its size

THE BALTIMORE EVENING SUN

Billionaire Harry Weinberg died 10 months ago, but his secretive and reclusive ways live on in his namesake foundation, one of the largest charitable trusts in the country.

With at least $600 million before Weinberg's death, the Harry and Jeanette Weinberg Foundation Inc. ranks among the top 20 foundations in assets.

When his estate is settled, the Weinberg Foundation will be catapulted into an exclusive group of billion-dollar philanthropies, including the Ford Foundation, the John T. and Catherine D. MacArthur Foundation and the Pew Charitable Trusts.

But there are key differences between these high-profile groups and the Weinberg Foundation, and those differences frustrate some local charities, which have been hoping for an infusion of cash since Weinberg's death Nov. 4. Some of those differences:

* Perhaps the most unusual thing about the Weinberg foundation is the lengths to which it has gone in order to avoid any public discussion. Its charter states: "If any charitable organization at any time challenges, directly or indirectly, the manner in which the trustees exercise their discretion on any subject . . . such charitable organization shall forever be barred from receiving any distributions."

* With an unlisted telephone number and its policy of "pre-determining" grants, the foundation is virtually inaccessible to all charities, unless the charity's board or staff has an ongoing relationship with the foundation, or knows someone who knows the Weinberg Foundation's five trustees.

* Because the Weinberg Foundation says it will not consider unsolicited grant applications, proposals from some non-profit agencies were never acknowledged. Yet some groups that queried by letter subsequently were invited for interviews.

* The foundation produces no annual report nor any other regular publication. A list of its contributions is available only through its tax forms, copies of which are normally filed with the Maryland attorney general's office four months after the foundation's fiscal year ends in February. The 1990 tax form had not been filed as of today

* While foundations with more than $100 million in assets have an average staff size of 21, the Weinberg Foundation has one full-time staff person, according to the Foundation Directory, a national publication. However, the foundation is reported to be searching for an executive director.

Under the laws that govern private foundations, all of this is legal. It also is the way the Weinberg Foundation has chosen to do business since it was founded 32 years ago. But those connected with local charities have begun to question the organization's sense of propriety and fairness.

"My concern is that they're giving money out and there's no process," said one non-profit agency director, who requested anonymity. "Maybe legally they can be secretive and give money out at breakfast, but there doesn't seem to be any feeling for appearances."

Another source who works with non-profits said: "It is so completely an aberration it is beyond belief."

Lester A. Picker, of Pyramid Associates Inc., an Elkton consulting firm for non-profits, says he worries that the Weinberg Foundation has missed a chance to shape Baltimore's social services agenda.

"It is certainly not taking advantage of the expertise available to make sure their money is spent as wisely as it can be, and as leveraged as it can be," Picker said.

"A foundation of this size could make an enormous difference, could really effect definite, positive change in many social problems in Baltimore if they took a leadership position in those areas."

The three local trustees -- brothers Nathan and William Weinberg, and accountant Bernard Siegel -- declined to be interviewed for this story. William Weinberg referred a request for an interview back to the foundation office. Nathan Weinberg and Siegel did not return messages left on their answering machines.

The remaining trustees, Robert T. Kelly Sr. of Scranton, Pa., and Alvin Awaya of Honolulu, Hawaii, could not be reached for comment.

And the office's one-man staff said only trustees may give interviews. He declined to identify himself on the telephone, but promised to forward the request.

WEINBERG'S LEGACY

Born in Eastern Europe in 1908, Harry Weinberg grew up poor in southwest Baltimore. He dropped out of school at age 12, but he was ambitious and hard-working even as a boy. He liked to say he made his fortune according to an old proverb: Buy land -- they're not making it any more.

It was land -- in Baltimore and, more important, in Hawaii -- that made up the bulk of a fortune that Forbes magazine estimated last year at $950 million. When Weinberg died in Hawaii at 82, a year after the death of his wife, Jeanette, almost everything went to the foundation he had created in the couple's name in 1959.

In fact, although it was only with Weinberg's death that the foundation's size first became widely publicized, it had been quietly growing into one of the nation's largest philanthropies in the two years before his death.

Weinberg, diagnosed with bone cancer in 1982, began moving his money into the foundation as his health deteriorated. When its 1988 fiscal year ended in February 1989, the foundation listed $352 million in assets.

A year later, it had more than $650 million and had given away $21.6 million.

The foundation's tax forms for 1990, the primary source for such information, are not yet on file at the state attorney general's office. By federal law, however, a group with $600 million in assets over an entire fiscal year would be expected to give away up to $30 million annually. When the estate, estimated at $300 million to $400 million, is settled, the foundation would have to give away $45 million a year.

Under its charter, money distributed by the Weinberg Foundation must go to groups serving the disadvantaged: 25 percent to Jewish groups, 25 percent to non-Jewish groups, and 50 percent to qualifying groups of any kind.

The foundation does not accept applications, a condition published in national and state foundation directories. This is an unusual, but not unique, restriction.

The California-based Arnold and Mabel Beckman Foundation, for example, also makes "pre-determined" grants. And, while it has given away as much as $44 million in a single year, it also operates without a listed telephone number and with no salaried staff.

However, according to sources in Baltimore's non-profit community, some charities have been invited to make their pitch to the Weinberg Foundation after sending unsolicited proposals. Other groups, such as Midtown Churches Community Association, were contacted by the trustees and have no idea how they came to the foundation's attention.

Such seeming discrepancies breed rumors. One story currently in circulation has the foundation giving out $1 million over breakfast.

Recently, the charity grapevine carried the word that the foundation had stepped up its giving and was close to hiring an executive director. None of these stories could be confirmed.

Yet there is little evidence of a widespread windfall for local charities. The Weinberg Foundation remains an enigma. What it does this year won't be known until it files tax forms next year. Still, no one dares to criticize it publicly -- because every charity clings to the hope of winning this lottery.

SUCCESS STORIES

Three local non-profits confirmed they have received gifts or pledges since Weinberg's death. The Bais Yaakov School for Girls declines to discuss its $944,000 gift, although one employee said it was pledged before Weinberg's death. Meals on Wheels got $500,000 for a central kitchen, while St. Agnes Hospital will get $250,000 for the Chest Pain Center in its new emergency room.

The United Way also receives an annual contribution, and the Salvation Army and Goodwill Industries have been promised $1 million each.

In addition, the Salvation Army has been promised $75,000 for one of its shelters.

How did they do it? Personal contacts helped in the case of Meals on Wheels. Fay Carey, marketing director for the program, said someone on her agency's board knew someone within one of Weinberg's corporations.

That man -- Carey declined to identify him -- acted as the go-between for Meals on Wheels and the foundation. Within a few weeks of a February meeting, the group was notified that it would get a grant.

Old ties also help. St. Agnes Hospital, where Harry Weinberg and his brothers were treated free as boys, received many gifts while Weinberg was alive. Kyle Swisher 3rd, executive director of the hospital's foundation, used to deal directly with Harry Weinberg. Now he contacts Nathan and William Weinberg.

"They don't feel they need a large staff," Swisher said of the brothers, whom he describes as "delightful, personable" men who prefer carry-out submarine sandwiches to luncheon invitations.

"I don't think they're concerned with appearances," he added. "They'll be judged by their deeds, which are significant."

Judging by the list of gifts from 1989, the last year for which the foundation's contributions are available, the foundation's deeds often have a personal connection, although it may not be readily apparent.

Consider the case of Dyersburg, Tenn., a place with seemingly no connection to Weinberg, who spent his life in Baltimore, Hono

lulu and Scranton, Pa. In 1989, a dozen charities in the western Tennessee town received small grants ranging from $100 to $1,250.

The connection? Heckathorn Manufacturing Corp., a privately held factory that makes hand grenade parts and exhaust pipes. Weinberg bought it in the late 1980s and the foundation now owns it, said Heckathorn Vice President Gerald Hamm.

Through a matching program, local charities such as the Dyersburg Church of Christ ended up receiving $500 from the Weinberg Foundation in 1989. At least, that's how some Dyersburg charities understand the program. Hamm said he was not allowed to give out any information about the grants.

THE BIG WINNER

When Weinberg died, one charter condition was widely publicized: the cap on donations to the Associated: Jewish Community Federation of Baltimore.

The Associated, under the leadership of Darrell Friedman, had been treated well by Weinberg. But the foundation's charter, which went into effect with Weinberg's death, limited gifts to $2 million in any 12-month period.

This limitation does not apply to the Harry Weinberg Family Foundation Inc., a supporting foundation Weinberg set up specifically to benefit the Associated.

In 1989, this foundation received almost $18 million in stock from Weinberg's Maui Land and Pineapple Co., which now generates dividend income.

The Jewish Times reported in November that this foundation had an overall value of $90 million. However, the Associated, saying it respects the Weinberg family's desire for privacy, will not release any other details about the Family Foundation.

So, of the $21.6 million given away by the foundation in 1989, about $21 million went to the Associated, directly or indirectly. Of the remaining gifts, the next largest was $110,000 to the Talmudical Academy here in Baltimore.

Given the charter's conditions, these patterns are destined to change, as illustrated by the $1 million pledges to Goodwill and the Salvation Army.

Although the Weinberg Foundation could continue to give up to 75 percent of its annual grants to Jewish-affiliated charities, at least 25 percent -- $7 million or more -- would be earmarked for other groups.

As to the foundation's tradition of secrecy -- the charter and Weinberg's will do nothing to discourage that.

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