Kalamazoo foundation settles for $23M from W.E. Upjohn Prizes Trust
The Kalamazoo Community Foundation has added another $23 million to its coffers from a settlement with the $44 million W.E. Upjohn Prizes Trust.
KCF works in Kalamazoo to address community matters on child and youth development and educational and community needs.
The $23M settlement
The foundation received the substantial sum as part of a settlement in agreement with PNC Bank, the Michigan Attorney General — and Pharmacia and Upjohn Company, a Kalamazoo-based pharmaceutical company that's now a subsidiary of Pfizer, a New York-based pharmaceutical research company.
The arrangement calls for $23 million of the $44 million W.E. Upjohn Prizes Trust to be given to KCF, while the remainder of the trust assets will continue to be used for the William E. Upjohn Prizes, an awards program that Pfizer uses to honor the special accomplishments of distinguished employees.
The complicated financial negotiations had been going on for about 10 years.
KCF currently manages $375 million in assets.
Millions in area grants
“This is the single largest gift in the foundation’s history. At times, we’ve received significant gifts, but it’s usually through several combined donors,” said Carrie Pickett-Erway, KCF president and CEO.
“Annually, we put out about $17 million in grants, and this will annually generate $810,000 to be invested in the community, representing a 15-percent increase,” she said.
KCF will receive the money shortly as an unrestricted lump sum, she said.
“The gift coming from the trust is unrestricted, meaning it’s used at the discretion of the board, who have been incredible stewards. . . . The majority of the funds will go into endowment, which means it will go into current investment strategies,” she said.
“We’ve been pushing very hard to make sure these dollars are used in the best way to honor (Dr. William Upjohn’s legacy),” she said.
William E. Upjohn and KCF
In 1937, five years after the death of William Upjohn, who originally started the Upjohn Company in 1886, Upjohn’s will established the prize trust to recognize special contributions from his employees.
Upjohn, who inspired the development of KCF in 1925, was not only KCF’s first donor, but also provided in his will that KCF would be the beneficiary of “income not awarded as prizes and the beneficiary of all income should the Upjohn Company cease to exist or cease to function,” according to KCF.