GRAFTON — On the heels of a recession and approaching its 50th anniversary this year, the Windham Foundation has instituted some changes that have raised some eyebrows, causing some to question the foundation's commitment to the town in which the nonprofit remains the largest landowner and employer.
Even CEO Bob Allen acknowledges that when Grafton Village Cheese Company - owned by the foundation - moved some 35 jobs to its new cheese plant in Brattleboro in 2008, it left a sour taste with some residents.
“We built the plant at the very beginning of the recession in 2008,” Allen said. “We had dramatically expanded our capacity,” and then sales sank. “We added a lot of infrastructure and people, and we started making a lot of cheese that was not being sold.”
Allen said the cheese business and the Grafton Village Inn - the foundation's other for-profit enterprise - have struggled to make a profit and adapt to a volatile business climate, including the consequences of cutting back too much on cheese production.
“Like any business, we respond to the times and make adjustments designed to ensure long-term sustainability,” Allen said.
The foundation, he said, “is currently in the best position in at least five years, from a staff and financial perspective, to execute its mission.”
According to the public Internal Revenue Service filings, the foundation's assets were $49.3 million at the beginning of 2008. It reported assets of $55.5 million in 2011.
The cheese operation went through a round of layoffs “back in early 2011 that took place just before my arrival in Grafton,” said Allen, who had worked for many years as president and chief executive officer of the Vermont Country Store before succeeding retiring CEO John Bramley.
And, he said, “Since then, there have been a number of personnel changes (but no planned layoffs) all designed to strengthen the future work of the foundation.”
'It was never intended to be free forever'
But grumblings grew louder more recently, when the board refused to renew Grafton Forge blacksmith Adam Howard's contract with the foundation, drawing his ire.
And Howard said the decision last summer to raise the rent of Cricketer Building forced the closure of the Grafton Artists' Guild gallery that had opened the previous year, “did not fit in with the [foundation's] mission of incubating businesses” in Grafton.
Howard said he paid the rent (raised from $1 per month) of $400 a month for “as long as I could myself,” but when none of the guild members could come up with a $30-per-month contribution, Howard said the group was forced to pull out.
Allen said the foundation waived the rent for the first year to help the artists establish their retail presence.
“It was never intended to be free forever,” said Allen, who made it clear that he did not sign or authorize the agreement.
Allen said the foundation bankrolled $53,333 of expenses for the blacksmith shop over three years.
Both the forge and the gallery were intended to be “self-supporting after a year,” he said.
“That obviously didn't happen,” he said.
Allen also said that at the blacksmith shop, “few, if any educational programs have taken place over the past two years,” although Howard refuted this assertion with examples of students and groups he has instructed.
“I determined that the Foundation's limited resources were not being deployed effectively,” Allen said of the blacksmith shop. “With limited resources, it did not make sense to continue to support it.”
Howard questioned the foundation's spending priorities, pointing out that its trustees are paid for their service to the nonprofit's board. According to IRS filings for 2011, the latest year available, each trustee is paid $22,000 each, with $29,000 paid to the chair.
“How can they pay their trustees $20,000 each,” he asked, yet not be able to support the $20,000 stipend he received to operate the forge and provide educational opportunities in the community?
Allen said what he would like to see in the blacksmith shop is a self-supporting business with an educational component in line with the mission. He also hoped to see an artisan produce a wide variety of objects for sale at a range of prices that would make the wares more affordable to a wider range of visitors.
“There is no intention of just closing” the forge, Allen said.
Adapting to a seasonal economy
The foundation started both the cheese manufacturing business and the inn in the 1960s “with the intent that they would create local jobs and generate a profit that would be used by the Foundation to further its work of promoting Vermont's rural communities,” Allen said.
Even despite the loss of cheese jobs to the facility in Brattleboro, the foundation employs 36 staff in Grafton between workers at the inn and general maintenance staff.
Virtually all the business in Grafton is seasonally dependent, Allen said - especially the Grafton Inn, where the most recent innkeepers, a husband-and-wife team, were recently let go.
“The inn was being run as if it were a year-round operation,” Allen said, and, as a result, “we have increased the number of part-time and decreased full-time staff due to the seasonality.”
But, Allen said, “We may be the only inn that offers health insurance benefits if an employee works 20 hours a week.”
Allen said the foundation's golden anniversary is the “perfect time to ask the board to rethink the mission of the foundation, and ask what do we want to accomplish in the next 20 to 30 years.”
“I don't ever envision steering very sharply from the mission of being a real source of support for rural communities around Vermont,” Allen said, “but our goal has to be to do with limited resources as much to sustain them as possible with a particular eye towards projects that are sustainable and particular to a community.”
“We will continue to do grantmaking but we'd also love to create another operating business” - perhaps something related to food production, he said.
He noted that the foundation's assets of land and buildings could be used to that end.
“We have 1,500 acres in Grafton and 500 acres in Brattleboro,” he said. “The current use is not [particularly] a value-added product.”
Allen said he would love to “have a young farm couple or person” approach the foundation with an idea for better use of the acreage.
Allen also said he is meeting with a representative from the Compass School in Westminster about a project that its students can do.
“I want to hear what they envision when they look at our greenhouses,” he said. “What could be done there?”
Allen said he can envision an entrepreneur growing heirloom vegetables and/or flowers to sell to local hospitality businesses. He said the foundation hosts at least 20 full-property weddings a year and could use the flowers.
“We want to be a resource for incubating businesses,” he said. “We will continue being the start for giving somebody an extra leg up for a 501(c)3 [nonprofit] or for-profit. That is a great mission.”