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National Board Puts Legacy Fund Under Microscope

By November 17, 2023January 6th, 2024No Comments

Feedback from statement on 6-year-old’s slaying also gets scrutiny.

By P.C. Staff

SAN FRANCISCO — The Japanese American Citizens League conducted its quarterly business meeting on Nov. 4 at the organization’s relatively recently repainted national headquarters building, beginning with JACL National President Larry Oda going through the pro forma aspects of any National Board meeting — calling the meeting to order, taking roll and getting the minutes from the previous meeting approved.

JACL National President Larry Oda

As part of his president’s report, Oda noted that he had attended the previous weekend’s Crystal City pilgrimage in Texas. “This is the first time I’ve been to where I was born in a long time,” he said, before thanking JACL National Vice President for Planning and Development Gary Nakagawa, a member of the Houston JACL Chapter for his hospitality, which included being treated to Central Texas barbecue.

Oda also mentioned JACL’s involvement in helping produce two performances of “Defining Courage” — which was also presented at July’s National JACL Convention in Los Angeles —in San Jose, Calif., on Sunday Oct. 22, also crediting former telejournalist Jan Yanehiro for her role in helping to bring the live-and-multimedia tribute to the WWII military service of Nisei to the Bay Area.

Continuing on the topic of “Defining Courage,” JACL Executive Director David Inoue noted that the show’s producers, David Ono and Jeff MacIntyre (both of KABC TV Channel 7 in Los Angeles), were preparing to bring it to the Kennedy Center For the Performing Arts in Washington, D.C. on Nov. 11; he also noted that JACL was involved in the Sept. 9 presentation of “Defining Courage” held at El Camino College in Torrance, Calif., that was held to raise funds for the Hawaii Community Foundation’s Maui Strong Fund.

It being the first National Board meeting since the JACL National Convention, Inoue gave his postconvention assessment in his report, saying he thought it was a “very, very successful convention in the sense that … it was pulled off despite some wrinkles, to perhaps understate it.” It was a reference to how the JACL staff had scramble just days before it was set to begin to find alternative accommodations because of the hotel workers strike — still ongoing — as well as different venues for the event’s various workshops and plenaries. “We are still trying to pin down the Doubletree about what they want for our liability for withdrawing,” he said, alluding to how JACL decided to break the contract rather than cross the picket line.

Inoue also reported that the Bureau of Land Management was due to release its environmental impact study that would likely recommend a “blended solution” that could include a “certain amount of setback, whatever number of miles” to mitigate the expected impact on the viewshed the proposed construction of the 400-unit Lava Ridge wind turbine farm project would have on the site of the former Minidoka War Relocation Center in Idaho.

Inoue also said JACL had issued a statement following Nebraska’s Gov. Jim Pillen over his remarks made about an investigative journalist Yanqi Xu — a Chinese national — regarding her Norfolk Daily News article that reported on unsafe nitrate levels found on hog farms owned by the governor that might be leaching into groundwater. According to the article, “High nitrate has been linked to a variety of health conditions, including cancer in children.” (See Pillen was quoted in news reports as saying: “All you got to do is look at the author. The author is from communist China. What more do you need to know?”

Looking ahead to the next two JACL National Conventions, Inoue said the 2024 convention will be July 10–13. “I believe the Philadelphia Chapter is considering doing something on the 14th as well,” he said, adding that the 2025 convention is tentatively set for New Mexico, in Albuquerque.

Inoue also reported that the JACL headquarters had new security lights installed, along with new security cameras in front of the building. NCWNP Regional Director Patty Wada wanted it noted that credit for the upgrades should go to the Japanese Cultural and Community Center of Northern California “for installing and paying for those security cameras.”

Inoue wrapped up his report with news that the lease for JACL’s office space in Washington, D.C., ends in February 2024. “We are looking at possibly staying in our current space, possibly moving either within the building or across the street, where there is a building where several other APA organizations are located,” he said. Another possibility: partnering with another organization for office space large enough for two organizations to occupy or just a smaller space just for JACL.

Upon completion of the executive director’s report, Oda skipped over the secretary-treasurer’s report because there was no update and moved on to the next item, which was an audit committee report. “We had hoped to have the audit completed by this meeting but because the … previous audit manager decided to move on, it put us back a couple of weeks. So, we’re going to have a meeting next week for a draft,” he said.

Oda also said that JACL’s new investment manager, Vanguard, could potentially save the organization $180,000 per year, in part for the “lesser fees that they charge,” adding, “we’ll see if that comes to pass.”

EDC Gov. Paul Uyehara

EDC Gov. Paul Uyehara

Eastern District Gov. Paul Uyehara provided an update on the Legacy Fund Review Committee by giving some background about the impetus for the creation of said committee, namely to “just find out what the basic facts are about the endowment, and whether the records are in order, and if things are being managed properly.”

After providing an overview of the complex, years-in-the-making  problem — the basic facts about the origin of Legacy Fund, whether the records were in order and even fundamental questions such as how much money is in the endowment — Uyehara related how he and outgoing interim business manager Randall Gaines and recently hired Director of Finance Thomas Fernandez had in October met “three or four times or two hours each, to kind of wade through the books.”

Uyehara said the consensus was that there were “three numbers” that were needed to understand the Legacy Fund: its corpus, the inflation-adjusted corpus and the trailing fund value. “We need those three numbers in order to put them into the policy and consider what those numbers mean, in terms of our exercising a prudent judgment about how much money should be spent from the endowment for the subsequent two years,” he said.

Based on those three numbers, a determination was made that as of Dec. 31, 2017, the core of the Legacy Fund endowment was about $5.2 million, a figure that Uyehara said, “We are … especially concerned about protecting in order to make sure that the endowment is a perpetual fund.”

Part of the problem going forward from that point in time is that there was an incorrect belief that funds allocated for spending that were not actually spent became a “quasi-endowment” that was still part of the overall corpus and thus eligible to be used to grow the Legacy Fund, when instead those unspent funds should have been kept in a separate account or at least somehow segregated and tracked separately — meaning the quasi-endowment did not exist. “The committee never really found evidence that there was any quasi endowment, but we were still looking for it,” Uyehara said.

“And one of the things that was important is — and Tom [Fernandez], correct me if I’m wrong — but I’m pretty sure this part is pretty definite at this point, that in 2019 and 2020, there was money that was allocated by the budget that was unspent. … And we actually said, ‘Well, why would you have money that’s still in the endowment that we decided to spend?’ And the answer was, well, staff thought that if you didn’t withdraw the full allotment for the year, by the end of the year, you kind of lose it, like use it or lose it. So, we never took it out.

“And then we kind of poked around and said, ‘Well, who said that? And what was the basis for that?’ And then the purported source of that conclusion said, ‘Naw, I never said that. I don’t know why we would say that.’ And so then we realized, ‘OK, it was just a misunderstanding.’ … So, there is this $140,000 that’s been in the endowment from the years 2019 and ’20 that shouldn’t be there, and so that’s pretty significant.

“And it doesn’t belong there. And then we’re going to have to figure out a way, No. 1, we need to take, take the money and move it. But we have to figure out before we move it, if we should take the exact amount that’s underspent or if we need to make some kind of adjustment to that takes into account the fact that it wasn’t timely withdrawn.”

Uyehara continued: “The decision that was made is to use the so-called inflation adjusted corpus measuring stick rather than using an inflation-adjustment on a historic-dollar value. The difference is that the inflation-adjusted corpus takes into account the reinvestments that have been made since the ’90s and tries to protect that as being, like, the nest egg that we want to really be concerned about because we have a legal duty to try to perpetuate the endowment forever, so that it can support JACL forever.

“So, we need to know that number because it goes into the decision-making process. … we all know what the exact numbers are now but we can kind of tell, looking at the projections that we did, the calculations that we did in 2022, at the time of the 2022 convention, taking into account that the present-day value of the endowment.

“It looks like the inflation-adjusted corpus for this year is going to be somewhere around $10 million, and the total fund balance as of the end of August was $8.4 million [dollars], so significantly less than the inflation-adjusted corpus. And the corpus is around $5.3 million [dollars].

“So, the very concrete question is, whether this happens at the level of [Secretary-Treasurer] Jonathan [Okamoto] putting together a budget proposal for the board, or if it happens next summer, the National Council authorizing the budget, is going to be: When we look at these numbers now and look at market conditions and JACL needs, cash and everything, is 4% going to be too high for the next budget?”

VP General Operations Carol Kawamoto

Following Uyehara’s update, next up was a report by General Operations VP Carol Kawamoto wanted to focus on four areas: convention, personnel, education (including scholarships) and an administration report. She let PSW Gov. Ryan Yoshikawa report on convention matters.

Yoshikawa elaborated on what Inoue had already reported, that the New Mexico JACL was the chapter likely to host the 2025 JACL National Convention. Noting that nothing concrete had yet to be implemented, he reported that the New Mexico Chapter has nevertheless had some discussions with possible hotel sites. “I’m planning on having another call with them later in November, hopefully to hash out what their possible bid presentation would look like,” he said. “Hopefully, we can have something that’s on track with what we traditionally do, where a chapter can bid, and they’ll be prepared before the year prior’s convention, we can have a better plan for the 2025 convention.”

Moving on to personnel, Kawamoto called on JACL National Legal Counsel Ken Massey to go over the executive director’s evaluation process. He began by noting that the evaluation process for the ED has not occurred for the past two years. “After meeting with the Personnel Committee and reviewing the materials from the last evaluation cycle, I put together the self-evaluation form and then the kind of group evaluation form for the ED,” said Massey.

“So, pending any final comments from Larry or Carol, I’ll probably circulate those shortly after this meeting, early next week, with the idea that people would have three weeks or so to do them and then the process of sort of digesting the evaluations and going over them over the next month so that in early 2024, we could have the evaluation report completed and then circulated accordingly.”

Kawamoto then called on Scholarship Committee Chair David Kawamoto to report on scholarships. He began by recognizing the work such JACL staffers as Patty Wada and Matthew Weisbly did for JACL’s scholarship program. He added that his written report was submitted to participants in advance of the meeting but that it included the scholarship recipients and the program’s timeline.

Called up next was Education Programs Manger Matthew Weisbly, who reported on his recent activities, including the most-recent scholarship program, which took up the bulk of his workload. “Currently, we’re working on the 2024 program. Patty [Wada] and I just went through the online application, setting them up. And it is we hope to get others out either right before Thanksgiving or right afterwards,” he said. “There’s still a few minor tweaks that we have to make, but again, the goal is to get those out. And then the deadlines will be March and April respectively, depending on the scholarship category.”

Weisbly also mentioned attending the recent JACSC education summit held in Little Tokyo at JANM and the Poston Pilgrimage in Arizona in mid-October, and reminded that the California Library Grant’s deadline was Nov. 15.

He also alluded to moving forward on another grant dating back to 2019 that was delayed because of the Covid-19 pandemic, a project to digitize for preservation letters, chapter newsletters, handbooks, etc., as well as recording oral histories of Japanese Americans living in areas that have had a dearth of such endeavors. Finally, he mentioned how he has been working to finalize a yet-to-be launched website that will house “all of our educational materials.”

Fernandez gave his director of finance report after the lunch break. In a short, JACL’s status quo is that while it does not have many big “glaring huge issues,” the organization is “over budget, yet we are performing to our budget.” Regarding known overages, he noted as an example the expenses for the interim business manager and bookkeeper, as well as the fees paid to the recruiting firm utilized to fill the finance director position. Another expense that put JACL over budget was the “additional cost of moving the convention on short notice,” a reference to what was also mentioned in the executive director’s report.

VP Public Affairs Seia Watanabe

Next came the report of VP of Public Affairs Seia Watanabe, who gave a “quick overview of the statements we released since convention,” five in total. They were on:

  • the 60th anniversary of the March on Washington;
  • the Jacksonville, Fla., mass shooting;
  • condemnation of the attack on Seattle’s Wing Luke Museum;
  • denunciation of the slaying of a 6-year-old Palestinian American boy; and
  • the response to the xenophobic statements made by Nebraska’s governor.

A lengthy discussion ensued over the statement released regarding the child’s slaying (see and the feedback that was received, ranging from whether JACL was proscribed from commenting on international events, i.e., the deadly attack on Israeli citizens on Israeli territory by Hamas militants and Israel’s subsequent counterattack on Hamas in the Gaza Strip to whether JACL should have only addressed the killing as a possible hate crime, whether the statement was partisan, too strong or not strong enough and, on a related note, whether the executive director should express his personal views in the Pacific Citizen on the Israeli-Hamas conflict apart from his role as the ED.

Regarding the statement, Uyehara felt it could have been edited to be “80% cleaner and more focused” without losing the message of what the statement wanted to express. Pacific Citizen board Chair John Saito Jr., meantime, believed that using words like “murder” and “murderer” in the statement was problematic because “you’re still presumed innocent until proven guilty. … you have to be careful here, too. He hasn’t been convicted.”

VP Planning and Development Gary Nakamura

Oda thanked everyone who participated in the discussion and moved on to the next report by Gary Nakamura, VP, Planning and Development. Regarding the Centennial Education Fund, he reported, among other items, by way of Membership and Fund Development Program Director Philip Ozaki that the fund was at about 67% of the $3 million goal.

The next report was from 1000 Club & Membership and Services VP Dominique Mashburn, with assistance from Membership Manager Ashley Bucher. Mashburn reported that there was a decrease in 2023 compared with 2022, when an anonymous donor who had $13,000 they would match with additional Life Memberships. “So, you’ll see this decrease happened in 2023 because we don’t have that gift matching happening this year,” said Mashburn. “Not necessarily that this is a negative thing at all, whatsoever, but just to notate the power of additional gift giving. It really does impact us because we were so excited at this point last year about how we were close to positive growth — and we actually are still on the cusp of that.”

VP, 1000 Club & Membership and Services Dominique Mashburn

Bucher reported that for the membership CBL proposal, “We’re getting ready to resubmit for the same thing for next year’s convention. Essentially, we’re resubmitting the same proposal except maybe for premium category names,” she said, adding that some ideas are time-based names like Centennial ($100) and Bicentennial ($200) or metals like bronze, silver and gold. “We’re just getting that final feedback now and then we are excited to resubmit this and hopefully have it pass.”

Bucher also reported on Membership Month. “This happened this past October. The goal of this Membership Month campaign was to really thank our members and make them feel special and increase engagement with our social media and online and also the P.C. and ultimately increase renewal rates.” Related to that was a New Member Orientation that took place on Oct. 19. Also mentioned were new membership cards that are printed on sturdier material.

PNW Gov. Sheldon Arakaki

PNW Gov. Sheldon Arakaki gave the Governor’s Caucus Report. He shared that the Caucus met on Oct. 26. This was followed by the Youth Council Report, from National Youth/Student Council Chair Mika Chan and National Youth/Student Council Representative Lana Kobayashi. Among the items they reported on was the Fall Retreat that took place Oct. 13-15 in San Francisco, with the Spring 2024 Retreat set to take place March 22-24 in Salt Lake City, which will include a visit to the JACL Credit Union.

Pacific Citizen Board Chair John Saito Jr. gave the P.C. report, noting that all the board positions had been filled, which was followed up with the first meeting of the complete board in October. He reported that the P.C.’s Holiday Issue theme is Celebrating Connections and that Board member Lisa Shiosaki Olsen’s idea to share favorite family recipes will be in the Holiday Issue. Saito also said an idea that will come up is a photo contest to help with audience engagement. Finally, he reported on a proposal to increase by $5 the surcharge for print subscribers, the first increase in seven years.

The last order of business to be discussed was from JACL National Legal Counsel, who mentioned that JACL staff will probably have anti-harassment training in 2024.

District governors in attendance were Sheldon Arakaki (PND), Carol Kawase (NCWNP), Eric Langowski (MD), Lisa Shiosaki Olsen (ID), Brian Tsukimura (CCD), Paul Uyehara (ED) and Ryan Yoshikawa (PSW).

Officers present were Carol Kawamoto, VP, General Operations; Dominique Mashburn, VP, 1000 Club & Membership and Services; Gary Nakamura, VP, Planning and Development; Jonathan Okamoto, secretary/treasurer; and Seia Watanabe, VP, Public Affairs.

Also present were Ken Massey, JACL National legal counsel; John Saito Jr., Pacific Citizen board chair; Mika Chan, chair, National Youth/Student Council; and Claire Inouye, representative, National Youth/Student Council.

JACL staffers present were Executive Director David Inoue, NCWNP Regional Director Patty Wada; Education Programs Manager Matt Weisbly;  Youth and Programs Director Cheyenne Cheng; Program Director, Membership and Fund Development Philip Ozaki; Norman Y. Mineta fellow  Bridget Keaveney; Daniel K. Inouye fellow Jack Shimabukuro; Membership Manager Ashley Bucher; Finance Director) Tom Fernandez; and Operations Manager Bridgette Watson. Visiting as a guest was former JACL National President David Kawamoto.