Poor get more say in LEAF bounty

The foundation in control of half of tobacco funds is changing its ways

The foundation that controls half of the state's $4 billion-plus share of the 1998 national tobacco settlement is sharply changing the way it awards grants, giving the state's poorest counties a big say in picking many of the projects that will get money.

The Golden LEAF Foundation was formed to help the state's neediest counties and those historically dependent on tobacco income. Its 15-member board is appointed by the governor and leaders in the legislature.

Until now, in an annual cycle of grants, the foundation itself decided which proposals were worthy. The results have sometimes been projects -- such as experimental crops or unusual tourist attractions -- that made easy targets for critics, and in recent meetings members of the foundation's board have complained about the quality of some of the proposals.

On Thursday, they voted to add 13 counties to a year-old program that sends foundation staff out to rural counties where they help community leaders assess their needs and develop grant proposals.

The idea is to let the people who know the communities best decide what they need, instead of Golden LEAF's board trying to do that based solely on the kind of random proposals that had been "coming in over the transom," said J.T. "Tommy" Bunn, the chairman of the board.

When entire communities pick projects, he said, the projects are highly likely to be successful.

Valeria Lee, the foundation's long-time president, said that the board's decision could quadruple the $10 million in the current budget for such county-chosen projects, while the $10 million budgeted now for the random proposals could be slashed by as much as half.

Powerful enemies

A year ago, Gov. Mike Easley called on Golden LEAF to extend water and sewer service and to do other things to foster job growth in rural areas. The county-generated proposals often include just such things.

The foundation also makes other types of grants, including some for large one-time economic development projects to lure new employers.

The foundation invests the annual payments it gets from the settlement, and doles out grants mostly from investment income.

It has often been a target in the legislature, with members of both parties often casting covetous glances those investments, which now exceed $700 million. Members of the Golden LEAF board have long worried that state leaders would take some or all of the money, a fear underlined in 2002 when legislative leaders strong-armed the foundation into funding a $60 million biotechnology initiative.

They have said in recent meetings that relying more on community-chosen projects would reduce the number of sometimes-powerful enemies they have been generating by turning away dozens of proposals each year. They also are trying to boost the visibility of the foundation's good deeds. They hired a larger public relations firm about three months ago, Bunn said.

Legislative target

Conservative leaders in the legislature such as Rep. Paul "Skip" Stam, a Wake Republican, have called it a slush fund controlled by political appointees, and say that it should be abolished and its money rolled into the state's general fund. Stam said Thursday that eliminating the foundation was his first choice, but at the very least decisions about the projects should be made directly by county commissioners rather than the Golden LEAF board.

Not only have Republicans attacked the foundation, but last year Sen. Clark Jenkins, an Edgecombe Democrat, filed a bill that would have killed the foundation and put the money under control of a private not-for-profit group. Golden LEAF, he said, wasn't doing enough to help counties hurt by drops in tobacco income.

Giving the counties more say was probably a step in the right direction, Jenkins said, though he added that he would have to see the specifics before saying much more.

Focus on the poorest

The new program focuses on the 41 so-called Tier 1 counties, which are essentially the state's poorest. Golden LEAF will make grants to about half of them each year. Then, after two years, it will start back through the list for a new round of grants.

Eventually the foundation may bring other counties into the program, but the board hasn't addressed that yet, Bunn said. Also, he said, the new emphasis on the community assistance grants don't mean communities in other counties can't apply for other kinds of grants.

Hertford gets a grant

One county that has already gone through the process is Hertford, which got about $2 million -- equal to nearly 10 percent of the annual budget.

Most of it went for education and worker training. Hertford County manager Loria Williams said that the process worked so well that there was little disagreement about the final choices.

"It was the easiest thing I've ever gone through, and I've been in government quite a while," she said.