A Jan. 21 article incorrectly identified Ray Kroc as the founder of the McDonald's fast-food chain. Kroc bought the chain in 1961 from Richard and Maurice McDonald. (Published 2/6/04)
The Salvation Army will receive a $1.5 billion bequest from McDonald's heiress Joan Kroc -- one of the largest individual gifts ever made to a charity, the organization announced yesterday.
The donation is designated to build more than two dozen community centers across the country and pay part of their operating costs. It represents a "new era" for the 138-year-old Christian charity, a jubilant W. Todd Bassett, national commander of the Salvation Army's U.S. operations, said at a news conference.
It far eclipses other individual donations to the Alexandria-based organization, which took in $2.5 billion in revenue last year. Kroc, who died in October, was also responsible for the group's largest previous donation, $92 million in 1998 to build an elaborate community center in San Diego.
The size and intent of the bequest represent a departure from the traditional strategy of modern-day philanthropists, according to academics who study philanthropy.
"Most big gifts go to the big universities, hospitals, big art museums -- that kind of thing," said Eugene Tempel, executive director of the Indiana University Center on Philanthropy, adding that those organizations are better prepared to appeal to wealthy donors. "For an organization like the Salvation Army to get a gift like this is overwhelming."
Salvation Army officials and others predicted yesterday that Kroc's donation will place unprecedented demands on the group, which now must raise an additional $40 million to $60 million annually to help support the new centers. They will be similar to the San Diego center, with its basketball courts, three swimming pools, regulation ice hockey rink, arts center, indoor skateboard park and worship space.
Part of the challenge, Tempel said, will be convincing smaller donors that the group needs their money. "The temptation will be to say, 'Well, my small gift doesn't matter anymore,' " he said.
The Salvation Army was founded in England in the 1800s by evangelist William Booth to offer "soup, soap and salvation" to the fallen and needy.
Its U.S. operations offer a network of programs, including soup kitchens, addiction recovery centers, disaster assistance and after-school activities. It also operates almost 1,700 thrift stores, 350 community centers and more than 200 day-care centers.
Much of the $1.4 billion that the Salvation Army received nationally last year from the public came from dollar bills stuffed into Christmas-season kettles manned by bell-ringing volunteers, small checks from its mail appeals and thrift-store purchases, Salvation Army officials said. It earned 12 percent of its revenue from government contracts to operate day-care centers, prison release programs and housing for the elderly.
In the Washington area, the organization runs 12 small neighborhood centers, a 136-bed addiction-recovery facility in the District and two transitional housing programs for homeless mothers and their children. Yesterday, Salvation Army officials said they do not expect the new centers to replace any of its existing facilities.
In her will, Kroc stipulated that half of her $1.5 billion bequest be used to build the new community centers and that the other half go to an endowment to help pay for operating the centers.
Salvation Army chapters that want a new center will have to raise the remainder of the annual operating funds. The organization will not be permitted to use any of Kroc's money to pay for existing programs.
Maj. George Hood, a Salvation Army spokesman, said yesterday that the Salvation Army will try to attract contributions from corporations and wealthy private donors -- but it hasn't figured out how.
Joan Kroc was 75 when she died last year. She inherited her estate, valued at about $2 billion, from her husband, McDonald's founder Ray Kroc, who died in 1984. They had no children together; Joan Kroc had a daughter from a previous marriage and four grandchildren, and estate officials would not discuss how her family was provided for.
The estate has announced several other large gifts, including $200 million to National Public Radio and $60 million to the Ronald McDonald House charities.
Ray Kroc's involvement with the Salvation Army was more folksy than financial. In the 1950s, he used to take coffee and burgers to holiday-season bell ringers at Salvation Army kettles in downtown Chicago. Later, in California, he occasionally served as a bell ringer.
But after his death, Joan Kroc gave the San Diego chapter money to build and operate the elaborate Salvation Army Ray and Joan Kroc Corps Community Center.
Hood said that the estate's trustees alerted the Salvation Army several weeks ago that it would receive an "enormous" amount of money from her estate, and that its officials were stunned to discover just a few days ago that it totaled at least $1.5 billion.
"Mrs. Kroc liked to make an impact," said Dick Starmann, spokesman for the estate. "I think she did."