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2011 Annual Report


“We inspire people to plant, nurture, and celebrate trees.� Mission Mission of of the the Arbor Arbor Day Day Foundation Foundation


Fiscal Year 2010-2011 Annual Report

Table of Contents Message from the Chief Executive, John Rosenow Board of Trustees Message from the Chair, Bill Kruidenier

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Arbor Day Foundation Programs Trees for America Tree City USA Tree Line USA Tree Campus USA Nature Explore Celebrate Arbor Day Rain Forest Rescue Conservation Trees Arbor Day Farm

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Financial Report and Audit

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Dear Members and Friends, President Theodore Roosevelt said, “The conservation of natural resources is the fundamental problem,” adding: “Unless we solve that problem, it will avail us little to solve all others.” This was not mere rhetoric to Roosevelt. During his administration, he helped create the U.S. Forest Service, with the mission to manage America’s forestland for the public good. The Arbor Day Foundation similarly places great importance on putting ideals into action. For instance, the generosity of members and corporate partners enabled the Foundation’s Trees for America program to replant more than 4.8 million trees in forests last year, in partnership with the U.S. Forest Service and the National Association of State Foresters. In response to natural disasters in north Alabama and Joplin, Missouri, Trees for America is helping rebuild communities by replanting lost trees. Volunteers and local officials are also contributing greatly to our shared mission. In 2011, 481 communities that participate in Tree City USA advanced beyond basic standards to receive a Tree City USA Growth Award, demonstrating their commitment to improving local tree care. Nature Explore continues to spark the spirit of conservation in children through research-based outdoor learning opportunities. Nature Explore has become a vital resource for conservation and education organizations large and small, including the Los Angeles and Chicago school systems, the Air Force and child care centers across America. Through 58 projects in 7 Latin American countries, Rain Forest Rescue is helping people improve their livelihoods and the stewardship of the land. And, back at home, members and key research partners are helping to improve hybrid hazelnuts at Arbor Day Farm, contributing to a healthier and more sustainable future. These are just a few examples of how we work with our members, supporters and partners to turn worthy ideals into action. Thank you for all that you do.

Best Regards,

John Rosenow Chief Executive


Board of Trustees

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Dear members and friends, At the Arbor Day Foundation, we are fortunate to build high-impact and sustainable programs even in tough economic times. While 2010 was in many ways a year of milestones for the Foundation, surpassing one million members and planting 20 million trees in National Forests in 20 years, 2011 was more about building on that positive momentum and impact. For example, participation in Tree Campus USA, which is made possible due to the generous support of Toyota, grew from just 74 campuses to 116, demonstrating increased environmental stewardship in America’s colleges and universities. We also saw considerable momentum to the Tree Line USA program, with 121 million households now served by utility companies that are committed to proper tree management and care. More children than ever experience meaningful connections with nature in Certified Nature Explore Classrooms. And the generosity of members and corporate partners continues to further the positive impact of replanting trees in our nation’s forests...now approaching some 30 million trees to date. We are grateful for the momentum we have to keep making a difference, despite a challenging economic environment. We’re especially grateful that the momentum is a direct result of loyal members and supporters all sharing in this important work.

Sincerely,

Bill Kruidenier, Chair Board of Trustees

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Members and partners plant millions of trees to restore damaged forests and enrich America’s communities and countrysides.

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he Arbor Day Foundation’s more than one million members are pivotal to our shared mission of planting trees. Members plant trees in their neighborhoods and backyards, resulting in cleaner air, better stormwater management and energysaving shade for homes and businesses. They plant trees on their farms and ranches, protecting soil and water resources and creating new habitat for wildlife. Foundation members and corporate partners such as Enterprise Rent-A-Car, AT&T and Disney also fill an urgent need by helping to replant millions of trees in our nation’s forests. America’s forests are a treasured legacy threatened by insects, disease and devastating wildfires. But Foundation members, corporate partners and supporters continue to respond. This year alone, the Foundation has replanted 4.8 million trees through our partnerships with the U.S. Forest Service and the National Association of State Foresters, with farreaching impact through the country.

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For example, members and supporters helped plant more than one million Jack pine trees to improve habitat for the endangered Kirtland’s warbler in Michigan’s Pere Marquette State Forest. Kirtland’s warblers are migratory songbirds that have become almost exclusively confined to Jack pine habitat in fourteen Michigan counties during the spring and summer. With the replanting of Jack pine trees, the population of singing males grew from less than 200 to 1,300, bringing them back from the brink of extinction. In Mississippi’s Smith County, the Arbor Day Foundation worked with corporate partners on replanting more than 160 acres of forests that had been damaged by Hurricane Katrina and the storm’s subsequent beetle onslaught. The Smith County forester’s goal of planting 600 longleaf pine trees per acre was easily met, with more than 100,000 of the native trees ultimately planted to help heal the fragile ecosystem in the wake of Katrina.


Quick Facts Q This year, members received 8,125,329 trees for planting in their yards, acreages and neighborhoods. Q 4,822,649 trees were planted in our nation’s forests. Q 217,849 Gift Trees were distributed to members and customers. Q Trees were provided to 35,667 visitors at Arbor Day Farm’s Tree Adventure to plant at their homes and in their communities.

Tree-planting crews plant trees in dozens of Foundation forest restoration projects each year.

The Foundation also initiated replanting in response to the Pike National Forest’s Hayman Fire, which burned approximately 137,000 acres in what became the largest fire in Colorado history. In some areas, 100 percent of the trees were lost. Arbor Day Foundation worked with the U.S. Forest Service to plant more than 140,000 ponderosa pine and Douglasfir trees, helping to bring back life-giving habitat and protect water resources for cities and towns throughout Colorado. Wildfire at Plumas National Forest in California also caught the Foundation’s attention. In 2007, a series of lightning strikes triggered the burning of nearly 23,000 acres in two weeks. Last year, the Foundation and partners began planting 600,000 trees, including Douglasfir trees, red and white firs, incense cedars and several varieties of pine. The new trees are already mitigating the soil and soot runoff that was damaging Plumas’ water resources, which provide fresh water to Californians living both nearby and thousands of miles away.

A young couple plants a tree in front of their home to add beauty, clean the air, control stormwater and provide energy-saving shade.

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More than 3,400 communities reap the benefits of strong and sustainable urban forestry programs.

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ith the support of our members, the Tree City USA program has strengthened and sustained urban forests in more than 3,400 communities. From the Hawaiian islands to the tip of Maine, more than 140 million Americans are living in towns and cities that pay particular attention to tree planting, care and management. As a result, these communities enjoy energy savings for homeowners and businesses, lower levels of pollution and a new sense of community pride. Communities participating in Tree City USA range from New York City, population 8 million, to New Harmony, Indiana, population 866. In New York, trees are central to PlaNYC, a blueprint for how the city can grow sustainably and enhance quality of life, while continuing to accommodate new residents. The plan outlines aggressive targets for tree planting throughout the

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city, with a $391 million budget and staffing levels sufficient for achieving the ambitious vision. Target numbers include 800 new “greenstreets” and the replanting of 2,000 acres of parkland. City officials also launched a program called Million Trees NYC to track the initiative’s progress. On the program’s website, New Yorkers are encouraged to volunteer to plant trees, make a donation, or adopt a tree themselves. So far, 527,315 trees have been planted, with more on the way. The additional trees are helping New York City achieve its goal of having the cleanest air quality of any big city in the United States. In New Harmony, Indiana, the scale may be smaller and surroundings quieter, but trees are just as central to community goals. Located on the Wabash River in southern Indiana, the town served as inspiration for the naming of the “New Harmony” tree, a disease-tolerant


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The Arbor Day Foundation recognized 148 utility companies last year with the Tree Line USA designation Understanding that trees and utility lines can work together, these utilities show a commitment to practicing proper tree pruning, planting and urban forest management — and helping customers know how to plant the right trees in the right places to save energy.

variety of the historic American elm. Trees line the town’s streets, intertwining with a mix of old and new buildings primarily built from wood. According to state officials, street trees provide Indiana with more than $79 million in economic benefits every year, with individual towns receiving as much as $53,000 in energy savings, improved air quality and stormwater management. The vision and effort in New York and New Harmony are examples of how Tree City USA recognition is only the beginning of urban forestry. Tree City USA is the framework for sustained urban forestry across the country. Thanks to our members and partners, the program’s impact is broad and far-reaching. More city foresters and arborists are hired. More city budgets include worthwhile investment in trees. And, millions of people are taking pride in community improvement.

Quick Facts Q The Arbor Day Foundation’s Tree City USA program, a collaboration with the U.S. Forest Service and the National Association of State Foresters, was launched in 1976 with 42 communities in 15 states. Today, there are 3,462 Tree City USA communities with a combined population of more than 140 million people across the United States. Q In 2011, 481 communities nationwide advanced beyond the basic standards to receive Tree City USA Growth Awards, demonstrating additional improvements in local tree care.

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Quick Facts Q Collectively, Tree Campus USA campuses invested $11.9 million in campus forest management last year. Q Through the past year, the Arbor Day Foundation and Toyota have held 20 campus tree-planting events. College students, community volunteers, and professional staff planted more than 1,500 large shade trees on their campuses. Q Tree Campus USA recognition is awarded to colleges and universities that meet ďŹ ve core standards for sustainable campus forestry: a tree advisory committee, a campus tree-care plan, dedicated annual expenditures on their campus tree program, an Arbor Day observance and student service-learning projects.

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116 colleges and universities engage their students and neighbors to establish and maintain healthy community forests.

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ollege campuses are an ideal home for community forests. As students feed their intellect, prepare for careers and broaden their social networks, connecting with nature through tree planting has the potential to lay the foundation for a lifetime of environmental stewardship. Healthy trees on and around campuses provide students with a quiet space to socialize, study, or reflect. Building off the success of the decades-old Tree City USA program, the Arbor Day Foundation now recognizes campuses that practice sound tree management and care. With crucial support from Toyota, the Foundation launched Tree Campus USA in 2008. This year, 116 colleges and universities with a combined enrollment of nearly 1.5 million students received Tree Campus USA recognition. Even in its early stages, Tree Campus USA is already having a positive impact throughout the country. At Florida Gulf Coast University, tree planting has been a partnership between students

and staff from the beginning, starting with the decision to apply for recognition. Last April, student volunteers joined with staff to plant 520 trees, creating an atmosphere where trees are no longer taken for granted. The student government will also oversee the planting of hundreds of fruit trees through it newly-launched “Food Forest” project. Keishla Negron, an environmental studies major and leader in campus tree care, remarked that tree planting instilled student pride in the campus. “Seeing the excitement in their faces when they yelled ‘we love trees’ was the best,” she said. Florida Gulf Coast University is just one example where students are making a difference by planting trees. Thanks to the Tree Campus USA program, more and more students are getting a hands-on understanding about the myriad ways trees benefit their environment, improve communities and enhance quality of life.

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Thanks to Nature Explore, children make deep connections with the natural world as an intergral part of learning and living.

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hildren today are more disconnected from nature than ever, more likely to spend idle time watching television indoors than running and playing outdoors. If current trends continue, the next generation will enter adulthood facing greater health challenges, inferior social skills and a diminished spirit of conservation. The Nature Explore program, a collaboration of the Arbor Day Foundation and Dimensions Educational Research Foundation, offers a solution. Nature Explore provides educators, school administrators, landscape architects and families with research-based outdoor learning opportunities for children. The Arbor Day Foundation has certified and held workshops for Nature Explore Classrooms in elementary schools, child care centers, forest visitor facilities and other public places throughout the country. Children in Nature Explore Classrooms learn and play outdoors through experiencing the wonders of

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nature. They climb and crawl through log structures and create their own works of art with acorns and pinecones. They dig mini-gardens, plant seeds and share the delight of watching flowers bloom and vegetables grow. These well-designed outdoor spaces provide real-world evidence of the enormous benefit outdoor learning opportunities provide for children. This year, the network of Certified Nature Explore Classrooms has continued to grow in new and exciting ways. For example: t *O"UMBOUJD *PXB MPDBMDBSQFOUFSTIFMQFECVJME what became the first Certified Nature Explore Classroom located at a YMCA. The Ann W. Wickman Child Development Center incorporates many natural elements, such as sliced sections of logs for children to climb and use as outdoor furniture. The local high school’s shop class built additional materials, while members of


Quick Facts Q In 2011, design consultations were completed for 113 Nature Explore Classrooms nationwide. Q In 177 workshops, thousands of educators were inspired to help children make deeper connections with the natural world. Q In meeting or exceeding research-based principles for creating an effective outdoor learning space, 100 locations were recognized as CertiďŹ ed Nature Explore Classrooms.

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Nature Explore Workshops for educators and designers are an important resource for learning how to appropriately connect children with nature.

the Kiwanis, Jaycees and Lions Clubs volunteered their time, demonstrating that the program brings community members of all ages together. t

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*O)PVTUPO 5FYBT /BUVSF&YQMPSFDPMMBCPSBUFE with Keep Houston Beautiful, the U.S. Forest Service and the Texas Forest Service to bring outdoor learning opportunities to children affected by Hurricane Ike. Jewelâ&#x20AC;&#x2122;s Learning Center, the site of the new classroom, was the recipient of an Exchange Center Makeover award from Exchange Magazine. The center drew many of its ideas for lessons and activities directly from the experiences of other classrooms in the growing Nature Explore network.

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.BSZ,BZ*ODBOE5IF.BSZ,BZ'PVOEBUJPO committed to building a total of 13 Nature Explore Classroom by 2012, all located at domestic violence shelters. These outdoor classrooms, lauded by civic and community leaders, are places where nurturing and healing begin â&#x20AC;&#x201C; and bright examples of how planned spaces that are rich with nature can change the lives of children. One parent remarked that the classroom was an opportunity for her children to â&#x20AC;&#x153;break the cycleâ&#x20AC;? and learn in a healthy, healing environment.

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$BTQFSCBTFE-BVSJFT*OO UIFmSTUDFSUJmFE/BUVSF Explore Classroom in the state of Wyoming, was

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recertiďŹ ed for the third year in a row in 2011. Inn owner and childcare provider Laura Stadtfeld operates both a classroom and a Nature Explore Familyâ&#x20AC;&#x2122;s Club for children and their parents. Many former students are now passionate about nature, but always eager to return for further exploration at the Nature Explore Classroom. Whether experiencing a Nature Explore Classroom in an inner city or in a forested arboretum, children beneďŹ t from the daily interaction with the natural world. Research has shown that these beneďŹ ts have a lasting impact, especially when instilled at an early age and supported by caring adults. Nature Explore provides a comprehensive, ďŹ eldtested program to help educators, administrators and businesses move from plastic and asphalt play spaces to nature-rich environments. The program includes on-site design consultations with specially trained landscape architect-educator teams, workshops for educators and designers, a sourcebook for ďŹ eld-tested components to enhance outdoor learning and Nature Explore Families Club for family activities. As the network of Nature Explore Classrooms expands, the impact on children continues to grow. More children are developing meaningful connections with nature, instilling a lifelong sense of wonder and imagination. With the foundation offered by Nature Explore, these children can grow to become the next generation of tree planters and environmental stewards.


Top: Nature Explore Design Consultations result in unique Concept Plans developed for each specific location. Above: At a design workshop, landscape architects and architects learn how to create nature-filled outdoor classrooms that are changing children’s lives.

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After more than a century, Arbor Day continues to embody the vision of J. Sterling Morton.

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t the heart of our namesake is Arbor Day itself. It is a day for digging holes and planting trees, for writing stories and poetry about trees just planted, or searching for those oldest and rarest trees to care for and treasure. Arbor Day is also a day to celebrate the accomplishments of the past year and express hope for the future. The Foundation contributes to the celebration by recognizing the inspiring work of others through our Arbor Day Awards. In 2011, we again recognized some of the unassuming heroes who work hard to advance our shared mission. Anne Hallum, founder of the DeLand, Florida-based Alliance for International Reforestation (AIR), was presented with the J. Sterling Morton Award, the highest honor given by the Arbor Day Foundation. Hallum founded the Alliance in 1993 to improve the quality of life and livelihood of Guatemalans through tree-planting. Under Hallum’s direction, the Alliance has educated volunteers in 25 Guatemalan villages, each for a period of five years. The staff consists entirely of native residents and teaches proper tree-planting, sustainable farming and protection from mudslides. Hallum’s organization has added 3.7

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million trees to the region to date. San Diego Gas and Electric was the recipient of the 2011 Arbor Day Celebration Award, bestowed on the celebration that best embodies the spirit of the treeplanting holiday. On Arbor Day, employees of San Diego Gas and Electric visited classrooms to teach students how they can help their community and develop a passion for tree-planting and environmental stewardship. They also helped students at the Lilac School in Valley Center, California, replace seven sycamore trees under power lines, demonstrating that energy safety and healthy urban forests can work together. Other recipients included: t

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3BZNPOE1MBOL GPVOEFSPGUIF6DSPTT'PVOEBUJPO GPS providing quiet open space for artists and writers on a northeast Wyoming ranch.

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,FFQ*OEJBOBQPMJT#FBVUJGVMGPSFOHBHJOHWPMVOUFFST in planting thousands of trees along Interstate 70, in partnership with Eli Lilly and Company.

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5IF/FX+FSTFZ5SFF'PVOEBUJPOGPSJUTDPNNJUNFOU to positive outcomes in struggling neighborhoods through tree-planting.

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"OE 8ZOEIBN8PSMEXJEFSFDFJWFEUIF1SPNJTFUPUIF Earth Award for its partnership with the Arbor Day Foundation on special projects, particularly its support of the Rain Forest Rescue program by purchasing 200,000 pounds of Arbor Day shade-grown coffee.

These efforts give life to Arbor Day founder J. Sterling Morton’s own words from years ago: “The cultivation of flowers and trees is the cultivation of the good, the beautiful, and the ennobling in man, and for one, wish it to become universal.”

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Alabama Last full week in February Alaska Third Monday in May Arizona Third Friday in March Arkansas Third Monday in March California March 7-14 Colorado Third Friday in April Connecticut Last Friday in April Delaware Last Friday in April District of Columbia Last Friday in April Florida Third Friday in January Georgia Third Friday in February Hawaii First Friday in November Idaho Last Friday in April Illinois Last Friday in April Indiana Last Friday in April Iowa Last Friday in April Kansas Last Friday in April Kentucky First Friday in April Louisiana Third Friday in January Maine Third full week in May Maryland First Wednesday in April Massachusetts Last Friday in April Michigan Last Friday in April Minnesota Last Friday in April Mississippi Second Friday in February Missouri First Friday in April

Montana Last Friday in April Nebraska Last Friday in April Nevada Last Friday in April New Hampshire Last Friday in April New Jersey Last Friday in April New Mexico Second Friday in March New York Last Friday in April North Carolina First Friday following March 15 North Dakota First Friday in May Ohio Last Friday in April Oklahoma Last full week in March Oregon First full week in April Pennsylvania Last Friday in April Rhode Island Last Friday in April South Carolina First Friday in December South Dakota Last Friday in April Tennessee First Friday in March Texas Last Friday in April Utah Last Friday in April Vermont First Friday in May Virginia Last Friday in April Washington Second Wednesday in April West Virginia Second Friday in April Wisconsin Last Friday in April Wyoming Last Monday in April

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Through Rain Forest Rescue, communities and families are being helped to help themselves while preserving rain forests.

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ropical Storm Agatha hit Central America hard. Though weak in force, the 2010 tropical cyclone resulted in massive flooding in Guatemala and neighboring countries, taking a catastrophic toll on both the people and the land. Without a large-scale tree recovery program, hundreds of thousands of people were at further risk of personal or property damage due to mudslides. Though exacerbated by the storm, many of these environmental challenges stemmed from centuries of disregard for the land, particularly due to logging and mass agriculture. Overcoming logistical and geographical challenges, the Arbor Day Foundation worked with the Nature Conservancy and on-site partner Vivamos Mejor, an organization aimed at improved living conditions in Latin America, on large-scale tree planting and recovery. Due in large part to the generous support of Arbor Day Foundation members, Vivamos Mejor

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planted more than one million trees and stabilized the slopes around Guatemala’s beautiful Lake Atitlan. Throughout its efforts, Vivamos Mejor coordinates closely with local villagers, building broad support and an understanding of the link between healthy forests and healthy communities. Nearly 1,800 men and women in 20 communities participated in planting trees after Tropical Storm Agatha. Many now operate their own tree nurseries and will be able to continue conserving and taking care of the land for years to come. The Rain Forest Rescue program is also advanced through the Arbor Day Foundation’s shade-grown specialty coffee. The coffee program fits perfectly with the Foundation’s goal of empowering local residents to make their own lives more sustainable, while improving their economic opportunity. The farm families growing Arbor Day Specialty Coffee earn an


Quick Facts Q Rain forests cover about 2 percent of the planet’s surface and yet are home to half of the earth’s plant and animal species. Q Rain Forest Rescue preservation work has included 58 projects in 7 countries. Q Seventy percent of the plants identified by the National Cancer Institute as useful in the treatment of cancer are found in rain forests.

above average wage and are better able to pay for school and health care for their families. Preserving rain forests, rather than mass-producing coffee beans under direct sunlight, preserves critical habitat for plants, birds and mammals in Central and South America, on top of the numerous direct benefits for people. A study released last year in the journal “Forest and Ecology Management” confirmed what Arbor Day Foundation partners and supporters have already seen up-close: community-managed forests have a better chance of survival than areas that are simply closed off and protected. This philosophy of self-empowerment will continue to guide the Rain Forest Rescue program. Thanks to Rain Forest Rescue donors and the cooperation of Arbor Day Foundation’s partners, the residents of Latin America’s rain forests are receiving help to protect their ancestral forests while assuring a better future for themselves and their children.

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Quick Facts Q According to the U.S. Forest Service, 50 million shade trees planted in strategic, energy-saving locations could eliminate the need for seven 100-megawatt power plants. Q A total of 104,000 Foundation members were engaged this year in the Hazelnut Project. Q Trees improve water quality by reducing stormwater runoff and erosion, and removing harmful chemicals from the soil – preventing them from running into streams and rivers.

Through education and communication, Americans learn how trees save energy, reduce soil erosion and clean our waterways and air.

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ublic servants in the U.S. Forest Service perform the herculean task of managing and protecting America’s precious national forests, reminding us that land conservation is ultimately about people rather than programs. To that end, the Arbor Day Foundation’s Conservation Trees initiative stresses personal responsibility for environmental stewardship, reminding farmers, ranchers and landowners that private property and conservation can go hand-inhand. As writer Henry David Thoreau put it, “What is the good of having a nice house without a decent planet to put it on?”

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Lied Lodge & Conference Center overlooks the Hazelnut Research Field at Arbor Day Farm.


Raymond Plank, founder of the Ucross Foundation, understands this. He has planted more than 15,000 trees and shrubs at his northeast Wyoming ranch, allowing for native wildlife like the mule deer and antelope to return. Other farmers and ranchers are embracing the Conservation Trees program, too. They plant trees along rivers and streams as riparian buffers, preventing soil erosion and keeping water supplies clean, or plant windbreaks alongside cropland to prevent wind damage from similarly eroding soil and depleting moisture. In both cases, they are relying on conservation bestpractices to care for our abundant earth for their benefit and the benefit of future generations. The Arbor Day Foundation is also furthering conservation through the Hazelnut Project. The Foundation and its Hybrid Hazelnut Consortium partners – Rutgers University, Oregon State University and the University of Nebraska – are developing blight-resistant hybrid hazelnuts with the ability to thrive and grow in a variety of soils and climates. These flood and drought-resistant crops absorb carbon dioxide, helping to mitigate the adverse impacts of climate changes. Beginning next fall, improved next-generation hybrid seedlings that represent the research efforts by Foundation members and Consortium partners will begin growing at the Arbor Day Farm – and reach members’ backyards soon thereafter.

An Arbor Day Foundation member looking after his hazelnut bushes.

The benefits of hazels as a perennial woody crop are profound. Deep roots anchor nutrient-rich topsoil. The leafy bushes are ideal for absorbing carbon dioxide through much of the year while the wood and root systems naturally sequester the carbon. The plants are drought and flood resistant to withstand climate changes. And protein-rich nuts provide a healthy source of nutrition for our expanding population. One day, they could help feed hungry nations. Enthusiastically participating in the Hybrid Hazelnut Project is an example of how Foundation members and partners share an affluence of the spirit in conserving our natural resources. "SCPS%BZ'PVOEBUJPOt"OOVBM3FQPSU

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Visitors from around the world experience conservation principles and the wonders of nature at Arbor Day Farm.

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uilding programs that are high-impact – lifechanging, large-scale, partner-engaging and sustainable – begins at Arbor Day Farm. The 260-acre National Historic Landmark is part of the original estate of Arbor Day founder J. Sterling Morton. It is where the Arbor Day Foundation’s mission truly comes to life. Arbor Day Farm offers the opportunity for all ages to connect with nature and broaden their imaginations. The first public Nature Explore Classroom, a partnership between the Arbor Day Foundation and Dimensions Educational Research Foundation, offers research-based learning opportunities for children in the outdoors, while attracting educators and design professionals from around the world for inspiration. Tree Adventure’s interpretative trails and exhibits are also a highlight for visiting children and families. Arbor Day Farm offers guided tours of its vineyards, greenhouses and historic walking orchards, as well as tours specially designed for children, adults and teachers.

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At Lied Lodge & Conference Center, sustainability and conservation are built into every visitor’s experience. It ranges from the basics – easy-touse recycling bins and a linen and towel re-use program that saves thousands of gallons of water and detergent annually – to high-impact practices such as sustainable food and energy conservation. In the Lied Lodge Dining Room, entrees are prepared using the freshest ingredients possible, often straight from the fields and orchards of Arbor Day Farm. And, Lied Lodge staff sources locally from Nebraska family farmers and ranchers, bringing both environmental and economic benefits to the region. Conservation organizations seeking a change in pace and scenery for key meetings are invariably drawn to Lied Lodge. The World Forum Foundation’s Nature Action Collaborative for Children attracted 70 teams from 32 nations last year to plan for connecting children to the outdoors. The U.S. Forest Service met to discuss fire, insect and water protection issues where federal, state and private lands overlap. The


Quick Facts Q Nearly 250,000 people from six continents visited Arbor Day Farm this year, where they witnessed conservation in practice at every turn. Natural Resources Conservation Service, The Nature Conservancy, urban foresters and outdoor educators also use Lied Lodge. Cormac Flynn, the state policy and program planning vice president for the League of Conservation Voters Education Fund, called his group’s meeting at Lied Lodge a “tremendous triumph” adding: “We were so happy to be able to enjoy the kind of atmosphere we are trying to protect.” The ultimate worldwide impact of the people who meet here is clean air and clean water, the conservation of resources and wildlife, sustainable forestry and community improvement, and a renewed commitment to inspire future generations of environmental stewards. Family and friends, too, connect at Arbor Day Farm – for reunions, weddings, vacations, and weekend getaways. Experiences at Lied Lodge include spa services and indoor Olympic-pool swimming. The Tree Adventure attraction, walking trails and guided tours of Arbor Day Farm’s orchards, vineyards and greenhouses help guests have fun and leave rejuvenated.

Q Visitors who touch, see, taste and learn the value of nature transfer those practices into their personal lives – including the 35,667 who carried trees home from the greenhouse to plant, nurture and celebrate.

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FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2011 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED JUNE 30, 2010 STATEMENT OF FINANCIAL POSITION June 30, 2010 With Comparative Totals as of June 30, 2010

INDEPENDENT AUDITORSâ&#x20AC;&#x2122; REPORT To the Board of Trustees Arbor Day Foundation Lincoln, Nebraska

   

     

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      ?   @   #    Comptroller General of the United States. Those standards require that we plan             +  

 statements are free of material misstatement. An audit includes examining, on    #             

 statements. An audit also includes assessing the accounting principles used          #+   

     .        reasonable basis for our opinion. K    # 

        #     # 

        !"# %"&&#          * +      in conformity with accounting principles generally accepted in the United States of America. Micek & Crouch, P.C. Lincoln, Nebraska September 26, 2011

ASSETS Current Assets: Cash and cash equivalents Investments Accounts receivable Grants receivable Prepaid expense Inventory Total current assets

2011 $

Property and Equipment Other Assets: Endowment fund Construction in progress Other assets Total other assets Total assets

14,203,550 9,420,553 3,592,675 2,067,378 8,178,880 1,209,861 1,021,283 39,694,180 155,308 39,849,488

Current Liabilities: Accounts payable and accrued expenses Current portion of notes payable Current portion of capital lease obligations Deferred revenue Total current liabilities

Temporarily Restricted (3,130 ) (3,130) (155,308) (158,438)

1,688,039 2,675,439 498,605 3,382,069 14,278,373 11,224,442 675,105 920,773 2,479,714 1,316,634 39,139,193 710,295 24,638,805 $ 25,349,100

169,734 415,432 47,998 633,164

141,587 2,379,204 53,409 2,574,200 34,723,215

$

3,883,601 300,490 6,210 2,082,045 6,272,346

$

5,049,278 286,898 6,210 2,683,670 8,026,056

(158,438) 249,916 91,478

$

2011 Permanently Restricted $

2,100 8,220 10,320 10,320

-

$

23,654,183

$

Long-Term Debt, Net of Current Portion: Notes Payable Capital lease obligations Total long-term debt

Total liabilities and net assets

$

25,814,674

LIABILITIES AND NET ASSETS

STATEMENT OF ACTIVITY For the Year Ended June 30, 2011 With Comparative Totals for the Year Ended June 30, 2010

$

4,378,369 1,011,545 1,460,629 301,411 404,947 937,931 8,494,832

33,275,244

Net Assets: Unrestricted: Designated for endowment purposes Undesignated Temporarily restricted Permanently restricted Total net assets

Revenues: Membership dues Contributions Trees for America Program grant income Arbor Day Farm income Arbor Day Coffee income Other income (loss) Total revenues Net assets released from restrictions Total revenues and net assets released Expenses: Program services: Tree City USA Arbor Day/Youth Education Conservation Trees Rain Forest Rescue Trees for America Arbor Day Farm Conference programs Supporting activities: General and administrative Membership development Fundraising Total expenses Change in net assets Net Assets at Beginning of Year Net Assets at End of Year

$

$

Other Liabilities: Annuities payable Total liabilities

Unrestricted

2,847,337 1,204,340 1,113,670 489,007 337,472 835,580 6,827,406

2010

$

735,987 4,353 740,340

1,059,664 9,884 1,069,548

766,918 7,779,604

694,148 9,789,752

1,640,629 23,708,471 91,478 55,062 25,495,640

1,383,339 23,255,466 249,916 44,742 24,933,463

33,275,244

$

2010 Total

Total $

34,723,215

14,203,550 9,422,653 3,592,675 2,067,378 8,178,880 1,209,861 1,026,373 39,701,370 39,701,370

$

13,516,849 10,419,555 3,624,080 1,204,062 7,673,306 881,017 894,974 38,213,843 38,213,843

-

1,688,039 2,675,439 498,605 3,382,069 14,278,373 11,224,442 675,105

1,567,842 2,720,769 536,178 2,617,317 14,420,395 11,015,674 475,593

10,320 44,742 55,062

920,773 2,479,714 1,316,634 39,139,193 562,177 24,933,463 25,495,640

862,445 2,460,996 1,291,107 37,968,316 245,527 24,687,936 24,933,463

$

$

7KHDFFRPSDQ\LQJQRWHVDUHDQLQWHJUDOSDUWRIWKHVHĂ&#x20AC;QDQFLDOVWDWHPHQWV

24

"SCPS%BZ'PVOEBUJPOt"OOVBM3FQPSU


STATEMENT OF CASH FLOWS For the Year Ended June 30, 2011 With Comparative Totals For the Year Ended June 30, 2010 2011 Cash Flows From Operating Activities: Change in net assets Adjustments to reconcile to net cash provided by operating activities: Contributions and grants restricted for long-term purposes Depreciation         Z          (Gain) on sale of property and equipment (Increase) in restricted cash for endowment fund (Increase) decrease in receivables (Increase) decrease in prepaid expense Decrease in inventory Decrease in charitable trusts receivable Increase (decrease) in accounts payable and accrued expenses for operating activities (Decrease) increase in deferred revenue Increase in annuities payable

$

   Z  * +     

2010

562,177

$ 245,527

1,465,294 z  `%#%"^  (28,147 ) 161,644 67,475 102,351 3,130

(72,535) 1,342,270 !#&_% ^#&![ (6,383) (15,878) (48,024) (162,916) 166,487 76

(1,165,677) (601,625) 72,770

242,551 364,537 86,292

681,597

Cash Flows From Investing Activities: Purchase of investments Proceeds from sale of property and equipment Capital expenditures for property and equipment

(1,662,013 )

(1,468,887)

   Z  * +     

&#[\]#"&!

&#^_]#^"`

Cash Flow From Financing Activities:  j     

 Payments toward debt retirement Proceeds from contributions and grants restricted for capital expenditures    Z  * + 

   Net increase (decrease) in cash Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents at End of Year

(235,000 ) -

z (315,616 )

&&&#\%% (354,175)

!&^#_&_ (1,531,032)

72,535 &_\#]&[ 402,806

4,378,369

3,975,563

$ 2,847,337

$ 4,378,369

Supplemental Disclosures: Cash Paid During the Year for: Interest

2,140,028

(105,000) 6,383

$

74,627

$

104,293

STATEMENT OF FUNCTIONAL EXPENSES For the Year Ended June 30, 2011 With Comparative Totals For the Year Ended June 30, 2010 Program Services Arbor Day/ Youth Education

Tree City USA Items of Expense: Salaries, payroll taxes and      Contract labor Advertising and promotion Printing, publications, mailing and photography Travel and meetings Professional services

$

Rain Forest Rescue

Conservation Trees

Trees for America

Support Activities Total Program Services

Conference Programs

Arbor Day Farm

General and Administrative

Membership Development

Fund Raising

Total Year Ended June 30, 2011

Total Year Ended June 30, 2010

659,802 $ 11,831,775 $ 11,864,619 235,926 186 294,612 505,131 12,112 741,214

626,462 $ 1,877 13,746

747,932 $ 1,214 17,565

166,004 $ -

193,539 56,904 241,441

626,358 69,525 450,894

173,299 2,611 8,145

1,124,180 6,028 17,682

3,347,149 72,719 203,527

143,123 86,618 50,642

33,124 203,503 17,503

5,640,772 497,908 989,834

62,832 12,402 16,337

1,327,418 1,558 16,721

267,846 18,656 42,256

7,298,868 530,524 1,065,148

7,001,838 307,798 1,153,326

14,456 4,334 576 12,096

1,896 8,562 19 12,293

1,371 1,413

1,545 1,413

264 13,269 585 97,496

16,694 21,711 297,387 320,316

2,621 2,871 1,413

33,310 53,413 301,438 446,440

42,987 5,140 32,111 7,067

2,741 7,425

364 4,970 2,993 7,067

76,661 66,264 336,542 467,999

20,178 269,231 49,995 309,614 357,788

54,170

29,344

8,500

57,730

4,188,145

-

-

4,337,889

-

169

59,763

4,397,821

5,321,418

Rain forest preservation Inventory purchases Computer services Bank charges Insurance Telephone and utilities

210,593 8,519 4,664 16,666

59,315 34,373 8,137 13,854

2,382 666 1,744

83,478 1,293,023 4,797 273 666 2,465

140,833 193,236 217,327 44,645 125,122

1,706,828 49,260 175,443 140,647 557,103

7,447 136 666 2,561

83,478 3,410,592 300,014 393,179 200,091 719,515

7,147 273 3,332 8,722

3,224 4,765 3,332 8,722

2,389 3,332 13,197

83,478 3,413,816 314,315 393,452 210,087 750,156

125,598 2,209,806 284,146 395,743 191,392 718,341

Postage =   Operating supplies Dues and subscriptions Interest expense Bad debts

158,788 1,921 10,194 300 -

395,325 882 1,297 452 -

105,458 279 -

555,572 216 56 584 -

1,879,357 11,390 25,688 2,231 55,737 -

79,405 15,818 532,503 12,238 15,617 707

8,444 545 3,208 300 -

3,182,349 31,051 572,946 16,105 71,354 707

4,510 1,045 16,415 6,371 2,910 -

644,798 577 7 -

169,083 644 1,385 922 -

4,000,740 33,317 590,753 23,398 74,264 707

3,824,219 33,791 689,298 27,941 98,255 191

144,511 27,202 5,811 18,678

19,908 3,455 946 2,424

14,931 49,947 946 1,952

134,380 127,351 75,630 43,298

932,575 5,287 111,210 72,260

29,862 45 26,584 2,138

1,315,983 218,648 223,578 149,915

74,656 4,856 2,837 4,858

39,816 56,552 946 970

34,839 11,430 946 2,452

1,465,294 291,486 228,307 158,195

1,345,434 296,934 200,053 130,312

Occupancy Recognition material Professional development Taxes Repairs and maintenance Tree purchases and shipping expenses



      Delivery expense Rental expense Miscellaneous

39,816 5,361 2,451 9,165

$

Total for year ended June 30, 2010

$

1,688,039

Total for year ended June 30, 2009

$

1,567,842 $

$ 2,675,439

2,720,769

155,160 $ 9,425

2,630,381 $ 221,945 426,668

5,587,463 $ 69,229 224,358

332,134 $ 10,245,536 $ 294,265 691,762

592,988 $ 161 10,816

333,449 $ 26,524

$

498,605

$ 3,382,069 $ 14,278,373 $ 11,224,442 $

675,105 $ 34,422,072 $

920,773

$ 2,479,714 $

1,316,634 $ 39,139,193

$

536,178

$ 2,617,317 $ 14,420,395 $ 11,015,674 $

475,593 $ 33,353,768 $

862,445

$ 2,460,996 $

1,291,107

$ 37,968,316

"SCPS%BZ'PVOEBUJPOt"OOVBM3FQPSU

25


NOTES TO FINANCIAL STATEMENTS

Note 2 â&#x20AC;&#x201C;

Z &}

Investments are charitable gift annuities consisting of mutual funds. The investment    #         #        period in which the investments are received. The fair value of these investments as of June 30, 2011 and 2010, was as follows:

FOR THE YEARS ENDED JUNE 30, 2011 AND 2010 @ @    

 j 

|

;    +       Z~Z         September 3, 1971. The purpose of the Foundation is to engage in educational and charitable       

       Â&#x20AC;      # #    Â&#x20AC;  +  z+      

     Â&#x20AC; 

           Â&#x20AC;      Arbor Day Farm, the estate of Arbor Dayâ&#x20AC;&#x2122;s founder J. Sterling Morton. Â   

 };

            

 .;    

  

  +      +     

      . Basis of Presentation â&#x20AC;&#x201C; Financial statement presentation follows the recommendations of the Financial Accounting Standards Board in its Statement of Financial Accounting Standards @@Z .&&]# 

@    Z z zj  =  .Â&#x201A; @@Z .&&]#     >          

      according to three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets. j   ? }Â&#x201A;              period received and as assets, decrease of liabilities, or expenses depending on the form of the     .         +    +

 they depend are substantially met. Restricted and Unrestricted Revenue and Support â&#x20AC;&#x201C; Donor restricted support is reported as an increase in temporarily or permanently restricted net assets, depending on the nature of the restriction. When a restriction expires (that is, when a stipulated time restriction ends or purpose  

 

      

        

   assets and reported in the Statement of Activity as net assets released from restrictions.

Charitable Gift Annuities

Note 3 â&#x20AC;&#x201C;

Investments â&#x20AC;&#x201C; Investments in marketable securities with readily determinable fair values and                      

   .Â&#x201A;               .K   income and gains restricted by a donor are reported as increases in unrestricted net assets if the restrictions are met (either by passage of time or by use) in the reporting period in which the

      . Accounts Receivable â&#x20AC;&#x201C; The Foundationâ&#x20AC;&#x2122;s management closely monitors outstanding accounts receivable and charges off to expense any balances that are determined to be uncollectible. At June 30, 2011 and 2010, the Foundation considered all remaining accounts receivable to be fully collectible. K }K        +    ~       z # z   method. j  #Â&#x201E;>   

 }j   >   >       +        '  .     #       # 

      +   .

     >       over the estimated useful lives of the respective assets on a straight-line basis. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed   

 #           @         .;                 Â&#x20AC;     +       . Accrued Vacation Liability â&#x20AC;&#x201C; Accumulated unpaid vacation pay is accrued in the Foundationâ&#x20AC;&#x2122;s 

   . !"#%"&& %"&"#       Â&#x192;`&^#`[&  $400,156, respectively. Advertising â&#x20AC;&#x201C; Advertising costs are charged to expense as incurred. For the years ended June 30, 2011 and 2010, the Foundationâ&#x20AC;&#x2122;s advertising costs totaled $741,214 and $505,131, respectively. Donated Assets â&#x20AC;&#x201C; Donated marketable securities and other noncash donations are recorded as contributions at their estimated fair values at the date of donation. Â&#x201E;  };  

       + 

  

 generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

2011 $ 1,204,340

2010 $ 1,011,545

Property and Equipment:

Property and equipment as of June 30, 2011 and 2010, consisted of the following:

Land Buildings Leasehold improvements Farm improvements Orchards Computer hardware Lied Lodge and Conference Center equipment Furniture and equipment Computer software Traveling exhibit

2010 $ 1,419,126 27,349,933 125,082 1,464,538 103,074 1,383,386

15-50 years 20 years 5-31 years 20 years 5 years

2,844,103 2,583,096 2,905,127 844,724

2,844,103 2,537,112 1,831,797 844,724

5-10 years 5-8 years 5-10 years 10 years

42,135,382

39,902,875

16,320,708

16,248,692

$ 25,814,674

$ 23,654,183

Less--Accumulated depreciation Total property and equipment

Estimated Life

2011 $ 1,419,126 27,826,950 125,082 1,466,234 114,762 2,006,178

Total cost

Cash Equivalents â&#x20AC;&#x201C; Cash equivalents consist of investments with original maturities of 60 days .           +       _" 

     . Risk Concentration â&#x20AC;&#x201C; As of June 30, 2011 and 2010, the Foundationâ&#x20AC;&#x2122;s cash and investment balances at particular institutions exceeded federally insured limits by $2,840,568 and Â&#x192;`#&\"#""%# . !"#%"&& %"&"#  +    +  federal agency bonds.

Investments:

Depreciation expense for the years ended June 30, 2011 and 2010, was $1,465,292 and $1,342,270, respectively.

Note 4 â&#x20AC;&#x201C;

Other Assets:

Other assets as of June 30, 2011 and 2010, consisted of the following: 2011 Contributions receivable from charitable trusts (Note 5) Equity in cooperative

$ $

47,998 47,998

2010 $ $

51,128 2,281 53,409

Note 5 â&#x20AC;&#x201C; Split-Interest Agreements: The Foundation has entered into irrevocable agreements with donors whereby in exchange for the gift from the donor the Foundation is obligated to provide an annuity to the donor or     

  

  . For these agreements, where the Foundation is not the trustee, the Foundation has recorded             +

  

 interest in the agreements.   !"#%"&& %"&"#  z               +| 2011 Assets included in property and equipment where the Foundation is trustee

$

120,000

Contributions receivable from charitable trusts

47,998

K         value of split-interest agreements

(3,130)

2010 $

120,000 51,128 (76)

Note 6 â&#x20AC;&#x201C; Deferred Revenue:

Functional Allocation of Expenses â&#x20AC;&#x201C; The costs of providing various programs and other activities        @         @     Functional Expenses. Accordingly, certain costs have been allocated among the programs and   

  .

Deferred revenue consists of unearned program support and royalties. The Foundation will record program revenue in the future to match the future costs of providing these program services.

   

K  };

                         .@          

              + 

  

 generally accepted in the United States of America. Accordingly, such information should be    Â&#x2020; +     <

       !"#%"&"#  +

      +   .

Note 7 â&#x20AC;&#x201C;

Income Tax Status â&#x20AC;&#x201C; The Foundation is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code. However, income from certain activities not directly related to the Foundationâ&#x20AC;&#x2122;s tax-exempt purpose is subject to taxation as unrelated business income. In addition,    >             @ &]"&                  @ ^"\%. Subsequent Events â&#x20AC;&#x201C; The Foundation has evaluated subsequent events through September 26, %"&&#+

     

   +  .

26

"SCPS%BZ'PVOEBUJPOt"OOVBM3FQPSU

Revolving Credit Note Payable and Letter of Credit:

The Foundation has secured a revolving credit note agreement with Union Bank and Trust, Lincoln, Nebraska, which provides it may borrow up to $2,000,000 at the bankâ&#x20AC;&#x2122;s variable interest rate. The revolving credit note is supported by an agreement which provides for certain restrictive covenants which includes limitations on disposal of certain property and assets and maintenance of certain ratios. The note is secured by certain real property, all accounts, notes, pledges and bequests, receivables, rights to payment, inventory, machinery  >  #  '      .    +  on the revolving credit note as of June 30, 2011 and 2010, were $-0- and $-0-, respectively. The revolving credit note expires January 31, 2012, and is renewable at the bankâ&#x20AC;&#x2122;s discretion. In addition, the Foundation has established an irrevocable letter of credit of $1,200,000, for securing payment drawn in favor of a USDA Forest Service agreement. The letter of credit expires December 31, 2011, and is renewable annually. The fee for the letter of credit is waived. There was no outstanding balance under the letter of credit as of June 30, 2011.


Note 8 â&#x20AC;&#x201C; Long-Term Debt:

Note 10 â&#x20AC;&#x201C; Designated and Restricted Net Assets:

Long-term debt as of June 30, 2011 and 2010, consisted of the following:

The Board of Trustees has designated unrestricted net assets as follows:

2011 Note payable to Union Bank and Trust, Lincoln, Nebraska, with 5.95 percent interest. Secured by real estate in Lincoln, Nebraska. Payable in monthly installments of $20,267 with the balance of principal due on April 4, 2013.

2010

2011 Contributions designated for endowment

$

1,497,578

$

1,640,629

Other endowment purposes $

Note payable to Microsoft Corporation with an imputed interest rate of 6.0 percent. Secured by computer software. Payable in monthly installments of $6,045, maturing on March 20, 2012.

745,637

$ 936,417

53,066

120,215

2010 $

1,261,073

143,051

122,266 $

1,383,339

Temporarily restricted net assets as of June 30, 2011 and 2010, are available for the following purposes: 2010

Note payable to Farmers Bank, Nebraska City, Nebraska, with 7.25 percent interest. Secured by real estate in Nebraska City, Nebraska. Payable in monthly installments of $2,406, maturing November 6, 2017.

147,314

Non-interest bearing note payable to the City of Lincoln for $60,000 with a discounted value of $44,000 at a stipulated interest rate of 6.5 percent. Secured by real estate in Lincoln, Nebraska. Payable in monthly installments of $500, maturing November 30, 2017.

164,658

Contribution Receivable - Charitable Trusts Â&#x2021; j Â&#x2020; Orchard Restoration Rooftop Garden

2011

$

47,998 37,593 5,887 -

$

51,128 37,593 17,575 143,620

$

91,478

$

249,916

Permanently restricted net assets as of June 30, 2011 and 2010, are available for the following purposes: 31,395

35,213 2011

Note payable to John Deere Credit, with a 6.75 percent interest rate. Rate secured by equipment in NebraskaCity, Nebraska. Payable in monthly installments of $548, maturing August 28, 2011.

$ -

Note payable to John Deere Credit, with a 6.90 percent interest rate. Secured by equipment in Nebraska City, Nebraska. Payable in annual installments of $18,561, maturing July 1, 2012.

$

44,742

1,087

During the years ended June 30, 2011 and 2010, grant income consisted of the following: 15,791

33,658 Grant Source

Grant Purpose 2011

21,000

Note payable to Arbor Bank, Nebraska City, Nebraska, with 5.75 percent interest. Secured by equipment in Nebraska City, Nebraska. Payable in monthly installments of $542, maturing on April 16, 2015.

28,000

Government: U.S. Department of Agriculture 

22,274 $

1,036,477

Less--Current portion

27,314 $

1,346,562

$

1,059,664

300,490 $

735,987

286,898

$

U.S. Department of Housing and Urban Development

300,490 572,142 53,247 33,475 32,292 44,831

Training Academy Tree City USA Public Service Ads Â&#x2021;     City Teams

$

$

134,994 255,608 79,900 -

22,462

-

Government Grant Income

800,376

470,502

Educational Programs

1,079,000

559,000

Educational Programs

120,000 26,000 42,002

156,090 18,470

1,267,002

733,560

Private Grant Income Total Grant Income

$

2010

279,909 234,445 140,000 79,904 43,656

Block Grant

Private: Toyota Foundation Home Depot Foundation Mary Kay Others

Long-term debt is scheduled to be retired as follows:

Total

55,062

Note 11 â&#x20AC;&#x201C; Program Grants:

Note payable to Downtown Civic Ventures, with a 2.15 percent interest rate. Secured by real estate in Lincoln, Nebraska. Payable in annual interest only installments of $753, maturing June 1, 2014.

Year ending June 30, 2012 Year ending June 30, 2013 Year ending June 30, 2014 Year ending June 30, 2015 Year ending June 30, 2016 Thereafter

2010

Endowment purposes

$

2,067,378

$

1,204,062

1,036,477 Note 12 â&#x20AC;&#x201C; Other Income:

Note 9 â&#x20AC;&#x201C; Capital Leases: Other income listed on the Statement of Activity is detailed as follows: ;           >     ' ing in 2013. The assets and liabilities under capital leases are recorded at the lower of the present value of the minimum lease payments or the fair value of the assets. The assets are             .        

      

 '   %"&&. Following is a summary of property held under capital leases: = Â&#x201E;>  Restaurant Equipment

$

105,272 26,767 132,039 (62,196)

Less: Accumulated depreciation $

2011 $

List rental income Education material sales Tree City USA material sales Conference and training Rental income Gain (loss) on investments Interest income Gain on sales of property and equipment Other income under $25,000 Total other income

$

2010

421,408 108,981 58,588 166,747 110,243 141,523 3,785 15,098

$

544,088 135,917 59,533 57,150 56,429 11,153 6,929 6,383 17,392

1,026,373

$

894,974

69,843

Minimum future lease payments under capital leases as of June 30, 2011, were as follows:

Note 13 â&#x20AC;&#x201C; Income Taxes:

June 30, 2012 June 30, 2013

The Foundation has a net operating loss carryforward that may be offset against future taxable income. If not used, the carryforward will expire between now and June 30, 2031. The loss carryforward at June 30, 2011, totals $16,843,645. No net operating   

      '  Â&#x20AC;  #   +  been established.

$

Net minimum lease payments Amount representing interest Present value of net minimum lease payments

6,210 4,853 11,063 (500)

$

10,563

"SCPS%BZ'PVOEBUJPOt"OOVBM3FQPSU

27


Note 14 â&#x20AC;&#x201C;

Note 18 â&#x20AC;&#x201C; Fair Value Measurements:

Leases:

The Foundation has an agreement to lease Steinhart Lodge from the City of Nebraska City for a term of 99 years commencing June 1, 1985, for the total sum of $1. The Foundation has the option to extend the agreement for an additional term of 99 years for the total sum of $1. Since the lease term extends beyond economical life of the asset, the Steinhart Lodge lease has been shown as a capital addition at a value of $297,750. Steinhart Lodge is part of Arbor Day Farm. The Foundation leases real property under two cancelable operating lease agreements. Net lease expense for the real property was $26,400 for each of the years ended June 30, 2011  %"&"# .Â&#x201A;    # Â&#x192;`%#""" *   Â&#x2020;     !&#%"\[.;       operating lease to another party under the same terms as the Foundationâ&#x20AC;&#x2122;s. Under the second agreement, lease payments are $26,400 annually through December 31, 2047. ;        >     +

'  in June 2014. Total equipment rental expense amounted to $228,307 and $200,053 for the years ended June 30, 2011 and 2010, respectively.          +   +| Year ending June 30, 2012 Year ending June 30, 2013 Year ending June 30, 2014 Year ending June 30, 2015 Year ending June 30, 2016

$

92,775 42,562 33,835 28,359 26,400

Fair values of assets measured on a recurring basis at June 30, 2011 and 2010, are as follows: Fair Value Measurements at Reporting Date Using

Fair Value June 30, 2011 Charitable Gift Annuities Contribution Receivable Charitable Trusts Total

June 30, 2010 Charitable Gift Annuities Contribution Receivable Charitable Trusts Total

Quoted Prices in Active Markets for Identical Assets (Level 1)

@     Unobservable Inputs (Level 3)

$ 1,204,340

$ 1,204,340

47,998

-

$

$ 1,252,338

$ 1,204,340

$

$ 1,011,545

$ 1,011,545

$

51,128

-

$ 1,062,673

$ 1,011,545

47,998 47,998

51,128

$

51,128

Fair values for charitable gift annuities are determined by reference to quoted market prices and other relevant information generated by market transactions. The fair value of the

          '     * +. Note 15 â&#x20AC;&#x201C;

Retirement Plan:

;              >    Section 401(k) of the Internal Revenue Code. The plan covers full-time employees age twenty-one and over with one year of service. During the years ended June 30, 2011 and 2010, the Foundation contributed up to three and six percent of gross salaries, respectively. Gross salaries exclude compensation in excess of $100,000 for purposes of determining the Foundationâ&#x20AC;&#x2122;s contribution. Employees may make contributions to the plan up to the maximum amount allowed by the Internal Revenue Code. Plan expenses were $192,344 and $346,282 for the years ended June 30, 2011 and 2010, respectively. Note 16 â&#x20AC;&#x201C;

The Foundation conducted activities which incurred joint costs for distribution of direct mail fundraising appeals and educational information, and corporate marketing activities. These costs were allocated as follows: 2011

Note 17 â&#x20AC;&#x201C;

$ 2,100,284 701,367 $ 2,801,651

2010 $ 2,388,091 630,563 $ 3,018,654

Related Party Transactions:

The Foundation and Dimensions Educational Research Foundation (Dimensions) collaborate on the creation of educational activities and programs that support the Nature Explore program. In connection therewith, for the years ended June 30, 2011 and 2010, the Foundation has paid Dimensions for research and program implementation services, $571,250 and $526,000, respectively. These are considered related party transactions as the       <  '      '       .

28

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Contribution Receivableâ&#x20AC;&#x201C;Charitable Trusts June 30, 2009 Change in value of trusts

$

June 30, 2010 Change in value of trusts

Allocation of Joint Costs:

Total joint costs allocated to program services Total joint costs allocated to fundraising

                 (Level 3):

June 30, 2011

51,204 (76) 51,128 (3,130)

$

47,998

The change in value of the split-interest agreement is attributable to the revaluation of the contribution receivable (charitable trusts) based on applicable mortality tables and current market conditions and is included in the change in temporarily restricted net assets for the year ended June 30, 2011.


Board of Trustees

Executive Management Team

Photo Credits

Bill Kruidenier Chair

John Rosenow Chief Executive

Doug Bereuter Vice-Chair and Chair-Elect

Matt Harris President

Carrie Benes Randy Barger Valerie Cuppens Ed Goodwin Furnum University Karina Helm Geoff Johnson William Lauer Luis Peon-Casanova Vivamos Mejor Amy Stouffer Mitch Wiebell Kerry Wilken

Preston Cole Mrs. Lee A. Crayton, Jr. (Carolyn) Ray Empson Don Glendenning Ed Jaenke

Britt Ehlers Vice President Human Resources Doug Farrar Vice President Arbor Day Farm Karen Houser Lied Lodge General Manager

Scott Josiah Leah MacSwords

Dan Lambe Vice President Programs

Ken Munson Woodrow Nelson Vice President Marketing Communications

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29


“The cultivation of trees is the cultivation of the good, the beautiful, and the ennobling in man.” J. Sterling Morton

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Arbor Day Foundation 2011 Annual Report