The board was hot and heavy to liquidate back in June, but it delayed its decision after the Office of the Attorney General reminded board members that Dr. Samuell’s trust couldn’t simply be broken on their whim. After all, the one stipulation that Dr. Samuell attached to his gift was that the property was “not to be sold.”
While this is good news for those who care about donor intent, the rule of law, and the moral obligations attached to trusteeship, the board’s decision hardly resolves the matter. They simply kicked it down the road. The underlying problems remain.
It is breathtaking to recall that Dr. Samuell bequeathed his entire corpus of land to the city of Dallas in 1937 along with about $1.2 million in stock (roughly about $18 million in today’s inflation-adjusted dollars). One estimate in 2009 suggested that the value of the portfolio today should be in the neighborhood of $250 million.
Instead, the Samuell farm fund was valued last year at $5.6 million, less than the original bequest. Under prudent stewardship, Dr. Samuell’s stock bequest might have been more than sufficient to shepherd the responsible development of all of the Samuell park lands. That is not where things stand today. The city is broke and is looking to raise cash. Dallas is not alone in this.
The Samuell Farm case is telling because it is merely one of the first instances of a cash-strapped municipality trying to undo its legal and moral obligations by liquidating gifts bequeathed to it by earlier generations of citizens in order to raise cash. A floundering economy will continue to lay bare the tenuous fiscal arrangements of American municipalities, counties, and states that the go-go economy hid from the public eye. In so doing, one anticipates many more controversies akin to Dallas's Samuell Farm.
The fiscal problems facing cities, counties, and states are monumental. A study by the Pew Center on the States, for example, estimated a $1 trillion gap as of fiscal year 2008 between what states had promised workers in the way of retiree pensions, health care, and other benefits and the money they currently had to pay for it all. Cities like Dallas, one fears, may not even have a firm grasp of the relationship between their pension obligations and their ability to pay (especially if they run their pension plan like the Samuell farm fund).
Suffice it to say, there’s not a lot of extra cash in city, county, and state coffers lying around to be spent on parks.
In Sacramento, California, the financially strapped county transferred control of the majestic Effie Yeaw Nature Center and its 77-acre nature preserve to the American River Natural History Association. The county simply no longer had the funds to maintain the preserve. Giving the land over to a nonprofit that specializes in preserving such monuments may turn out to be a better way of preserving the public interest than having it under county administration. (Dallas would do well to study Sacramento’s example.)
In the coming months, the Dallas Park Board will no doubt expend more staff time and resources (reimbursed from Dr. Samuell’s trust income) figuring out how to wriggle out of its obligations as trustee. The Office of the Attorney General will use its time and resources reminding them of their legal obligations as trustee. At some point, a judge will resolve the matter. In so doing, he may be setting a precedent for other cities like Dallas whose fiscal acumen does not measure up to their historic obligations.