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Director oversees the legacy of the Farash family

Rochester Business Journal
March 29, 2013

On the wall behind her desk is a picture that perfectly captures the past and future for Hollis Budd.
 
In the picture, local entrepreneur and philanthropist Max Farash stands among four presidents of the University of Rochester, a group of leaders that spans decades. The picture reminds Budd, a longtime UR fundraiser and friend of Max Farash, of the important work she now does as a steward of the Farash fortune.
 
Budd was named director of the Max and Marian Farash Charitable Foundation in late 2010. She started Jan. 1, 2011, taking over after the death of Max Farash, when the foundation added close to $200 million in assets he had amassed through his real estate empire.
 
Budd, 58, has the task of leading the foundation as it uses those funds to benefit the community. She also leads the growth of an essentially new non-profit with a small but expanding staff.
 
And over her shoulder the entire time is the reason for the work-fulfilling the wishes of Max and Marian Farash.
 
"It's really all about honoring the memory of the exquisite philanthropy of a well-loved couple," Budd says.

Her path
For Budd, Rochester was only supposed to be a stopover.

She moved to the area in 1979 when her husband started a medical residency at Strong Memorial Hospital, and she did not envision staying long.
 
"I thought we would be here for three years," she says. "Now this is home and I can't imagine living anywhere else."
 
Budd has enjoyed a long, varied career at UR, with roles in everything from cancer research to the nursing school to central administration. She also became the university's first female vice president.
 
"It was fun reinventing myself in all those different roles," she says.
 
It was through her work at UR that Budd came into contact with Max Farash, first meeting him in 1988 when she moved from working in the nursing school to the Simon School of Business.
 
The Farash Foundation also was established in 1988 and, before the death of Max Farash, held assets valued at $3.5 million to $4 million. After he died his assets escalated the foundation's assets to more than $200 million.
 
Several factors made Budd the right fit as the organization's director, board members say. She had spent many of her 31 years at UR working in fundraising for the Simon School. She was also a board member of the Farash Foundation and understood the transition that would take place once the couple's assets were given to the foundation.
 
"The community board was constituted in 2007, and part of the trust that governed us said that a member of the Simon School faculty or administration had to hold a seat," Budd says. "So I represented the Simon School from 2007 to 2011, and our role was to prepare for the day when the foundation would go from a relatively small entity to a major enterprise."
 
Because the foundation was going to have a rapid transformation, the board and Chairman Nathan Robfogel opted to appoint Budd as director without going through a search process. The board decided it could not pass up the opportunity to bring her experience to the foundation on a full-time basis, Robfogel said at the time.
 
Budd was successful at UR because of her ability to build relationships, notes Daniel Meyers, president of the Al Sigl Community of Agencies.
 
"She had just about every job possible at the University of Rochester and understood that complex organizations like universities run on relationships," Meyers says. "She had sterling relationships all along the way, which is why she kept getting tapped for more jobs and bigger responsibilities."
 
It was that networking ability that also led to her transition to the Farash Foundation, Meyers notes.
 
"It was like she was in the incubator all those years, waiting to take over and unleash this great benefit on the community," Meyers says.
 
The transition also had some growing pains.
 
Terms of Max Farash's will called for control of both the foundation and his company to rest with Max and Marian's daughter, Lynn Farash, along with a favorite relative, Matthew Aroesty. A lengthy legal dispute ensued, along with criminal charges and the appointment of a guardian.
 
Last year the parties came to a final settlement, just before a state Supreme Court trial was to begin. Both Lynn Farash and Aroesty returned to the board of trustees.

The transition
Part of the transition after Max Farash's death involved preparing to go from a trustee-managed foundation to a professionally staffed organization. Budd and the others involved in the process found there was much to do.
 
"At one point we didn't even have anything like a website or logo, so doing all that was a major focus during that time frame (after Max Farash's death)," Budd says.
 
Becoming a professional organization meant adding employees. Within its first few months the foundation hired five employees, with a sixth added recently.
 
Budd says the organization is unlikely to become larger.
 
"In 2010, after Max's death we did a great deal of benchmarking nationally to compare organizations of the approximate size that the Farash Foundation was about to become," she says. "Depending on the nature of the organization, the staff would be anywhere from six to 20, but we felt as though six to eight would be the perfect size for us."
 
Another part of the foundation's growth was an overhaul of the board. It grew to 11 members and added committees for investments, grants, governance and auditing.
 
Budd took over as director as the biggest change took place. After years of grants worth $150,000 to $200,000 a year, the influx of assets allowed annual grants to grow to $7 million to $8 million.
 
Determining the grantmaking procedure took some work, but Budd says the foundation had the help of an intuitive software program that made the process transparent and user-friendly.
 
"Having this software system is not only user-friendly for potential grantees but also helps the foundation track every step of the way," Budd says. "We wanted to make that process as seamless as possible for the grantees."
 
But the process is far from an automated endeavor free from human input, Budd says.
 
"Not only do the staff read the requests, but we have a very hands-on grants committee that have brought in many industry experts in various areas to help with grant reading and scoring and awarding the grants," she says.
 
As it grew, the foundation moved into a new office on East Avenue in one of the properties owned by Farash's real estate company. It moved into what was at first an empty, unused floor and spent the first months working in a small cordoned-off area with plastic on the carpet while the rest of the floor was renovated.
 
Now the Farash Foundation has moved into a long corridor office while some still-empty space is used by a non-profit group supported by the foundation, Full Circle Home.
 
The new office space allows Budd to catch a glimpse of her other passion-movies. The building is across the street from the Little Theatre. Although she says she is a movie buff, Budd has not had much time to see one recently.
 
Aside from movies, Budd enjoys reading and golfing but puts family activities first. She has a daughter who lives in the area and is about to have her first child. Budd's father recently moved from Chicago to live with the family.

Areas of focus
The foundation's direction already was known when Budd took the reins. Grants would be directed toward the areas where the Farashes donated during their lives: education, entrepreneurship and Jewish causes.
 
There was still much work to be done to determine how funding would be given within those areas, however.
 
When Budd became director, she began working with Isobel Goldman, who came from the Jewish Federation of Greater Rochester to serve as the foundation's director of gifts. Together the two met with community members to help determine funding priorities.
 
"We had a listening tour and met with close to 100 people in the Greater Rochester community," Budd says. "We just spent our time listening to what they felt were the biggest needs of the community, and all the time we were thinking of how it could connect with the goals of the foundation in education, entrepreneurship and Jewish life."
 
The foundation is required to spend 50 percent of its grant money on Jewish causes and the other 50 percent on secular causes, and trustees picked the areas where Max and Marian Farash traditionally donated.
 
After a year of meeting with representatives from Monroe and Ontario counties, foundation officials in late 2011 decided on five funding areas: Jewish life, education, entrepreneurship, arts and culture, and human services.
 
Education was picked as the initial area of focus in the foundation's first year of full funding. For Budd, it was a perfect fit.
 
"Having been in higher education for more than two decades gave me a great perspective in that area," she says.
 
There was immediate interest from the non-profit community, Budd says. In the first year more than 150 requests were made for education funding, totaling more than $20 million.
 
There already have been some major initiatives from the foundation. In late 2011 it announced a $100,000 contest for social entrepreneurship, following Max Farash's lifelong support of innovation.
 
"We were extremely proud of that because not only does it remember Max as a very successful entrepreneur himself but also marries what Max and Marian wanted to do and his amazing vision for identifying opportunities," Budd says. "What the prize does is identify individuals for innovative approaches to society's most pressing problems."
 
The foundation also introduced the First in Family scholarship, a $3.5 million fund that allows students from Monroe and Ontario counties to attend and graduate from college free of debt.
 
"The students who received those scholarships aren't just getting money," Goldman says. "They also completed community service projects, and the nine colleges that participated worked closely with the students." 
 
Other funding areas reflected specific initiatives Max Farash supported. One is a fund that helps non-profits in need of emergency funding for items such as a broken water heater or a damaged roof that needs an expedited grant process.
 
"Being in real estate, if someone needed a repair Max was often there to help, though he didn't make a big deal about it," Budd says. "To honor that quiet giving, we established the emergency repair fund."

The future
Budd foresees a shift in the foundation's strategy.
 
The community has been waiting so long to benefit from the philanthropy of Max and Marian Farash that a transition is necessary, she says, one that will make more transformative gifts.
 
"Our goal is to become a strategic philanthropic organization," she says. "We will make fewer gifts but do them at larger levels, providing seed money for new programs and leveraging our gifts."
 
Foundation officials saw within the first year what an impact larger gifts could have, Budd says. Education was the first category to open, and the foundation intentionally did not put many parameters on funding requests.
 
"We made awards from $5,000 to $100,000, but moving forward we see that we need to be more strategic," she says. "To have a larger impact, the prevailing thought is that we need to do fewer gifts at a higher amount."
 
Though the main areas of focus will remain the same, Budd says the foundation's board and committees will be looking to the community for input on priorities within those areas.
 
Budd herself has some adjusting to do in her work with the foundation. Once a member of several non-profit boards, she resigned those positions to avoid any conflict of interest.
 
She may have been working in the same realm at UR, but her duties at the Farash Foundation have shown her a different side to philanthropy.
 
"For more than 20 years, my main responsibility at the University of Rochester was to ask people for money," Budd says. "Now people ask me what it's like to be on the other side, and it's very challenging. There are far more needs than the foundation ever will fill, and even distributing $8 million a year is not enough."

Hollis Budd
Position: Director, Max and Marian Farash Foundation
Age: 58
Education: B.S. in medical technology, Rush Medical College, Chicago, 1976
Residence: Rochester
Activities: Going to movies, golfing, reading
Family: Husband James; daughters Erin and Elizabeth
Quote: "Our goal is to become a strategic philanthropic organization. We will make fewer gifts but do them at larger levels, providing seed money for new programs and leveraging our gifts."

3/29/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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