July 21, 2004
Update on the Humane Society of Indianapolis
On Tuesday, the Indiana Attorney General’s Office gave the Humane Society
of Indianapolis (HSI) a tentative green light for using a restricted
trust as collateral for a $1.7 million line of credit (see “Financial
Disclosure,” Dispatch, May 5-12, 2004).
The parties reached the agreement at a pre-trial conference. HSI can move
forward with their request, provided that a co-trustee, First Trust
Indiana, is immediately appointed. Upon appointment, First Trust Indiana
would be required to make a recommendation whether to use the $3.4
million Mary Crume Powell Trust as collateral, propose a repayment
schedule for the line of credit and provide amended accounting of the
Crume Trust assets.
The group Move to Act along with Alliance for Responsible Pet Ownership,
Inc., Home for Friendless Animals, Inc., Southside Animal Shelter, Inc.
and Spay-Neuter Services of Indiana, Inc. had requested standing in this
case. They argued that if HSI’s plan to use trust assets for funding
failed, other non-profit animal care organizations would be directly
In an agreement reached late on Monday, Move to Act voluntarily agreed to
withdraw their request for standing. Warren Patitz, founder of Move to
Act, said, “We withdrew as a courtesy to the courts.” He added, “We felt
it would waste the court’s time arguing [Move to Act’s] standing.” The
other groups are not withdrawing their requests.
The Attorney General’s Office filed a motion on Tuesday to dismiss the
groups’ request for standing. The motion stated that the parties “have
not alleged that they have been injured or are in imminent danger of
suffering injury,” and that “Only the attorney general may represent the
public interest in the enforcement of public charitable trusts.”
Stacey Schneider, press secretary for the attorney general, said, “Our
first priority with public charitable trust assets is to determine
whether or not and how much of trust assets could be put at risk.”
Patitz said, “If the Humane Society fails, the other groups would absorb
the fallout.” He added, “Move to Act withdrawing doesn’t affect our
argument for standing.”
The request to use the Crume trust as collateral for a line of credit
would be the second such use of a trust by HSI. Last year, HSI used the
Stokes Charitable Trust as collateral for a $700,000 credit line. That
credit line was recently increased to $900,000.
The lines of credit are part of a three-year financial recovery plan by
the Humane Society that included decreasing expenses and focused
fund-raising efforts. Six months into the plan, HSI is 3 percent under
budget on expenses and $286,000 ahead of fund-raising projections.
According to Martha Boden, executive director of the Humane Society, “Our
plan is to no longer be dependent on the lines of credit by 2006.