February 5, Oklahoma City Disaster Relief Fund Trustees Oklahoma City Community Foundation Trustees

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1 February 5, 2005 TO: FROM: RE: Oklahoma City Disaster Relief Fund Trustees Oklahoma City Community Foundation Trustees Nancy Anthony, Carla Pickrell, Anna-Faye Rose Recommendations for Disaster Relief Fund Allocations For the last two years, the Trustees of the Oklahoma City Disaster Relief Fund have discussed the long-term future of the fund. Clearly, none of the current Trustees or staff anticipated that when the fund was formed in May, 1995, that both its needs and resources would still be in existence ten years later. Planning during the initial years of the Disaster Relief Fund was oriented toward the primary purpose of the fund which was to assist the recovery of those who survived the 1995 bombing and the families of those who were killed. The expectation was this would be a 3 to 5 year effort with a number of other organizations also involved. The establishment of the Survivors Education Fund scholarship program initially defined the participation of the Community Foundation to be 20 years, the length of time necessary to administer the scholarships. Just as there was no precedent for the bombing event and the community effort required for the response, there was also no way to know how long the recovery would be for many of the injured victims and survivor families or what the eventual service needs would involve. Our involvement has extended well beyond simple administration of scholarships and distribution of victims assistance to be one of the primary resources for individuals and families for long-term case management services. The role has come by virtue of our stewardship of so many funds given to assist with the recovery, our connection with so many families through the Survivors Education Fund, and our willingness to assume the case-management responsibility when other participating organizations have concluded their involvement. Currently, only the Community Foundation and the American Red Cross are providing ongoing case-management and assistance to the general survivor group. We expect the Red Cross to wind down its involvement over the next 5 years and perhaps sooner leaving the Community Foundation as the primary community resource for services. While this is not necessarily a role that we sought or anticipated, we seemed to have inherited it. These recommendations are made based on the assumption that eventually, the Oklahoma City Disaster Relief Fund will be the sole charitable resource remaining for those impacted by the 1995 Murrah Building bombing.

2 Contributions and Income Charitable organizations in the community including the Oklahoma City Disaster Relief Fund received many more contributions than could have ever been anticipated. The high level of national visibility, the size of the victim group and the public shock over such a criminal or terrorist act generated an outpouring of charitable giving that was astounding to community leaders at that time. There were a number of charitable funds established and contributions continued to be received for up to two years after the original event. In addition to the funds received directly and those handled through the office of the Mayor of Oklahoma City, the Community Foundation eventually received all or the remaining portions of more than 20 charitable funds. More than $2 million was received after the first anniversary. The Community Foundation invested the Survivors Education Fund conservatively in zero-coupon bonds with maturities that matched the ages of those who would benefit. This investment strategy, while designed to be conservative, produced exceptional returns in a low-interest rate period. The use of the Community Fou general investment pool for other funds, with a compounded rate of return averaging more than 10 percent between 1995 and 2004, provided investment performance far in excess of money market rates. The earnings that we were able to generate exceeded our planned needs for the scholarship funds and added significant value to the total Disaster Relief Fund. The spending from the funds was coordinated with other resources in the community very effectively. The use of professional case-management for the survivor group insured that maximum insurance and compensation resources were secured for the survivor families and injured victims. Many health issues were addressed before they became a crisis and thus more costly. We controlled mental health costs by paying actual costs rather than making grants for services that might not have been used. Education costs were also coordinated. The utilization of education funds was less than anticipated and all of the scholarship funds have experienced lower per student cost than planned. No administrative expenses were charged by the Community Foundation for any overhead or administrative support services including administration of the contributions and fund management services. Other funders, anxious to spend their money and conclude their work, paid expenses earlier in the process and exhausted their funds delaying the payment of our funds until later. This allowed more investment earnings to accumulate before payments were made. It is the availability of these exceptional earnings that has created the opportunity to plan for long-term services and to address additional opportunities that will be valuable to both the community and the nation. Services Provided Although every organization that worked in the bombing aftermath defined its target population differently, the Oklahoma City Disaster Relief Fund worked primarily with the following groups: 1. Immediate families of those who were killed. Living assistance was provided to those who were economically dependent on the deceased. Counseling support was provided to all immediate relatives that requested it. 2. Individuals present in the Murrah Building or any of the buildings that sustained significant internal damage. All of those with physical injuries were included in this group. 3. Dependent children of any person who was killed or who became permanently disabled as a result of physical or mental injuries. 4. Emergency rescue personnel and first-responders who participated in the rescue effort and had PTSD or other mental problems as a result of this work.

3 The Resource Coordinating Committee (RCC),made up of funders and direct service organizations and assisted by a cooperative data base of survivors maintained by the United Way, worked for five years to insure that services were provided cooperatively and effectively. A case management system instituted by service providers made sure that every family that with a death or serious injury had a professional case worker that could assist the survivors and also advocate on their behalf at the RCC. The Disaster Relief Fund supported three case managers directly and another through grants. The Disaster Relief Fund was a primary supporter of the infrastructure of the support system, the RCC, the database and the case managers. Financial assistance was provided to individuals whose housing was damaged or who lost employment through grants to Salvation Army, Travelers Aid, and the Oklahoma City Chamber of Commerce Small Business Division. The Disaster Relief Fund paid for two years of staff support for the United Way survivor data base project and also provided financial assistance to those with uninsured property damage in the immediate vicinity of the bombing site. A number of the funds created requested that support be given to specific Memorial and to provide funding for the National Terrorism Institute. Support was also provided for memorial commemoration activities. In the initial coordinating efforts with other organizations, the Community Foundation assumed responsibility for administering scholarship funds that would benefit children of those who were killed. Because of the large number of contributions received and the need for some unique case management services for the children who would benefit, the scholarship program became the largest component of our disaster relief services. We were able to integrate most of the direct scholarship activities with our other scholarship programs and eventually assumed the administrative responsibility for two other funds that account for most of the scholarship resources. As a result of these relationships, our case management services are centered on the families with children that have or are eligible to participate in the scholarship programs. We have a number of other cases but families with children dominate. The normal progression of recovery from trauma for the survivor group was impacted by two different issues, both of which have extended the recovery time and slowed the progress for a number of people. The trials of McVeigh and Nichols, the subsequent execution of McVeigh, and the 2001 terrorist attacks on the World Trade Center and Pentagon have had significant impact on the demand for services from the target survivor group. The issues around compensation for 9/11 survivors and rescue workers also rekindled a lot of the basic anger and resentment that had been overcome. Because of its commitments to the Mayor of Oklahoma City when it assumed responsibility for funds received in that office, the Disaster Relief Fund ombing, contacts were regularly made with every family where there was a death or critical injury if that family was not receiving services from agencies involved with the RCC. Additionally, this commitment has caused us to assume cases from organizations that closed their operations and to reopen others when current events or changed circumstances created needs for the target survivor group. Because we have the only original case manager left from the original effort, the only administrative staff still in place from the original organizational meetings, and significant financial resources still available the Disaster Relief Fund has assumed the responsibility of maintaining the services to the survivor group. The case manager function was the most important factor in the ability of the Disaster Relief Fund to address the needs of survivor group in a way that allowed them to move forward and begin to restore their lives and is an essential element of our future recommendations.

4 Donor Designated Funding and Past Allocations. Contributions were received by the Community Foundation into at least twenty different funds most of which had a specific purpose or target beneficiary group. While initially some direction was provided by the fund sponsors and specific grants were made for activities such as the construction of the memorial, the Disaster Relief Fund was able to utilize most of the funds at its discretion but in keeping with the donor group preferences. In 1998, based on an assessment of immediate and long-term needs of the survivor -term medical and mental health to insure that resources would be available for expected needs. A number of funds were consolidated at that time, but the original intention of the funds was retained. The Disaster Relief Fund has maintained those basic donor intentions for all of the original contributions to the funds. The Survivors Education Fund was the first fund initiated by the Community Foundation at the request of the original coordinating committee. No other organization was able to support the administration of scholarships for the children of those who were killed and the Community Foundation assumed this role because of our scholarship experience. While the SEF received a number of individual contributions, the nd Families Fund was anxious to commit its funds within the first year and contributed $4.8 million to the SEF. This gift insured that the scholarship function was completely funded. However, scholarships for children continued to be a popular cause for other donors and significant other contributions were received. These funds are about half of the original contributions and the single largest expenditure for the Disaster Relief Fund. Commitment and Future Needs While we certainly did not plan to be in business for an extended period of time, circumstances and resources seems to have presented the Community Foundation with a responsibility that we have assumed. The original allocation in 1998 for funds beyond the immediate emergency needs identified three long-term commitments to donors and fund sponsors: 1. Education funds for all eligible for the Survivors Education Fund. 2. Long-term medical and mental health safety net for the injured survivors including both direct costs and assistance with living expenses for those with long term needs. 3. Case management support for all individuals and families in the original targeted population group. The Community Foundation has asked two different groups to review the current status of our primary survivor groups and assess the type of services that will be needed in the future. The first report prepared by Dr. Betty Pfefferbaum of the OU Department of Psychiatry describes mental health service needs and utilization in Oklahoma City bombing survivors and first responders. The second report was requested from the Oklahoma State Department of Health and reviews the types of physical health needs that might reasonably be anticipated for persons who were injured and/or disabled as a result of the bombing. Additionally, the Disaster Relief Fund has reviewed its own experience for educational expenditures coordinated through the Survivors Education Fund and is able to make projections regarding the potential funding requirements for scholarships. The expected needs of the scholarship program are the easiest to estimate because of the defined group, the known costs of education, the experience of the last ten years, and the time frame during which the scholarships will be offered. We expect that most of the eligible students will have concluded their education by 2017 (22 years after the bombing). We expect at least one of the major scholarship funds to terminate in the next three years and for the cost of education to continue to increase. Assuming a high utilization rate contributions should be more than sufficient to deal not only with the original commitments but additional graduate school opportunities that have been added.

5 Outside of the initial emergency assistance, mental health counseling is the most prevalent service provided through the Disaster Relief Fund. It was estimated that 45 percent of those survivors present in the buildings had a psychiatric disorder when studied after the bombing. Mental health services are essential for the recovery of many survivors and appropriate counseling underlies the potential for many to recover and rebuild their lives. FEMA provided support for initial services during the first two years and our funds have supported more significant and longer term needs. While it is difficult to predict the needs of specific individuals over time, we have the ability to control our long-term costs by defining the scope and type of services that will be provided. After ten years and several strong external traumatic events, we think that we know that our current caseload and that our current experience is indicative of future needs. Services for many will be needed for some time but we feel that we know the scope and cost of those needs. The biggest unknown in this area is the continually emerging needs of first-responders. A fund specifically donated for this group has been exhausted and they are the biggest source of new cases. The future need most difficult to anticipate is the unsupported health needs of those who were injured. The physical injuries created both long-term disabilities as well as generated chronic health conditions that continue to evolve. The injuries to children in the two day-care centers continue to manifest in many ways as these children grow and develop. Many of the physically injured were originally covered by health insurance plans that in some cases have limited long term benefits or are no longer available. Other conditions related to the injuries, especially respiratory conditions, sight and hearing, are latently appearing and need treatment. While we know that the adults with chronic conditions will eventually be eligible for Medicare for a great portion of their medical needs, we still have at least 30 years of potential costs for health conditions. The daycare center children present an even longer term challenge. In addition to the direct medical costs, living expenses for the injured are an additional support that has been provided by the funds. Living expenses initially provided to a large number of survivors and families have been reduced to a small group of families outside of those with chronic health or mental issues. We expect that most of the longterm need to provide living support will come from the physically injured and those with severe mental health impairment. Many of those who were unable to return to work or families that lost the primary income have qualified for disability income or other compensation or retirement programs. There are some additional expenses that are paid for some of these families but the total expenditures are well within the range of funds available through at least We have provided a lot of support for families with children eligible for the scholarship program but this need will phase out as the children complete education. One potential unknown is the impact of the eventual withdrawal of the American Red Cross. Their case-load could potentially add some cases requiring support for living expenses. Our long-term goal for living expenses is the group requiring support because of injuries and disability. The case management services that were at the core of our direct services are seen as crucial to our efforts efficiently to manage these funds in the future and to insure that the needs of the survivors and the basic commitments made by the community are met. needs to continue through the end of the Survivors Education Fund in The need for case management services will change after that and will focus on those with long-term physical and mental health conditions. Continuing the case management function will be an important support service for those with chronic mental and health conditions that will continue to receive support from the fund. Having a case manager that can address the unknown future needs and respond to those who might appear or reappear at a later date will provide an ongoing community response and insurance that these unknown needs will be addressed. The allocation recommendations at the end of this report are based on the experience of the past ten years, the level of future service needs identified in the two reports, the ability of the case manager function to help secure other available resources and the eventual utilization of government programs such as social security, Medicare and Medicaid, and other assistance for individuals with significant disabilities. Three key time periods are until 2017 when the Survivors Education Fund will conclude, 2035 when most of the adult

6 workers will have reached age 65 and become eligible for Medicare and retirement benefits, and 2060 when the last of the day care children reaches 65. Opportunities and Legacies The Internal Revenue Service Rules for the operation of emergency funds and grants to individuals require that charitable funds be used to provide for the needs of individuals that arise from the emergency and that cannot otherwise be met with other resources or compensation. All of the funds that participated in the RCC followed that standard which allowed for the most needs of the survivor families to be met. Because of the generosity of so many throughout the country, the Disaster Relief Fund is still able to respond to the needs of this survivor group. Those needs, especially the education, health, mental health, and living support expenses will always be the first priority of any funds received or generated by the Oklahoma City Disaster Relief Fund. Having made those commitments and appropriate allocations of contributions and earnings necessary to support them, the availability of earnings also provides the opportunity to consider two other areas that are consistent with donor intentions in responding to the bombing in The first is based on the unique and precedent setting experience that the Oklahoma City bombing provided to the nation. The community response, both the emergency rescue effort and the community cooperation for the recovery, the medical and mental health longitudinal studies on treatment and recovery and the similar documentation of social work impact all provide enormous amounts of information from which many disciplines might learn. We have an opportunity to add significantly to the understanding of the longterm needs from trauma. Both studies from the Department of Health and the OU Department of Psychiatry referred to the usefulness of data from continuing follow-up in informing others about what to expect in future incidents. Because of this unique experience several individuals from Oklahoma City were very involved in the planning of services following 9/11 in New York and Washington, DC. The experiences shared there have been repeated with many other communities. The Ford Foundation has contacted us about participating in an effort to help communities prepare for tragedy. The lessons learned are very applicable to other communities and events and the service model that eventually evolved in Oklahoma City was successful and its story should be documented and told. So much was given to Oklahoma City from around the nation, it is appropriate to consider how we can give back from both our experience and the abundance of resources that we received. The second area of consideration addresses the legacy of the bombing in our community. For many of the families of those who were killed, the Oklahoma City National Memorial is a significant remembrance and an important symbol of the impact of the tragedy on the lives of so many. For many in the community not directly involved with the services to survivors or familiar with the long-term recovery efforts, the memorial leadership that came to the Community Foundation for help in providing services to survivors, Mayor Ron Norick and Governor Frank Keating, also has put significant effort to building and sustaining the memorial. They have acknowledged to us their support of memorial as consistent with the purposes of the funds they established here. Supporting the memorial through a perpetual endowment does support many of the survivor families for whom the memorial and its variety of remembrance activities is important. For many of these families, helping to preserve the memory of their loved one will be an important service. An additional legacy is the opportunity of the community to always be prepared for an emergency or tragedy. During the two years following April 19, 1995, several social service organizations devoted significant administrative and support resources to providing service to survivor families and others affected by the

7 tragedy. They absorbed these costs within their own budgets. The infrastructure necessary to allow organizations within a community to provide services and to cooperate is crucial and needs to be established and maintained. Our community needs to have emergency workers that are trained for a variety of needs, social workers that understand case management for families and individuals in traumatic situations, psychologists, and other counselors who can serve these unique mental health needs and the capacity to provide administrative support so that everyone can work together smoothly and no one organization is burdened with the costs of coordination. The working legacy of the Oklahoma City bombing should be an management services and insures that through training and coordination, the community is prepared to meet needs that would arise. This endowment would eventually support the case management function that -term commitment to help the survivor families. Recommended Allocations Based on the commitments of the Oklahoma City Disaster Relief Fund to support survivors of the 1995 Oklahoma City bombing, the experience of the past ten years in both providing services and understanding the unique needs of the population, the analysis of future medical and mental health needs, and the unique opportunity that the Disaster Relief Fund has to contribute to the professional and academic body of knowledge, to support the memory of the event, and to provide a permanent disaster response capacity, the following long-term allocation of funds is recommended: Core Services: 1. Direct assistance for living expenses and support of survivor families, $600,000 (Current balance allocated to this function). This should support the existing case load outside of injured and families with children. Actual expenses have averaged about $60,000 a year for the past three years. We expect the need for this support to decline over the next few years. 2. Children s Support Fund. $400,000. (Current balance of remaining contributions). Assistance with educational, health and some living expenses for the children who are eligible for the Survivors Education Fund. Average expenditures have been about $18,000 annually, and the fund should be sufficient through 2017 when the Survivors Education Fund scholarships conclude. 3. Survivors Education Fund and other scholarships, $5,200,000 (Current balance of remaining contributions). The amount remaining in the fund should be more than sufficient to support the commitments for undergraduate assistance and graduate school stipends through Any funds remaining after 2017 should be divided between the Long Term Medical Fund for any unanticipated needs and the Infrastructure fund for scholarship to supporting the training needs for support workers in the community. An appropriate division can be made at that time. 4. Case management and coordination, $500,000. (An increase of $200,000 over the current allocation). This should support the current case management services provided by a dedicated staff worker through 2017 when the educational services are concluded. At that time, support from the case management needs will transfer to the Infrastructure fund as an appropriate long-term community function for which the fund was established. 5. Long Term Medical and Mental Health, $3,600,000 (An increase of $1.5 million over the current allocation. This fund should provide a safety net for the medical expenses, counseling expenses, and some assistance with living expenses for those with significant disabling conditions resulting from the bombing. It will cover medical conditions related to the bombing and chronic conditions that can be attributable to those injuries. The fund can payout $300,000 per year and pay for several larger medical claims and be expected to last through 2060 assuming a reasonable investment return. This

8 fund and the case manager support fund will be the last remaining core service in the Disaster Relief Fund. Opportunities and Legacies (all allocations are from earnings) 6. Long-term Studies, $500,000 to support the long-term follow up of those affected by the bombing for medical, mental health, and social work purposes. These studies would add to the professional and academic body of knowledge and would provide important data on the long-term effects of various treatments and services. Any funds not expended would revert to the Infrastructure fund which could also support continued long-term studies. 7. Helping other communities, $400,000 to support helping other communities learn about preparing for disaster and to contribute back to other communities when there are needs for emergency support such as we had in Any funds not expend would revert to the Infrastructure fund which could continue to work with other communities in training as well as providing support for their emergencies. 8. Oklahoma City National Memorial endowment for survivor support and activities. $1,500,000. This amount would be retained at the Community Foundation and would help the Memorial reach its $5 million fund-raising goal to get matching Federal funds. This would be a permanent fund with the annual earnings going to the memorial. If at anytime there is a shortfall in funds allocated to any of the basic commitments, these funds could be invaded to provide that support. 9. Community Infrastructure. $2,000,000. This fund would also be established as a permanent large scale tragedy. It would support training of a variety of support professionals, administrative needs around coordination and cooperation and basic preparedness to insure the capacity to respond to another tragedy. It would absorb the case management services after the conclusion of the Survivors Education Fund. If at anytime there is a shortfall in funds allocated to any of the basic commitments, these funds could be invaded to provide that support. At the end of the scholarship program in 2017, we would expect to have three major functions left: the Long- Term Medical and Mental Health Safety Net, the Community Infrastructure fund which should pick up the case management expenses as long as those services are provided, and the endowment for the memorial. Just as this allocation recommendation has been made based on experience and changing needs and opportunities, another review in 2012 and again in 2017 would be recommended.