Special Edition 6: Great Philanthropists - Walter Scott and the Private-Public Partnership

Welcome to another edition of “Around with Randall”, your weekly podcast making your non-profit more effective for your community, and here is your host, the CEO and Founder of Hallett Philanthropy, Randall Hallett.

I can't thank you enough for joining me again here on “Around with Randall.” Today we delve into our great philanthropist series and talk about a very generous individual who may not be at the lips of most people but actually in this case is someone that I knew. The gentleman we're going to speak to today, and in part certainly his wife who passed several years ago, is a gentleman by the name of Walter Scott. And, on a personal note, I’m a little disappointed. I wanted to start my series with Walter but decided not to because it was too close to home and that I would look in a more - a larger spectrum at philanthropy, and it wasn't till about ten days ago - maybe two weeks - when this drops that Walter passed away, and I had the great privilege of of knowing Mr. Scott.

Walter was a very kind and good man, sharp, intelligent, and really the essence of what an amazing philanthropist is. So why why did I pick Walter, besides kind of some personal knowledge? Well, let me tell you a little bit about him like we do with most of our great philanthropists. Walter grew up as a third generation American with his grandparents coming over from Scotland, and he spent most of his life in the engineering/ architecture world. Growing up, actually, he worked his way in part through Colorado State working on projects at a company called Kiewit and Sons, and you may not have ever heard of Kiewit but it's an Omaha company that does enormous, enormous construction projects. They built - or dug -  the Chunnel between France and England. They do bridges and nuclear power plants around the world. They build some of the world's largest in expansion bridges - I mean it's a this is not building a mall this is building infrastructure for entire countries and it's centered in Omaha, Nebraska. And Walter started his career there, worked almost his entire life there, and eventually became the Chair of the Board and President, steering it to some of its greatest heights. In addition, he was a boyhood friend of another great Omahan, and Walter or excuse me Warren Buffett and served on Mr. Buffett's board with Berkshire. And particularly some of the things he does in energy in the course of his life, Walter accumulated net assets of something around $4-5 billion is kind of the rough estimate. But he's given so much away that it's tough to kind of estimate.

He passed a few weeks ago at the age of 90. And the reason I wanted to highlight him is he brings an interesting perspective into how to invest philanthropy into your community. He indicated once in a quote, which I think really exemplifies his view of the idea of what we're going to tactically think about as public-private partnerships. A city is always an unfinished project so we keep looking for new opportunities to improve Omaha. Upon his passing, and I knew this his entire estate -  he's already taking care of kids and grandkids financially - his entire estate estimated again somewhere between $4 and $5 billion will go into his foundation that was established many years ago and will be used to better Omaha and Nebraska. And if you think about $4 billion as a round figure that means $200 million a year coming into the community that will be required. He's already giving immense amounts of money in his - in an article that was basically a long-form obituary the paper estimated that since 2001 he had given away about $500 million to Omaha or Nebraska-type causes. Having been somewhat around him I know that's short by a factor of three, at least. I think the number is probably closer somewhere between a billion and a billion and a half, which means his total contributions in life will, I don't know, $5, $6 billion but that isn't the completely unique thing about Walter.

Walter, way back in the late late 1990s, wanted to find a way to marry the idea of nonprofit work with the public-private partnership of government and to leverage the value that government can bring in bringing infrastructure, but bring the efficiency and effectiveness that the private sector through nonprofits bring to the table. And he created, along with several other although he was the leading impetus, several other community leaders, this organization called Heritage Services, and they would raise money in partnership to better Omaha. So what does that look like? It's kind of unique and recently in the last couple of years it's reached a national scale, which we'll talk about here in a moment. 

One of their first projects was the Durham Museum, which was the old train station in Omaha. Dilapidated. Collapsing. Nobody knew what to do with it, you know. Certainly it was kind of on the rolls as a building that that was just left and through the idea of this private-public partnership the the station was given to a nonprofit from the Union Pacific and Heritage Services raised the money to rebuild it or to give it an enormous facelift to the tunes of tens of millions of dollars to bring it back, and then create a museum out of it, and then hand it off to a nonprofit to run, that was the first in the late 1990s for Omaha. What came out of that were a series of projects over the next 20 to 25 years that included things like very similarly to the Durham Museum, the Strategic Air and Command Museum, which is now the Air and Space Museum, which was a joint venture with a private-public partnership in the strategic air command as well as a nonprofit to run it when it was done being re-built out -  just outside of Omaha. The first governmental was the CHI Center, then known as Centurylink, that was a convention center and state-of-the-art performance arena ,basketball, volleyball, whatever, that is very unusual to be found in a community of a million people in the metropolitan area of Omaha. 

That's why we host the swimming trials every four years and NCAA basketball tournaments. Most communities our size don't get that opportunity, but we have a facility - both convention and performance - that is second-to-none that was the city government coming in with tax dollars and fundraising, and it was about a 50-50 split. Certainly, we have things like the libraries, where Heritage Services raised immense amounts of money to rebuild most of the libraries and is now going through another stage where the government's putting in some money in, philanthropies putting in the rest, not government, still runs it. But at the end of the day, philanthropy is a part of the financial equation to keep our libraries in great shape. There is also the work that was done to expand the University of Nebraska Omaha. An entire new part of campus came out of the old Ak-Sar-Ben Racetrack area and Ak-Sar-Ben in case you're wondering is Nebraska spelled backwards. You can write it out. And the idea was is that there would be private money raised for a multi-use enormous part of the central core of the city to build a new business school, a new engineering school, new dorms, all kinds of things and at the same time put in private business and it's a vibrant area that also, that's tangential in terms of geographic space, to the main campus. And then that was all handed over to be run through either the university or through private investment opportunities, but philanthropy drove that project. 

Certainly things like even as small as realization that the Omaha Public Schools needed performance fields, athletic fields, and there's number of them in the community where Heritage Services raised private dollars to build stadiums, not just for football nights but for band and for track and for gym classes, and all kinds of other things, where OPS didn't have the resources to do so. 

The last one, which is maybe the most impressive, is that this opportunity of private-public partnership reached into healthcare. Walter and other several other community leaders, along with our congressional representation both senatorial and in the US House got a law passed that said for the first time ever we're going to allow a VA hospital to be built in this public-private partnership. And instead of the government building it, we're going to raise 60 percent of the money and we're going to build it and then we're going to hand it back to the VA to be run. We don't want to run the hospital, we just want to build it with let's say 60 percent philanthropic dollars. That had never happened. In fact, they had to pass a law in congress and get it signed by the President to allow that kind of operation. What happened? It came in under budget. It came in ahead of time, and it's provided one of the finest facilities in the world for veterans. Now, there's two others in that same kind of model being done in other parts of the country. 

What Walter saw and that I witnessed in my time at the Nebraska Medical Center, and in partnership with the university, was the idea of bringing the community together. That we didn't have to have siloed government and non-profit, that they could merge together to create a better opportunity to be efficient and effective in building to raising money and then handing that back over to the people who can run it efficiently. He believed in this idea of giving. He was once quoted as saying that the greatest thing you can do in life is be a giver because the world has plenty of takers but it's that merger of the public-private that really leverages need of the community from elected officials ,which by the way, is a good thing. And he would have said that we need elected officials. They represent all of us with the power of kind of a private enterprise mentality - efficiency, effectiveness, outcome, and philanthropy - for people who have done very well and want to see their community be a better place. 

Why did this work in omaha? Well, I think it was something he said in 1998 that I would tie to that as a reason why. It was started here. Why this was so important to Omaha? In the New York Times he was quoted as saying “our problem here in Omaha or the midwest is we can't move any mountains here, or oceans here. We're stuck on the prairie so we're going to have to make the most of what we have.” He saw the prairie as an oasis of opportunity. The legacy he leaves in this idea of public-private partnership, and if I might add, also all the people he taught at Omaha about how to be philanthropic, is going to keep Omaha in an amazing place. I am a homer. I live here. I’m fifth generation. I love my home, but people who come here from out of state to visit or to live look at me at least once a month when I run into various people and say I can't believe this is all here. Whether it's the state-of-the-art, world-class arts facilities or the number one rated zoo in the world or museums that people are stunned by, or the fact that we're the home of the College World Series, we've hosted swim trials, this is a destination and most people don't know it. 

I’ll leave you with this. I like to call Walter, have for many years, as the godfather of philanthropy for Omaha. He saw things people didn't understand. He could execute them and explain them and he could make our community a better place for all. And the best thing about Walter is, he wanted really none of the credit although his name and his wonderful wives - he was married twice-  the first passed in 1983 from cancer - he remarried a fantastic woman - their names are all over this community. But it wasn't because he asked for it or wanted it, it was just important for the for the nonprofits and the entities to be aligned with Walter’s name. He wanted his life to be about helping others and the great thing about him was he exemplified the word philanthropy - love of mankind - he wanted to make the world a better place, and creating this idea of public-private partnerships at a exponential level on steroids, different than any other place I’ve ever been in my in my entire career, could be a catalyst for what we see into the future. And I just hope Walter gets his credit, even though he wouldn't want it.

What can you do? Find those people who want your community to be a better place and find ways to explain how your nonprofit can partner with others, whether it's other nonprofits or the government or whomever, to get big results big outcomes for your community's needs.

Don't forget, some people make things happen, some people watch things happen, and then there are those who wondered what happened. I was incredibly blessed to have not a friend relationship - I know he loved my wife but a relationship with Mr. Walter Scott and I’m the better for it. And most importantly our community's a better -  it's better for it, and that's what makes him one of our great philanthropists in this world. I thank you for joining me on this edition. Hope this was helpful to give you something to think about a little bit different, and we'll be back next time, back into our regular flow of important factors, issues, challenges, and thoughts around our nonprofit world. Appreciate your time today here on “Around with Randall.” Don't forget make it a great day.