{"id":21,"date":"2017-04-07T22:49:05","date_gmt":"2017-04-07T22:49:05","guid":{"rendered":"http:\/\/parkerranch.com\/PRFT\/?page_id=21"},"modified":"2019-07-10T00:04:25","modified_gmt":"2019-07-10T00:04:25","slug":"the-trust","status":"publish","type":"page","link":"https:\/\/prft.org\/the-trust\/","title":{"rendered":"The 1992 Trust Establishment"},"content":{"rendered":"
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Parker Ranch Foundation Trust Perpetuating Richard Smart\u2019s Charitable Vision<\/h3>\n

Richard Smart created the Parker Ranch Foundation Trust (sometimes referred to as the \u201cTrust\u201d) on September 10, 1992 exclusively for health care, education, and charitable purposes within the scope of Section 501 (c) (3) of the Internal Revenue Code. The holdings of the Trust included substantially all assets of the Richard Smart Trust (the \u201cPersonal Trust\u201d). Beneficiaries of the Trust included North Hawaii Community Hospital, (formally Lucy Henriques Medical Center), Parker School, Hawaii Preparatory Academy and Hawaii Community Foundation.<\/p>\n

The Parker Ranch Foundation Trust was granted recognition by the Internal Revenue Service as a 501 (c) (3) charitable organization in January 1993. Lengthy legal challenges by Mr. Smart\u2019s sons delayed the start of Smart\u2019s estate plan. These lawsuits were resolved in 1995, and Parker Ranch, Inc. was then incorporated as the vehicle for holding and managing, directly or indirectly, the business assets of Richard Smart\u2019s estate. The Trust is its sole shareholder.<\/p>\n

Richard Smart, settlor of the Trust, named Warren Gunderson, Mel Hewett and Richard S. Hendrick as the initial trustees.\u00a0Today\u2019s trustees are Michael W. Gibson, Timothy E. Johns, Michael K. Fujimoto.[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column]

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\"\"<\/a><\/div><\/figure><\/div><\/div><\/div>[\/vc_column][\/vc_row][vc_row][vc_column][vc_tta_tour style=”flat” color=”white” active_section=”1″][vc_tta_section title=”Richard Smart Trust (the \u201cPersonal Trust\u201d)” tab_id=”1491958343865-bd8c9370-7e69″][vc_column_text]\n

The Personal Trust<\/h3>\n

The Personal Trust was a revocable personal trust created under the terms of a Trust Agreement dated August 3, 1978 (restated in its entirety on September 20, 1991, and amended on October 23, 1992 with several amendments and restatements) between Richard Smart as grantor and certain individual trustees. Smart transferred substantially all of his personal assets to the Personal Trust. Upon his death on November 12, 1992 the Personal Trust became irrevocable under the terms of the agreement. The amended restated agreement dictated that certain expenses, bequests or devices in the Last Will and Testament of Richard Smart be paid from Personal Trust principal, with the residual transferred to the Parker Ranch Foundation Trust.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=”How The Trust Began” tab_id=”1491958343905-1c4cb6df-1e82″][vc_column_text]\n

How The Trust Began<\/h3>\n

Richard Smart was strongly influenced by the long tenure of Bishop Estate as he intended the Parker Ranch Foundation Trust documents to provide guidelines for the future.<\/p>\n

Smart\u2019s vision was to focus on the educational and health needs of the Waimea community. He formulated the Trust to support that vision. The first named beneficiary was Parker School and soon thereafter he added the Lucy Henriques Medical Center, which later became North Hawaii Community Hospital. Smart believed that health care costs were rising at a faster rate than education-related expenses and he therefore designated a larger share of Trust distributions to health care.<\/p>\n

To further address both education and healthcare Smart added two additional beneficiaries: Hawaii Preparatory Academy and the Hawaii Community Foundation\u2019s Richard Smart Fund, which makes discretionary charitable distributions to fulfill other needs within the Kamuela community.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=”Richard Smart\u2019s Intentions” tab_id=”1491959250199-c34cefee-43f9″][vc_column_text]\n

Richard Smart\u2019s Intentions<\/h3>\n

In a departure from the Bishop Estate model, where the Bishop Estate actually runs the Kamehameha Schools, Smart wanted Parker Ranch Foundation Trust trustees to manage Trust assets in support of the charitable services of separately operating named Beneficiaries. While there would be communication between the Trustees and the Beneficiaries, the separate existence and operations of the parties would be respected.<\/p>\n

A Parker Ranch Foundation Trust Distribution Committee was formed with six members (three Trustees and three beneficiary members) to review the programs, purposes and financial needs of the Kamuela Charities and the Community Foundation.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=”Parker Ranch Lands” tab_id=”1491959281889-28f0e8c9-6d22″][vc_column_text]\n

Parker Ranch Lands<\/h3>\n

Richard Smart was mindful of the history of Parker Ranch being a sixth generation member of the Parker family. The economics of cattle ranching was undergoing some major changes in the 1960\u2019s that reduced operating profits. Smart sold land over the years to fund Ranch operations. Smart provided broad powers in the trustees, including selling land for Trust purposes. Smart also knew the Ranch needed to diversify to become profitable. His intention was for the various Parker Ranch entities to support the beneficiaries through distributable income. A separate corporation, Parker Ranch, Inc. was formed in 1995 to be the for-profit arm of the Trust.<\/p>\n

One of the primary goals of the Parker Ranch Foundation Trust as envisioned by Smart is to manage land and other assets to maximize the value of the Trust in order to provide a source for distributable income to the beneficiaries.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=”Trustee Roles” tab_id=”1491959312850-5618759a-d342″][vc_column_text]\n

Trustee Roles<\/h3>\n

The primary role of the Trustees is to establish a return on Trust assets to support the charitable Beneficiaries. Land sales to generate the best and highest return to the Beneficiaries, without damaging the value of the remaining holdings, and with sensitivity to the surrounding lands and community, was another important goal set forth by Richard Smart. Smart understood that initial distributions to Beneficiaries would be through the sale of assets because the Ranch was not profitable when the Trust was formed. Then, as today, Trustees remain acutely mindful of the importance to maintain the unique lifestyle and character of the Waimea community.<\/p>\n

In the event of large capital asset sales, Trustees were given broad discretion to make partial, or withhold, distributions to Beneficiaries. It was important to Smart that there be an appropriate balance of short term Beneficiary needs, intermediate term maximization of Trust assets, and the long term charitable purposes of the Trust.<\/p>\n

Source: Michael Shea, former Honolulu-based attorney who prepared the Parker Ranch Foundation Trust documents under Richard Smart\u2019s guidance.[\/vc_column_text][\/vc_tta_section][\/vc_tta_tour][\/vc_column][\/vc_row]\n<\/div>","protected":false},"excerpt":{"rendered":"

[vc_row][vc_column width=”1\/4″][\/vc_column][vc_column width=”3\/4″][vc_column_text] Parker Ranch Foundation Trust Perpetuating Richard Smart\u2019s Charitable Vision Richard Smart created the Parker Ranch Foundation Trust (sometimes referred to as the \u201cTrust\u201d) on September 10, 1992 exclusively for health care, education, and charitable purposes within the scope of Section 501 (c) (3) of the Internal Revenue Code. The holdings of the…<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"_links":{"self":[{"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/pages\/21"}],"collection":[{"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/comments?post=21"}],"version-history":[{"count":18,"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/pages\/21\/revisions"}],"predecessor-version":[{"id":368,"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/pages\/21\/revisions\/368"}],"wp:attachment":[{"href":"https:\/\/prft.org\/wp-json\/wp\/v2\/media?parent=21"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}