In 2017, the City of Kalamazoo announced the creation of an unusual public–private partnership called the Foundation for Excellence (FFE), established through an anonymous $500 million donation intended to support long-term investment in Kalamazoo.

“The gist is, picture an endowment for a university—we’re an endowment for a municipality,” says Steven Brown, the Foundation’s Executive Director. “It came from the same place that most innovation comes from, which is having a big idea that answers a big challenge. A lot of innovation is shifting the context of an existing technology. The technology of an endowment already existed. The innovation here was shifting the context from higher education to a municipality.”

“It’s the first time it’s ever been done.”

In technical terms, the FFE is structured as a 501(c)(3) Type III organization. The donation is being distributed to the FFE over a 10-year period ending in 2030. “The corpus of the endowment is invested as any endowment is, and then the earnings each year are spun off to give grants to the City—and only to the City,” says Brown. “We’re legally prohibited from giving grants to anybody other than the City of Kalamazoo.”

You might have heard of the Kalamazoo Promise, established in 2005, which pledges to cover up to 100 percent of in-state college tuition for graduates of Kalamazoo Public Schools. “There’s a long history of transformational generosity in this community,” says Brown.

But the size and implications of the gift were still shocking. “People were concerned: ‘This is big money in politics. What’s that going to mean? What if politicians squander this unique gift—what if they do pet projects, try to build some monorail tower in the sky?’” says Brown.

“We had to get in front of that and say, ‘Every dollar we spend is going to be transparent. We’re going to have rules and bylaws,’” he says. “We have transparency so the community can see that the projects coming forward are as informed and long-viewed as possible, not just for short-term political points.” The result of that process, the Kalamazoo Foundation for Excellence, is the City of Kalamazoo’s entry for the 2026 Community Excellence Award.

The FFE is governed by a board of fifteen, comprised of five City directors (including the mayor, the city manager, two city commissioners, and one appointed at-large member). The other 10 are “stakeholder directors,” who are Kalamazoo residents chosen through a public application process, representing areas including health care, housing, the arts, education, and faith-based organizations. Finally, there are three neighborhood directors, representing one of the five Kalamazoo neighborhoods that have the longest legacy of poverty in them.

Due to its “functional integration” with the City, the FFE is subject to both the Open Meetings Act and Freedom of Information Act, “which is essentially unheard of in the foundation world—certainly for private foundations,” says Brown. “We publish all our agendas online, people can attend our meetings, and there’s an opportunity for public comment.” Those really wanting to get into the nitty-gritty can dig into the FFE website, where every dollar spent is tracked and can be searched for and filtered by category and neighborhood.

The FFE’s funding is divided into three main areas. One portion supports a 38 percent reduction in city property taxes, “to make us more competitive with surrounding jurisdictions in retaining and attracting people and businesses,” says Brown. “We’re a less dull town now.” The FFE also supports the General Fund, accounting for about $5 million per year, or 20 percent of the City budget.

The third category is “aspirational projects,” guided by the Imagine Kalamazoo 2025 Master Plan. “These projects are primarily in areas of affordable housing, small business development, infrastructure investment, youth development, and other innovative projects that support the community’s vision,” says Brown.

The City has supported the creation of more than 600 affordable housing units through a mix of infill construction, duplexes, triplexes, multifamily projects, and rehabilitation work. “We’re just getting started with that,” says Brown. “We’re going to continue that investment for years and decades to come.” Funding has been used to prevent tax foreclosures. “We’re a zero-tax foreclosure community, basically,” he adds.

Thanks to FFE funds, over 50 miles of sidewalk have been repaired and replaced. High school students can now use their school IDs as passes for the Kalamazoo Metro. Thousands of slots have been created for free, drop-in youth summer programs. Other investments include technical education programs, lead service line replacement, and support for small businesses through grants and building redevelopment.

“I could go all day with this,” says Brown. “We’ve invested $220 million in the last 10 years.”

Brown is aware of Kalamazoo’s good fortune. “Certainly, other communities have been very eager to model it,” he says. “Of course, there’s the entrance cost of having the ability to fund an endowment from a private source locally.” But he’s confident that the FFE model—with its principles of transparency, community input, accountability, and functional integration—are scalable and replicable to any type of municipality.

“The FFE is a unique approach to prosperity and reinvestment,” he says. “This should be by the people, for the people.”

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Emily Pinsuwan

Emily is the League’s full-time Content Writer, composing emails, articles, blog posts, and press releases. If you need words, she has many. Prior to becoming a word person, she was a restaurant person, handling catering, event management, and marketing; prior still, she was a teaching person, at a private boarding school in Massachusetts. Having earned a master’s degree in Classics from the University of Georgia, Emily is confident that she is the only League employee fluent in Latin. She also enjoys cooking, stand-up comedy, and is an avid gamer, having achieved level 40 on her Steam profile.