Foundation Fighting Blindness

CharityWatch's rating of Foundation Fighting Blindness (FFB) also includes the financial activities of the affiliates consolidated in the FFB audited financial statements for the fiscal year ended June 30, 2022. The consolidated affiliates include the Foundation Fighting Blindness Retinal Degeneration Fund (the RD Fund) and Opus Genetics, Inc. All significant intercompany balances and transactions between the entities have been eliminated in the audit consolidation.

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 7, Concentration of Risk):  "The Organization received approximately 22% and 26% of its total public support from its Board of Directors and national trustees during the years ended June 30, 2022 and 2021, respectively..."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 6, Commitments and Contingencies, Paycheck Protection Program Promissory Note):

"On April 17, 2020, the Organization applied for and received a loan of $1,062,123 from Truist Bank, pursuant to the Paycheck Protection Program (the PPP) under...the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was enacted March 27, 2020. ... Proceeds were used to pay compensation and benefit costs in order to retain workers and to make mortgage interest payments, lease payments and utility payments. The Organization used the entire loan amount for qualifying expenses. The Organization applied for and received forgiveness for the entire loan amount on April 29, 2021, and has recognized the amount of the loan as revenue without donor restrictions in the consolidated statement of activities for the year ended June 30, 2021. The loan is subject to audit by the SBA [Small Business Administration] for a period of six years following forgiveness.

"On March 18, 2021, the Organization applied for and received a loan of $1,093,127 from Truist Bank, pursuant to the PPP under...the CARES Act... The interest rate was 1.0% per annum, payable monthly commencing one month after a decision on forgiveness was received... Proceeds may be used to pay compensation and benefit costs in order to retain workers and to make mortgage interest payments, lease payments and utility payments. The Organization used the entire loan amount for qualifying expenses. The Organization applied for and received forgiveness for the entire loan amount plus accrued interest of $1,106,609 on June 6, 2022, and has recognized the total amount of the loan and accrued interest as revenue without donor restrictions in the consolidated statement of activities for the year ended June 30, 2022. The loan is subject to audit by the SBA for a period of six years following forgiveness."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 6, Commitments and Contingencies, Research Grants):

"The Foundation has entered into grants with conditional renewal options including milestones. As of June 30, 2022, total conditional research commitments, including milestone contracts, were $46,030,443, which will be recognized in the consolidated financial statements when the conditions have been substantially met."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 10, Related Party Transactions):

"Given the Organization's singular focus on inherited retinal degenerative diseases and the limited pool of relevant experts to serve as advisors and investigators, there is some overlap in the Organization's operations and the research supporting the Organization's mission. The Organization's policy to mitigate this overlap requires that all grant applications be subject to independent evaluation by appropriate peer reviewers prior to grant commitment. The review and final approval process excludes anyone directly associated with the application, and anyone, including scientific experts, who, in any other way, has a recognizable conflict of interest.

"During the years ended June 30, 2022 and 2021, the Organization committed funds in the amount of $4,294,021 and $4,729,402, respectively, to research projects whose principal research investigators also serve as scientific experts."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 6, Commitments and Contingencies, Co-funding Agreements):

"The Organization has entered into co-funding agreements as a form of programmatic lending with two separate for-profit research companies. Each agreement outlines initial research funding, not to exceed $7,500,000 to either company, provided by the Organization. As of June 30, 2022, the Organization has paid a total of $12,250,000, with a potential of $750,000 remaining to be funded. The agreements include repayment terms whereby the Organization could be entitled to payments of up to $59,500,000 if both companies achieve commercial success in the future. ... The funded amounts were recorded as grant expense on the consolidated statements of activities in previous years when the funding occurred. Given the potential for any future repayment was highly uncertain, the receivable balance was insignificant."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 1 re: Financial Risk):

"Investments, in general, are exposed to various risks, such as interest rate, credit and overall market volatility. Due to the level of risk associated with the Organization's investments, it is at least reasonably possible that changes in the values of investments will occur in the near term and that such changes could materially affect the amounts reported in the [audited] consolidated statements of financial position."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 1 re: Management Estimates and Uncertainties):

"On January 30, 2020, the World Health Organization declared the coronavirus (COVID-19) outbreak a 'Public Health Emergency of International Concern' and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, quarantine in certain areas and forced closures for certain types of public places and businesses. The coronavirus and actions taken to mitigate it have had, and are expected to continue to have, an adverse impact on the economies and financial markets of many countries. While the extent of the impact of COVID-19 on the Organization's operations and financial performance are uncertain and cannot be predicted, the Organization is comfortable with its liquidity, and is continuing to execute its five-year strategic scientific spending plan. Management is continually monitoring the impact of COVID-19."

According to the Foundation Fighting Blindness consolidated audit of June 30, 2022 (Note 13, Subsequent Events):  "In July 2022, the RD Fund [Foundation Fighting Blindness Retinal Degeneration Fund] invested an additional $5,000,000 in Opus Genetics as part of its Milestone closing funding round."

According to The Foundation Fighting Blindness (FFB) tax filing for the fiscal year ended June 30, 2022, FFB reports re: Compensation, Supplemental Information (IRS Form 990, Schedule J, Part III):

Regarding severance payments to officers, directors, trustees, key employees and highest compensated employees (Schedule J, Part I, line 4a):

"Nancy Davenport received a severance payment during the calendar year. The payment is included in Part VII, column D ['Reportable compensation from the organization'] and Schedule J, Part II, column Biii ['Other reportable compensation']. The terms and conditions of the confidential severance agreement are available to the Internal Revenue Service upon request."

[Nancy M. Davenport is reported as "VP, Finance (thru 9/28/21)," with total compensation of $218,962 in calendar year 2021; $40,451 is the amount reported as her "Other reportable compensation" in column B(iii) (Schedule J, Part II).]

Regarding nonfixed payments to officers, directors, trustees, key employees and highest compensated employees (Schedule J, Part I, line 7):

"FFB employees participate in an annual incentive plan. The plan provides an annual cash bonus depending upon the achievement of pre-determined organization and individual performance criteria."

FFB reports "Bonus & incentive compensation" payments, including payments from related organizations, to 16 individuals in calendar year 2021 (IRS Form 990, Schedule J, Part II). The three highest reported "Bonus & incentive compensation" amounts are:

(1) Benjamin R. Yerxa, CEO: $223,814, with reported total compensation of $720,257;
(2) Jason D. Menzo, COO: $124,999, with reported total compensation of $521,288; and
(3) Russell W. Kelley, SVP, RD Fund: $85,195, with reported total compensation of $364,436.

The "Bonus & incentive compensation" payments reported by FFB to the remaining 13 individuals in calendar year 2021 ranged from $59,219 to $8,040, with associated reported total compensation ranging from $365,027 to $150,269. The reported compensation amounts for some individuals include compensation from related organizations (Schedule J, Part II).