Hershey's sweetheart deals

Revelations regarding the questionable expenditure of millions of charitable dollars by the trustees at the Hershey School deserve a thorough investigation by the state.

But the public can only hope that Attorney General Tom Corbett is up to the task of overseeing such a politically-sensitive probe while also campaigning for governor. Corbett’s Texas two-step highlights a problem of having the state’s top law enforcement official try to carry out his day job while also running for higher political office.

Tom Corbett

Milton S. Hershey School is funded by a charity created by the candy-company founder to teach poor children. The charity sits on a pile of money that its board apparently doesn’t know what to do with.

The Inquirer reported that the board paid an inflated price of $12 million for a golf course, and then spent another $5 million building a clubhouse. The purchase price was two to three times Hershey’s own appraisal for the golf course.
What exactly does a school for poor kids need with a golf course anyway? Especially when Hershey already owns three other courses. Hershey officials said the purchase was approved to prevent the land next to the school from being developed.

Coincidentally or not, the purchase bailed out 40 to 50 local businessmen and doctors who had made a bad investment in the money-losing golf course. Along came the school to bail out the executive duffers. One of those investors happened to be Richard H. Lanny, at the time chief executive of Hershey Co. Lanny was also on the board of the Hershey Trust, which oversees the school.

The chairman of the Hershey Trust board is Leroy Zimmeran, a former two-term state attorney general and avid golfer. Zimmeran is just one of the political heavyweights with seats on various Hershey boards, which pay them handsome six-figure sums for not much work.

Former Gov. Tom Ridge is on the board of the candy company. Former NFL star and gubernatorial candidate Lynn Swann is on the board that manages Hershey Park.

The golf course expenditure is just one of several questionable land deals completed by the Hershey School in the last six years. The board also spent $7.5 million to buy 18 acres that was leased back to the owner for use as a roadside market.

The big spending comes as the school scaled back plans to boost enrollment, due to the economy. Meanwhile, the lucrative compensation doled out to Hershey board members has soared.

The land deals and extravagant spending raise questions about conflicts of interest by board members, and whether they are upholding their fiduciary responsibility. The spending also appears to violate Milton S. Hershey’s directive when he set up the trust to fund a school for poor kids: “All revenues must be spent directly on the care and education of the children,” he wrote. “No moneys are allowed to be or are spent for any other purpose.”

Not even a fourth golf course.