Milton Hershey and His Trust

Photo: WikiImages

Last month, I shared about Milton Hershey’s orphanage and school (https://www.hhhistory.com/2021/12/milton-hersheys-orphanage.html). Today I’d like to share about his foundation. 

Founded in 1905, the Hershey Trust Company is a state-chartered trust company that serves as the trustee for the Milton Hershey School Trust, the M.S. Hershey Foundation Trust, and the Hershey Cemetery TrustAt its founding, Milton Hershey was named administrator for the trust. 

 

The trust was created to serve as the community’s bank. Located in offices inside the Cocoa House, the town’s first commercial building, the bank offered a wide variety of services. In addition to handling Hershey business payrolls, the company offered savings accounts, mortgages, and commercial and personal loans. 

Photo: WikiImages

Interestingly, the bank did a lot of marketing and advertising to the community, encouraging residents to save money and plan for the future. Specialized savings accounts such as Christmas Savings Clubs were created to encourage new account business, and deposit stations were established on Hershey trolleys. After the Hersheys created the Deed of Trust that established the Milton Hershey School (originally named Hershey Industrial School), the trust company was named trustee for the school. Until 1918, Mr. Hershey paid many of the school’s expenses. 

That year, unknown to anyone, he gifted the Trust with all his company stock (worth $60 million at the time). As a result of this action, the trust company took on the additional responsibilities of managing the land assets and other financial investments that were part of Mr. Hershey’s holdings. In doing so, the board of the trust realized they needed to separate the bank, and established Hershey National Bank as a separate entity. 

During the 1960s, the Foundation began to assume ownership of the community’s cultural organizations. In 1970 it took over the Hershey Theater, in 1981 the Hershey Museum, and Hershey Gardens in 1989. By doing so, the institutions gained non-profit status. By 1981, Hershey Trust’s ownership of Hershey Foods had shrunk to 50.1% causing concerns that they could lose control of the corporation through a corporate raid or hostile takeover. A two-tier plan was created that enabled the Trust to maintain majority ownership. 

Photo: mhskids.org

In February 2011, Robert Reese, grandson of H.B. Reese (inventor of Reese’s Peanut Butter Cups), former board member and president of the trust filed a lawsuit against the trust company claiming that the Trust had improperly used the Trust’s money. Two months later, Reese dropped his suit. However, the Pennsylvania Attorney General took over and conducted a two-year investigation that did not find any wrongdoing, but required reforms within the organization. 

Today the fund is worth more than $33 million and makes quarterly payments to the school district. Mr. Hershey would be proud. 

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Linda Shenton Matchett writes about ordinary people who did extraordinary things in days gone by. A volunteer docent and archivist for the Wright Museum of WWII, Linda is a former trustee for her local public library. She is a native of Baltimore, Maryland and was born a stone’s throw from Fort McHenry. Linda has lived in historic places all her life, and is now located in central New Hampshire where her favorite activities include exploring historic sites and immersing herself in the imaginary worlds created by other authors. Learn more about Linda and her books at http://www.LindaShentonMatchett.com

Dinah’s Dilemma (Westward Home and Hearts Mail-Order Brides): 

Will she have to run from the past for the rest of her life? 

Dinah Simpkins has no chance of making a good marriage. Her outlaw brothers and her father’s gambling addiction have ruined the family’s reputation. Then the Westward Home and Hearts Matrimonial Agency provides an opportunity for a fresh start. After Dinah arrives in Nebraska, she discovers her brothers played a part in the death of her prospective groom’s first wife. 

As a former Pinkerton detective Nathan Childs knows when someone is lying. The bride sent by the matrimonial agency may be beautiful, but she’s definitely hiding something, and he has no intention of marrying her until he uncovers the truth. But an easier solution may be to send her packing. Then his young daughter goes missing. He and Dinah must put aside their mutual hurt and mistrust to find her.

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