BELFAST, Maine — When wealthy local resident Maud Gammans died in 1928, she left no children. Instead, she left behind a family legacy of civic philanthropy aimed at helping the city and its neediest residents.

That included $20,000 locked into the James A. Gammans Trust for the Needy Poor of Belfast, named for her deceased brother, who also died without children of his own.

The money in that account and three other charitable trusts bequeathed by different Belfast residents who wanted to help the poor has grown to nearly $800,000 today. But at least one family member is wondering whether the money that remains is still being used to help the needy local people for whom it was intended.

“How do we, or anybody, know if the funds in this trust fund are being disbursed in accordance with the family’s wishes when they set it up?” said Maura Gammans of Sidney, whose husband is a distant relative of Maud Gammans. “For all we know, the funds could just be sitting there creating custodial fees for the bank.”

By doing what she calls “obsessive” genealogical research, Maura Gammans said recently that she first learned last fall about the Gammans trust. When she started asking questions, she learned that city officials didn’t even know about the trust, or three others she discovered, including one that dates back to 1869. The local officials then started asking questions, too.

A review of recent IRS 990 tax filings for the James A. Gammans Trust and the three other charitable trusts indicate that there do not seem to be clear patterns of disbursement. In 2011, for example, the tax forms show that a total of $10,750 was given to charity from the four trusts — while $12,555 was spent on operating and administrative expenses.

The largest of the four, the 1929 Lena P. Frederick Trust, has a current market value of $531,000, according to Therese J. Myers, a spokesperson for KeyBank, which manages and serves as trustee for all four.

Frederick left her money to help the needy and sick of Belfast, especially the children of poor families who would otherwise suffer from lack of proper food, clothing, fire, shelter and medicine. That fund did make a significant donation to charity in 2011, when the trustee disbursed $10,000 in grants to the Belfast Public Health nurse, according to the 990 tax documents.

“We are privileged to have served as trustee for these four charitable trusts,” Myers recently wrote the BDN in an email. “As with all trusts, our primary responsibility is to uphold the wishes of the [donor] and the requirements of laws and regulations.”

But Maura Gammans isn’t so sure that Maud Gammans’ wishes are being upheld.

In 2011, for instance, the Gammans trust awarded $750 to charity, but paid out nearly $3,000 in administrative fees and costs. Two of the other trusts did not even hand out any money to charity that same year but together paid out about $3,000 in operating and administrative expenses.

“When people set up a trust for a charitable reason that they think is going to survive them in a concrete way and do good, and then it doesn’t happen, that seems very sad and wrong to me,” she said.

‘The people who fall through the cracks’

Longtime Belfast attorney and civic volunteer Lee Woodward said that he has seen the money from the four trusts do a great deal of good over the decades.

“The funds have been tremendously beneficial to a lot of organizations over the last 30 years. I’m hoping that continues,” he said. “They really have gone to grass-roots beneficiaries here in Belfast. I can think of hundreds of winter coats and necessities they’ve bought. It is amazing.”

Those words are echoed by Dan Bennett, director of operations for Waldo County General Hospital and Belfast Public Health. He said that the Lena P. Frederick Fund generally contributes between $3,000 and $5,000 per year to the public health service, which helps about 60 people annually.

“It is definitely having a profound impact on the neediest people in the community,” he said. “Belfast Public Health nursing is focused on Belfast itself, looking for the people who do fall through the cracks. The need is always out there. It was out there before we went through the recession. It’s continued strong.”

In the days before Social Security and food stamps, helping the poor was often a purely local effort, with community philanthropists doing whatever they could. With the creation of the Social Security Act of 1935, that kind of charity became largely outmoded. But some of the money that was earmarked for the poor a century or more ago remains stored away in trusts that often are held by entities like banks, municipalities or churches. Some of the trustees have trouble spending the money, because of the arcane provisions or now irrelevant causes affiliated with the trusts. Nathaniel Putnam of Eaton Peabody in Bangor, an attorney specializing in trusts, estimated recently that hundreds of thousands of dollars, at least, remain locked into older and sometimes obsolete charitable trusts held all over the state.

In Belfast, city councilors wonder how the “worthy poor” would know to seek help from the trusts, which are not well-publicized. That’s why Belfast City Attorney Bill Kelly is making the case to KeyBank that the city should be the new trustee for the four accounts.

“We talked to the bank. We said we deal with general assistance. When people in Belfast who need help go somewhere, they go to us,” Belfast City Manager Joe Slocum said. “They wouldn’t go to the bank. There are procedures, and if we didn’t know what they were, we’re assuming the poor people in town also wouldn’t know. Look, you’ve got a trust for the poor. How do the poor access it?”

‘Lost in time’

That question is an interesting one, with roots that stretch deep into history, according to Linda Conti, chief of the consumer protection division of the Maine Attorney General’s Office. Her division is tasked with the oversight of public charities, and she said that towns and cities all over the state used to have many private charitable trusts set up to fund places like poor farms.

“Times have changed,” Conti said. “But some of these trusts have gotten lost in time.”

Putnam said that he has spent a lot of time reinvigorating old trusts that were established for purposes that may no longer be relevant. For example, many people used to leave money in trusts designed to fund tuberculosis wards.

“Fast forward, and tuberculosis has been all but wiped out, yet we still have these charitable trusts. What to do with them?” he asked.

“Certainly in the hundreds of thousands of dollars or more” remain locked into old charitable trusts in Maine, Putnam said. But that money doesn’t need to be lost to time, in part because the law has changed to allow a clear pathway for it to have a modern beneficial use.

In 2005, Maine adopted a new trust code that allows trustees to modify old trusts so that they are more relevant to modern needs. The law presumes that if a person left money, for example, to help tubercular patients, the donor had a general charitable intent that could be satisfied in different ways.

One example Putnam gave was of a 120-year-old trust established to construct a new building for a church. More than a century later, the church was clearly not planning to move anytime soon, but the existing building needed a new roof and a new furnace. By going to court, the trust was modified so the money could be used for those improvements instead.

“I think a lot of the reason there are still these funds out there that aren’t doing anything is that people don’t know what to do with them,” Putnam said. “People don’t realize the law provides a pathway to bring these obsolete trusts into use.”

Conti said that in the 1990s, her office made a big effort to work with banks to find small, charitable trusts, terminate them and have the funds transferred to the Maine Community Foundation. That statewide nonprofit agency holds assets of $380 million in stewardship for more than 1,400 different funds.

Carl Little, the director of communications and marketing at the Maine Community Foundation, said that one example of a trust that has been repurposed is the Penobscot Valley Health Association Fund, which was established in 1906 to help tuberculosis sufferers in the greater Bangor area. In 1996, the association’s $2 million endowment became a component fund of the foundation. Last year, six grants totaling nearly $40,000 were made to support grass-roots organizations and start-up projects focused on strengthening the health and welfare of the greater Bangor area.

‘Long term vision’

Mark Hanna, a vice president at KeyBank, told the BDN recently that his financial institution, which has corporate offices across the U.S., manages more than $37 billion in private trusts.

“This is really terrific business,” he said. “We’re able to help people, manage their money and make it do what they wanted. These people had a long-term vision. KeyBank is here to carry that vision out.”

He said that the bank follows federal tax laws governing private trusts, including the rule requiring trusts to distribute an average of 5 percent of the net investment assets per year for charitable and administrative purposes.

When asked why the IRS 990 forms for the Belfast trusts showed that KeyBank spends more on administration than charities in some years, he answered that generally the bank has preserved and grown the principal while following the wishes of the grantors.

“You can’t just go off and do your own thing,” Hanna said, adding that the bank brings a lot of expertise and more. “We’re unbiased. We’ll be here long-term.”

Hanna said that some people’s concerns about how the trusts are handled may stem from the fact that the bank does not publicize charitable giving. He does think that the bank follows the intentions of the grantors. Gammans, for example, specified that her money should be used to purchase coal, wood or clothes for the poor.

“We could be giving coal to the kids [but] we’ll give money to the soup kitchen, which we think is in her intent,” Hanna said. “We have been following the spirit of what we believe she meant.”

Myers anticipates that the trustees will give $56,748 to Belfast charities this year. That’s more than triple what the bank says it distributed in 2013 and well more than double what was given to charity in 2012.

In order to find the right charities, KeyBank has worked with a local agent, who is paid $800 a year. The person who has held that role for the last five years stepped down in March. Hanna said that the bank is considering the city’s offer to act as trustee for the four trusts, although he has some questions.

“I’ve never heard of a city acting as a trustee,” he said. “What investment management expertise do they have to manage the funds? Obviously, they can see the needs more closely. Maybe the best solution would be for us to continue acting as we have and the city to tell us where that money could best be used.”

Myers said that if residents or interested parties have suggestions for donations from the trusts, they can send them to KPB_Charitable_Requests@keybank.com.

Meanwhile, as municipal officials and the bank discuss the city’s possible involvement with the trusts, Slocum, the Belfast city manager, said that though the phrase “worthy poor” has fallen into disuse, something that hasn’t changed is the fact that many people in Belfast are in need.

“We are the place where the poor come and knock on our door and say, ‘We need help,’” Slocum said.