LDS fund educates thousands, inspires millions

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Elder John Carmack, director of the LDS Church's Perpetual Education Fund.

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To many Mormons, LDS President Gordon B. Hinckley's March 2001 announcement of the Perpetual Education Fund carried the weight of divine revelation. Members who had served missions in Third World countries cheered the proposal of a churchwide program to help needy Mormons secure an education.

But to Elder John Carmack, a soon-to-be-emeritus LDS general authority, Hinckley's revolutionary announcement brought a blend of excitement and anxiety.

A few months earlier, Hinckley had called Carmack to ask him to head up the new department. Hinckley had offered few specifics, save that the program would be based on LDS principles of self-reliance and that all funds would go directly to the recipients, not to a top-heavy

Apondi Suzan Kumanyi, recipient of a PEF loan in Uganda. (Apondi Suzan Kumanyi)

Though he had no experience in international loans or educational scholarships, Carmack soon realized this new program would have a profound effect on the present and future of The Church of Jesus Christ of Latter-day Saints.

"PEF would impact virtually every LDS department and function, including accounting, controlling, financial, treasury, priesthood, fund-raising, information management, welfare, auditing, public affairs and investing," Carmack wrote in his 2004 book, A Bright Ray of Hope: The Perpetual Education Fund . "It would change the landscape of the church in areas where it was implemented."

Nearly a decade later, the program has collected tens of millions in donated funds and has

Many Latter-day Saints consider the fund the church's most important change since the 1978 end to the ban on black males holding the priesthood. It gives a personal, professional and even a spiritual boost to church members with few other options by lending money for schooling that recipients would repay later.

Apondi Suzan Kumanyi's father stopped paying her school fees when she was 12, the same year she joined the LDS Church in Uganda with her younger sister. One older sister after another helped her through grade school, with intermittent years at home for lack of funds.

In high school, Apondi "contested to be head girl [student-body president] and, upon winning, got a scholarship for two years and it covered books," she writes in an e-mail. "Then I enrolled at the university but could not afford it."

She received a PEF loan, which allowed her to continue her studies in Library and Information Science at Makerere University. She is eager to earn her degree and begin repaying the loan.

"I have seen the windows of heaven and have been drenched with blessings," 25-year-old Apondi says. "I am very grateful, more than I can ever comprehend."

An idea trickles up

Reports from across the globe at the turn of the 21st century indicated that the LDS Church "had a problem that was persistent and growing." All kinds of Mormons were worried.

After a trip to Chile and Brazil in the late 1980s, Warner Woodworth, professor of organizational behavior at Brigham Young University, reported to LDS officials that 82 percent of returned missionaries in Third World countries went inactive within a year. The problem, he said, was economic.

"The day they were released from their mission was the worst day of their lives, and it often went downhill from there," Woodworth says. "They couldn't afford to get married or get into college. Many couldn't even afford bus fare to church."

Woodworth began floating the idea of an educational-loan program, which he dubbed the Perpetual Education Fund, much like the revolving loans his Mormon ancestors had used to emigrate to Utah.

A few years later, after a stint as an LDS mission president in Geneva, Switzerland, educator Rex Allen wanted to focus on impoverished former Mormon missionaries. He too devised an educational-loan program, this one based on individual initiative that would not involve any kind of handout. The church already was providing some employment aid through its Welfare Department and scholarship assistance through its Institutes of Religion, but with modest success.

In October 2000, Allen laid out his ideas to friends at church headquarters and offered his services, but never heard back.

That same month, Woodworth and other Mormon business leaders announced the launch of Unitus, a nonprofit organization dedicated to improving economic conditions of church members. At a one-day conference in downtown Salt Lake City, Oregon executive Reed Dame described one such project already under way.

Dame said when his company, Woodgrain Millwork, opened plants in Brazil and Chile, it found many potential workers were uneducated. The average monthly income in those countries was $200 -- equal to the monthly cost of attending college. Dame offered to pay tuition for young Mormons, particularly returned missionaries, who wanted to go to school. At the time, his company underwrote tuition for 380 men and 75 women.

The keynote speaker at that 2000 conference was Hinckley, who was given an award for his humanitarian efforts.

"I have walked among the poor across the Earth," the then-90-year-old Mormon leader said. "I have seen so much suffering and deprivation, trouble and sorrow, my heart has ached."

Poverty spawns ignorance and illiteracy, Hinckley said, which leads to unemployment. "Without education, these people cannot be lifted."

Six months later, Hinckley came back with a daring, comprehensive plan to do something about that.

With Carmack as its executive director, Richard Cook, an expert in global finance, as managing director, and Chad Evans, of the church's Welfare Department, as director of operations, Allen climbed on board to help develop training materials for future loan recipients.

"It was, of course, the perfect answer -- an elegant, sweeping, simple solution with a powerful historical precedent," Allen said later. "It was not a 'program,' in the transitory sense, but a 'bold initiative ... inspired of the Lord.' "

Historic connection

Hinckley adopted Woodworth's name, "the Perpetual Education Fund," and consciously modeled it after the church's 19th-century effort to help scores of British, European and Scandinavian converts gather to Utah. The Perpetual Emigration Fund loaned money to immigrants who then would repay it for future travelers.

The newly created Education Fund would function essentially the same way, providing loans for students to learn such skills as computer science, refrigeration engineering and other high-demand skills, Hinckley said in 2001. "The plan may later be extended to training for the professions."

The largest group of recipients is in Brazil, with 13,000, followed by northern South America, with 8,500, and Mexico with 5,000.

"We're in more than a dozen countries in Africa, especially South Africa," Carmack said this week. "We're also in Ghana and in Nigeria and have just gotten permission to begin in the Ivory Coast."

Recipients (more than half are women) are expected to begin repaying the loan, as well as 3 percent interest, within months of graduation. They receive regular messages about their continuing debt. The overall payback rate is about 64 percent, Carmack said, with some of the best areas being South Africa and Central America.

The biggest challenge is keeping track of people in all those nations, he said. "Many hardly have an address, let alone a bank account. They live in difficult circumstances and move around a lot."

Clearly, Carmack believes cases like Peter Simon Ochieg make it all worthwhile.

Ochieg used a PEF loan for tuition at Uganda's Makerere University, where he was enrolled in information technology.

"This greatly opened my mind to new skills," writes Ochieg, who also serves as an LDS branch president. "I have since been involved in opportunities such as implementing network structures for local banks, designing Web sites for nongovernmental organizations and small businesses among others."

That's precisely what Hinckley, who died in 2008, hoped would happen.

"With good employment skills, these young men and women can rise out of the poverty they and generations before them have known. ... They will serve in the church and grow in leadership and responsibility," he said in 2001. "The church will be much the stronger for their presence."

pstack@sltrib.com