www.oregoncf.org Agenda Community foundations The Endowment - - PowerPoint PPT Presentation

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www.oregoncf.org Agenda Community foundations The Endowment - - PowerPoint PPT Presentation

Jan 04, 2024 797 likes •1.18k views

www.oregoncf.org Agenda Community foundations The Endowment Partners Program Definition of endowment Investment program Break Fund administration Statements Fees Distributions Additions Deferred giving to

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Agenda

  • Community foundations
  • The Endowment Partners Program
  • Definition of endowment
  • Investment program

Break

  • Fund administration

– Statements – Fees – Distributions – Additions

  • Deferred giving to build endowment
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Community Foundations

Wikipedia: Instruments of civil society designed to pool donations into a coordinated investment and grant making facility dedicated primarily to the social improvement of a given place.

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The Oregon Community Foundation

Mission To improve lives for all Oregonians through the power of philanthropy.

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The Oregon Community Foundation

Many types of funds

  • Discretionary
  • Advised
  • Donor
  • Community
  • Corporate
  • Scholarship
  • Designated
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Designated Funds

Grantees designated at the time the fund is established

Donor Designated Fund

Donor = Individual(s) = For-profit = Non-profit Grantee = 501(c)(3) Public Charity Donor ≠ Grantee

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Designated Funds

Agency Endowment Fund

Donor = 501(c)(3) Public Charity Donor = Grantee

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Endowment Partner Funds

Primary Benefits

  • Access to investment expertise
  • Create efficiencies
  • Access to planned giving advice and services
  • Advice on complex gifts
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Endowment

Long-term fund created to support an organization

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Endowment

T wo Considerations:

  • Creation

– Donor? – Board of directors?

  • Use

– Income stream? – Rainy day fund?

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Endowment

True Endowment = Donor Restricted

  • Obligated to maintain in perpetuity
  • Cannot fully expend in the short term
  • Annual income stream
  • Revenue diversification
  • Additional restriction to use of income
  • OCF maintains arm’s length
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Endowment

Board Designated “All boards distrust their successors.”

Jerry Westersund

Board Designated = Emergency Reserve

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Endowment

OCF’s Definition

  • Fund maintained in perpetuity
  • Annual income stream
  • Goal = to manage the fund in a prudent

manner as to not exhaust it in the long term.

Model Considers

  • Investment
  • Expenditure
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Investment Objective

To retain (at a minimum) the purchasing power

  • f the funds

AND

When possible increase the purchasing power of the funds

WHILE

Producing a reasonable return for distribution to meet current community needs.

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Spending Policy

  • Board reviews rate annually

Projected 10-Year Return Payout Rate

9% or higher 5% Between 9% & current p/o rate 4.5% Below current p/o rate 4% - 4.5%

  • Based on13 quarter trailing average of market values
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Investment Program Overview

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Investment Committee

William Berg, Chair, Board Member Portland Lyn Hennion, Medford Karen Harding, Portland Chris Magana, Portland Kirby Dyess, Board Chair Beaverton Duane McDougall, Lake Oswego Garth Nisbet, Portland Ronald Parker, Portland Eric Parsons, Out of State William Rutherford, Portland Lane Shetterly, Board Member Dallas Duncan Wyse, Board Member Portland

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Endowment Investment Model

  • High allocation to equities
  • Broad diversification
  • Use of alternative strategies
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Investment Roles

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Asset Class Roles

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Main Investment Pool Allocation

December 31, 2017

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Social Impact Pool Allocation

December 31, 2017

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Volatility Matters

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Volatility Matters

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Investment Returns1

December 31, 2017

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T wenty-five-year Life of an Endowment Partner Fund 1993-2017

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Fund Administration

Statements Fees Distributions Additions

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Fee Schedule

Endowment Partner Funds

Up to $1 million .50% Next $4 million .20% Above $5 million .10 %

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How Life Income Gifts Work

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Our Partnership

Gift Type Minimum Gift Designation of Residuum/Remainder Notes Charitable Gift Annuity (CGA) $25,000  Residuum designated to nonprofit partner to add to an existing EP Fund  Create a new EP Fund, if residuum meets current funding amount  Minimum age of the annuitant is 60  55 and older eligible to set up deferred CGA  No fee Charitable Remainder Trust (CRT) $100,000  For OCF to serve as trustee, 50% of the charitable remainder value must be designated to nonprofit partner to add to an existing EP Fund  Remaining 50% may be distributed directly to nonprofit partner  New EP Fund may be created if the net present value of the remainder interest for OCF is greater than or equal to the current fund minimum ($25K)  Minimum age of beneficiary is 55  Payout percentage to beneficiary between 5% and 7%  Fees for preparation of trust document  Expenses related to carrying costs

  • f unmarketable assets prior to

their sale  Administrator fee approximately 80 bps annually

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For questions regarding Deferred Giving for Endowment Partners please contact Wendy Usher wusher@oregoncf.org

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Thank you for coming!

The slide deck can be found at

  • regoncf.org/donors/endowment-partners