Presentation Here September 28, 2016 Agenda Community foundations - - PowerPoint PPT Presentation

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Presentation Here September 28, 2016 Agenda Community foundations - - PowerPoint PPT Presentation

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THE OREGON COMMUNITY FOUNDATION Endowment Partners 101 Enter the Title of Your Presentation Here September 28, 2016 Agenda Community foundations The Endowment Partners Program Definition of endowment Investment Program Break

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Enter the Title of Your Presentation Here

THE OREGON COMMUNITY FOUNDATION

Endowment Partners 101

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www.oregoncf.org

September 28, 2016 Agenda

  • Community foundations
  • The Endowment Partners

Program

  • Definition of endowment
  • Investment Program

Break

  • Fund administration

– Statements – Fees – Distributions – Additions

  • Planned giving support
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www.oregoncf.org

What and who is The Oregon Community Foundation?

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www.oregoncf.org

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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www.oregoncf.org

The Oregon Community Foundation

Mission To improve lives for all Oregonians through the power of philanthropy. Publicly supported 501(c)(3) Donors

  • Individuals
  • Families
  • Businesses
  • Nonprofit organizations
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www.oregoncf.org

Many types of funds Discretionary Community Donor Advised Scholarship Designated

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Designated Funds

The grantees are designated at the time the fund is established.

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Two Types

Donor = Individual = Business = Organization Donor Grantee

Donor Designated Fund

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www.oregoncf.org

Two Types

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

Agency Endowment Fund

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www.oregoncf.org

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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www.oregoncf.org

Endowment

What does it really mean? Long-term fund created to support an organization

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www.oregoncf.org

Endowment

T wo Considerations:

  • Creation

– Donor? – Board of directors?

  • Use

– Income stream? – Rainy day fund?

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www.oregoncf.org

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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www.oregoncf.org

Endowment

Board Designated “All boards distrust their successors.”

Jerry Westersund

Board Designated = Emergency Reserve

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www.oregoncf.org

Endowment

OCF’s Definition

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

manner as to not exhaust in the long term

Model Considers

  • Investment
  • Expenditure
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www.oregoncf.org

Investment Policy

Objective

To retain (at a minimum) the purchasing power

  • f the funds,

while producing a reasonable return for distribution to meet current community needs.

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www.oregoncf.org

Spending Policy

  • Board reviews rate annually
  • Investment committee’s 10 projection
  • Target 9% return

– If 9% or higher  5% payout rate – If below 9%  4.5% payout rate

  • Basis = 13 quarter trailing average of market values
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www.oregoncf.org

Investment Program Overview

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www.oregoncf.org

Investment Committee

William Berg, Chair, Portland Lyn Hennion, Medford Karen Harding, Portland Chris Magana, Portland Tim Mabry, Board Chair Hermiston Duane McDougall, Board Member Lake Oswego William Moffat, Portland Garth Nisbet, Portland Ronald Parker, Portland Eric Parsons, Portland William Rutherford, Portland Lane Shetterly, Board Member Dallas Benjamin Whiteley, Portland Duncan Wyse, Board Member Portland

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www.oregoncf.org

Endowment Investment Model

Three tenets

– High allocation to equities is generally required for most spending levels. – Broad diversification mitigates risk inherent with high equity allocation – Fixed income supports spending during periods of prolonged economic contraction or deflation.

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Main Investment Pool Allocation

June 30, 2016

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Social Investment Pool Allocation

June 30, 2016

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Why Equities?

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Volatility Matters

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T wenty-three-year growth of an Endowment Partner Fund 1993-2015

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Investment Returns

for periods ended June 30, 2016

Trailing Trailing Trailing Trailing Quarter 1 Year 3 Years 5 Years 10 Years

Main Investment Pool

OCF 1.4% -3.4% 4.1% 3.8% 4.5% OCF Custom Benchmark 1.3% -2.8% 3.7% 3.4% 3.5%

Social Investment Pool

OCF 1.1% 0.6% 6.4% 5.9% OCF Custom Benchmark 1.3% -0.5% 5.9% 5.5%

Returns are net of investment management costs

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www.oregoncf.org

Market Update Cambridge Associates

2016 To Date – End of 2015 drop

  • China markets & oil plunge
  • Q1 = -0.7%

– Brexit at end of Q2

  • Flight to US Equities (overvalued)

– Uncertainty

  • Europe reaction to Brexit
  • U.S. elections
  • Monetary policy

– Low return environment

  • All asset classes
  • Global economy
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Enter the Title of Your Presentation Here

THE OREGON COMMUNITY FOUNDATION

Endowment Partners 101

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www.oregoncf.org

Fund Administration

Statements Fees Distributions Additions

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www.oregoncf.org

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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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www.oregoncf.org

Planned Giving

Julie Gregory Philanthropic Advisor & Regional Director Central & Eastern Oregon

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How Life Income Gifts Work

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Thank you for coming!

The slide deck can be found at

  • regoncf.org/donors/endowment-partners