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There are many ways to meet the needs of our growing region. Triangle Community Foundation offers several endowment-building solutions for nonprofits already serving our area. We are committed to helping local nonprofits build their endowments so that quality programs and services can continue to provide for the community for years to come.
Endowments help ensure the long-term sustainability of a nonprofit organization by providing a permanent source of support. Your nonprofit organization and your donors can establish a permanent nonprofit endowment fund to support a charity in perpetuity with contributions of your organization’s unrestricted dollars or with funds raised specifically for endowment building.
Endowed funds are permanent funds that seek to protect the long-term value of the fund by balancing principal protection with distributions. This is the classic definition of endowment. Endowments by law are required to follow the regulations for managing endowed assets as described in Chapter 36B of the North Carolina General Statues set forth in the Uniform Management of Institutional Funds Act (“UMIFA”). In addition to prudent investment management, endowment funds at Triangle Community Foundation comply with UMIFA through a sound spending policy.
The Foundation’s spending policy makes 5 percent of a fund’s average principal balance available for distribution annually. This amount is allocated on a quarterly balance and will accumulate until distributed or reinvested. Any or all of a fund’s “spendable balance” may be reinvested into principal balance at any time by written request and can also be continually reinvested until notification is given to the Foundation to do otherwise.
Please note; however, once reinvested these funds will remain in principal balance until re-allocated via the spending policy. Since a fund’s spendable balance may be requested for disbursement at any time, it is held in short-term bank deposits and does not earn interest for the fund.
A nonendowed fund allows for maximum flexibility while still being exposed to the stock and bond markets for investment purposes. Nonendowed funds are invested in the same investment pools with the endowed funds but are not limited to the 5 percent spending policy described above. Ten percent of the nonendowed fund is placed in a liquid reserve to allow for distributions.
The Foundation takes great pride in helping nonprofit agencies think through their options. We understand it can be a big step to commit funds in perpetuity with an endowed fund, and Foundation staff is available to meet with your staff and board to help you fully explore all your options.
Email Fred Stang, Director of Development, or call him at 919-474-8370, ext. 130. |
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