Description, Policies, and Procedures
Updated March 2016
The Foothills Unitarian Church Endowment Fund Committee (“Committee”) is constituted to recognize and administer gifts to the Foothills Unitarian Church Endowment Fund (“Fund”). The purpose of the Fund is to enhance the mission of the Church apart from the Church’s general operating funds. If there is any conflict between this document and the Bylaws of the Church, the Bylaws will control.
The Fund and the Committee will continue operating so long as Foothills Unitarian Church exists. If the Church ceases operations, the Fund will be disbursed in the same manner as other Church property under the Bylaws.
The Committee will consist of five members, all of whom will be voting members of Foothills Unitarian Church and elected according to the Church Bylaws. The members will serve in staggered terms of three years, which will coincide with the Church’s fiscal year. No member will serve for more than two consecutive terms. After one year has elapsed, former Committee members may be re-elected. The Senior Minister and the Chair of the Finance Committee will be non-voting advisory members of the Committee. The Committee will be accountable directly to the Board and to the members of the congregation.
The Committee will meet at least quarterly. A quorum will consist of three members, whose vote will be sufficient to carry any motion or resolution.
The Committee will elect from its membership a Chair, a Financial Secretary, a Recording Secretary, and a Corresponding Secretary. Each position will have the duties described in Article XIII.
The Committee will report quarterly to the Finance Committee and at each annual meeting of the congregation. The Committee may seek out other members of the congregation to serve as advisory members and, with the prior approval of the Finance Committee and at the Fund’s expense, engage professional investment and legal counseling as the Committee may deem necessary. The Committee will amend the Description, Rules, and Procedures whenever necessary to conduct its business and to maintain the purposes of the Fund. Changes in the Policies and Procedures must be approved by the church board. No member of the Committee will engage in any self-dealing or any transactions with the Fund in which the member has a direct or indirect financial interest. Each member will at all times refrain from any conduct in which the member’s personal interests conflict with the interests of the Fund and will refrain from any appearance of such impropriety. The Committee will ensure that each contribution to the Fund is formally acknowledged so that the donor may claim a charitable tax deduction.
VII. CONTRIBUTIONS TO THE FUND
The assets of the Endowment Fund include donations given “in memory of” a person, directed to a “Memorial Fund,” or given by will, trust, gift annuity, or similar bequest. Donors may make contributions as Unrestricted Funds, Donor-Restricted Funds, or Targeted Funds. The pro rata earnings of each of these funds, determined as of June 30, will be recorded in the Committee minutes on approximately August 30 each year.
A. Unrestricted Funds
Unrestricted Funds are the general contributions to the Church. No minimum contribution is required. Unrestricted Funds consist of all gifts and bequests not specifically designated as Donor-Restricted Funds or Targeted Funds. Investment decisions for Unrestricted Funds will be made solely by the Committee. Distributions from Unrestricted Funds will be administered by the Committee.
B. Donor-Restricted Funds
Donor-Restricted Funds are initiated by individual donors. A minimum initial contribution of $10,000 is required. Investment decisions for Donor-Restricted Funds will be made solely by the Committee. Distributions from Donor-Restricted Funds will be administered by the Committee. The donor may define how the gift will be used, how principal and interest are to be distributed, and over what period of time distributions are to take place. The gift and special terms must be approved by the Committee and the Board and must be appropriate to the goals and purposes of the Church.
C. Targeted Funds
Targeted Funds are created by the Board on the recommendation of a Church committee or group. A minimum initial contribution of $10,000 is required. Any Donor-Restricted Fund that is also a Targeted Fund will be treated as a Targeted Fund. Investment decisions for Targeted Funds will be made solely by the Endowment Fund Committee. Pro rata earnings of each Targeted Fund will be reported to the Board or the initiating Church committee or group on approximately August 30 each year. Distributions from each Targeted Fund are administered by the Board or the responsible Church committee or group for special purposes or uses. Any special terms must be approved by the Endowment Fund Committee and the Board and must be appropriate to the goals and purposes of the Church.
D. Donations, Gifts, or Bequests Less Than $10,000
If a donation, gift, or bequest in an amount of less than $10,000 is made to the church for a special purpose, the church may use that donation, gift or bequest for the designated purpose and such donation, gift, or bequest shall be directed to the committee or entity within the Church generally responsible for addressing issues related to the designated special purpose. The Endowment Committee shall have no responsibility or oversight with regard to such donations, gifts, or bequests.
VIII. ASSETS OF THE FUND
All assets of the Fund will be held in the name of Foothills Unitarian Church but will be accounted for separately from Church operating funds and other property belonging to the Church. The Committee may, but is not required to, physically separate any Donor-Restricted or Targeted Funds.
IX. INVESTMENT OBJECTIVES
The Fund is a long-term investment. The Committee will seek preservation of the Fund’s principal and provide for a dependable and reasonable rate of return with low to moderate investment risk. The endowment’s funds shall be invested with the Unitarian Universalist Common Endowment Fund and monitored by the Endowment Committee.
Specific Donor-Restricted or Targeted Funds may be treated differently. Ambitious goals of profit maximization through market timing or short-term, speculative, or overly risky investments will not be considered. The Committee will avoid fixed-income securities that are not denominated in U.S. dollars, venture capital arrangements, factoring or guaranteed investment contracts, direct investment in commodities, precious metals, or gems, international equities not traded on domestic exchanges, limited partnership interests, and interests in closely-held corporations or limited liability companies. Gifts of real estate (other than publicly traded real estate investment trusts or similar investment entities that otherwise satisfy the requirements of this paragraph), partial interests in property, property encumbered by debt, gifts of property that may have title or environmental problems, gifts of property that may not be marketable within a reasonable time, and gifts of property that may raise adverse tax consequences for the Fund will be evaluated by the Committee and the Board before being accepted into the Fund. The Endowment Committee may choose not to accept any donation that it considers to be not in the best interest of the Endowment Fund and the church.
X. DISTRIBUTIONS FROM THE FUND.
A. Unrestricted Funds. Each year, the Endowment Fund Financial Secretary will determine the earnings growth of the unrestricted fund for the past year beginning July 1 and ending June 30. The Endowment Fund Committee may distribute grants from the amount of the earnings of the unrestricted fund up to five percent of the unrestricted fund. The principle of the fund shall not be spent. Spending restrictions may only be changed by a vote of the church membership. Unrestricted Funds, valued as of June 30, may be distributed by the Committee for any use that furthers the mission of the Church, including but not limited to:
1. Capital improvements and renovations (which will be a priority area for grant-making by the Committee).
2. Education, youth, worship, and music at the Church.
3. Unitarian camps, conferences, and schools.
In September before the grant process begins, the church board, church staff, and finance committee will inform the Endowment Committee of church needs and priorities. The Endowment Committee will work with the appropriate church personnel and or committees to develop grant proposals. Grants will be issued only after recommendation of the Committee to the Board and approval by the Board.
B. Donor-Restricted Funds. Distributions will be made by the Committee according to the terms defined by the donor. The Committee may solicit suggestions or requests for funding and will implement procedures for soliciting, processing, and disbursing grant requests. Grants will be issued only after recommendation of the Committee to the Board and approval by the Board.
C. Targeted Funds. Decisions regarding distributions will be administered by the Board or the Church committee or group that initiated the Fund.
No member of the Committee will be personally liable for any losses experienced by the Fund except to the extent the losses were caused by the member’s gross negligence or intentional misconduct or omission. The Committee and its members will not be responsible for advising donors of any tax or other consequences that may result from any gift. Donors will be advised to consult an attorney, accountant, or other tax advisor concerning the potential consequences of a gift in the donor’s circumstances.
XII. CHURCH OFFICE PROCEDURES TO SUPPORT ENDOWMENT FUND COMMITTEE FUNCTIONS.
A. The Church Bookkeeper will keep the Committee informed of donations received, disbursements of grant amounts, account balances, and other matters needing attention or management by the Committee. The Church Bookkeeper will provide bookkeeping and financial information as necessary to accomplish the purposes of the Committee.
B. The Church Bookkeeper will log all donations to the Endowment Fund into the Church bookkeeping records. The Church Bookkeeper will contact the Endowment Committee’s Corresponding Secretary with the relevant information related to donations to the endowment fund. The Endowment Fund Committee Corresponding Secretary will then write an acknowledgement note to the donor and/or the donor’s family.
C. Upon receipt investment statements and notices, the Church Bookkeeper will keep appropriate records to reflect the current values of each account. The church bookkeeper will report to the endowment Committee one week prior to Endowment committee meetings the status of Endowment Committee accounts held by the church.. It is the responsibility of the Endowment Committee’s Financial Secretary to monitor online financial statements of investments and report to the committee.
XIII. COMMITTEE POSITION DESCRIPTIONS
• Schedule and remind members of meetings.
• Recruit new members as needed (and give names to Nominating Committee well before the annual congregational meeting).
• Publicize information about the Endowment Committee in appropriate church communications
• Each July, determine whether account signatories need to be updated and, if so, take necessary action.
• Ensure all major gifts are acknowledged, including bequests.
• Be familiar with procedures for acknowledging memorial gifts and be sure the Corresponding Secretary understands them.
• Coordinate activities relating to fund development and publicity..
• Supervise grant procedure, including solicitation and review of funding requests
• Present recommendations concerning grant applications to the Board.
• Inform Finance Committee Chair and Senior Minister of activities and upcoming meetings
• Inform grant applicants of the status of the grant application
B. Corresponding Secretary
• Write acknowledgement to the family of the deceased and or donor who has given bequest or memorial gift.
C. Financial Secretary
• Obtain financial information as needed to conduct Committee business
• Coordinate with Bookkeeper to obtain needed Fund information and records.
• Ensure that Church staff or the Committee send quarterly financial statements to Church Treasurer and Finance Committee.
• Purchase new investments as necessary.
• Monitor balance and maturity dates of investments and report to the Committee.
• Ensure that Church staff or the Committee provide fiscal year-end reports of account balances and gifts to the Board.
• Determine amount of money available for grants.
• Ensure that Church staff or the Committee maintain Endowment Fund records, including donations.
D. Recording Secretary
• Document meeting minutes and put copy in Committee binder in Library.
• Maintain and update Committee binder, including investment statements.
XIV. RECEIPT AND ACKNOWLEDGEMENT OF GIFTS AND BEQUESTS.
The Committee will write acknowledgements for undesignated gifts that go into Unrestricted Funds or Donor-Restricted Funds. For gifts to Targeted Funds, the appropriate Board member, Church committee, or group that initiated the fund will handle acknowledgements. Acknowledgements will be sent to both the donor and the family of the deceased.
A. After receiving appropriate information from Church Bookkeeper or Corresponding Secretary, the Financial Secretary will report the information to the committee and this information shall be included in committee minutes. Acknowledgements will be sent to donors within one week of receipt.. The Corresponding Secretary will notify the ministerial staff of the donations to the endowment.
B. Acknowledgements of gifts of $250.00 or more must be accompanied by the following statement: “This was a charitable donation. No goods and services were received in exchange for this donation. The only benefit received was an intangible religious benefit.”
XV. ACCOUNT SIGNATORIES AND ELECTRONIC ACCESS.
The Committee must have full account access to Endowment Fund investments in order to manage the investments according to the Committee’s investment plan and decisions. Signatories on Fund investments must be updated when designated signatories leave their positions as Committee or Board members. The names of the signatories on the endowment’s accounts will be reported in the committee’s minutes at the beginning of each fiscal year.
A. No more than three individuals should be designated as signatories at any one time. The signatories will be determined by the Endowment Committee.
B. To reduce the frequency of signatory changes, it is advisable to designate individuals who are expected to hold their positions or membership on the Committee or Board of Trustees for at least two years.
C. Phone and online account access can only be established and maintained by a designated signatory. For corporate accounts, the investment firm must be contacted by phone to verify information and set up access. The Financial Secretary is generally charged with the task of acquiring and maintaining access and with obtaining account information as needed to conduct Committee business.
XVI. PROCEDURES FOR ENDOWMENT FUND GRANTS.
A. The Endowment Fund holdings will be reviewed each year after second-quarter investment statements are received. The dollar amount available for grants will generally be determined by August 30.
B. If funds are available for disbursement, and directed by the church board in September and October the Endowment Committee may solicit grant proposals from the church membership at large. Announcements soliciting grant applications will be published through appropriate church media. Grant applications will be made available in the Church office.
C. Grant applications must be received by the Committee by November 1.
D. No later than the Board of Trustees’ January meeting, the Committee will recommend which projects to fund and in what amounts. Final decisions regarding funding of grants will rest with the Board of Trustees.
E. The Committee will notify grant applicants of the Board’s decisions. The Committee will provide funds for approved grants as soon as possible through the Church bookkeeper.
F. Persons and committees approved for grant funding must report on expenditures and project status to the Committee by the next June 30. Reports on multi-year grants must be made by June 30 each year until the project is complete.
G. Timing, deadlines, and grant procedures may be modified by the Committee as needed for appropriate management of the Endowment Fund.