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Numbers

WCF / ABOUT / Numbers

Numbers

Investment Managment

INVESTING FUNDS FOR THE BEST RETURNS IS CRITICAL TO OUR MISSION, AND TO ACHIEVING THE PHILANTHROPIC GOALS OF OUR DONORS. WE STRIVE TO MAXIMIZE INCOME WHILE ENSURING THAT WE ARE MANAGING FINANCIAL RISKS PRUDENTLY.

PHILOSOPHY

Our investment philosophy is to assure a long-term rate of growth sufficient to offset normal inflation, administrative fees, and management fees (if any), plus reasonable, regular distributions. Any income over the amount available to spend stays in the fund to make up for the years in which the overall returns fail to meet our goal.

The Foundation’s Investment and Finance Committee approves and monitors all investments on a regular basis. The Foundation Board of Directors receives regular reports on all its financial activities.

INVESTMENT & FINANCE COMMITTEE:

Earl Benson
Professor, Department of Finance and Marketing, Western Washington University

Tasha Dewey, CPA – Committee Chair
Partner, Moss Adams

Kevin DeYoung, Partner
Larson Gross

Karen Sloss, CFP®
Financial Advisor, Cetera Advisor Networks

Tim Vail, AWMA®, AIF
Wealth Management Advisor, Northwest Capital Management

Gary Barnett

Steve Swan
WCF Board Member

INVESTMENT APPROACH

Our investment approach is determined by our total assets and the cash flow requirements of our various Funds. Three investment pools are currently managed by our Investment and Finance Committee. Each pool has a different target allocation, intended to meet the unique cash flow needs of the Funds within the pool:

Long Term Pool – All endowed funds. Equities 65% Fixed Income 27% Real Estate 5% Cash Equivalents 3%

Mid Term Pool – Non-Endowed Funds, intended to be disbursed over several years. Equities 25% Fixed Income 65% Real Estate 5% Cash Equivalents 5%

Short Term Pool – Non-Endowed Funds, intended to be disbursed within one year, or if distribution plans are unknown. Cash Equivalents 100%

The Board has directed our Investment and Finance Committee to limit our investments to no-load mutual funds, cash, and other cash equivalents. At our current asset levels, this approach is seen as the most cost effective and prudent. The Investment and Finance Committee has selected index-type mutual funds that meet the investment objective of each pool.

ADMINISTRATIVE FEES

Annual fees cover normal administrative costs to manage investment and grantmaking and may also provide funds to support our community leadership activities. Additional fees may be assessed for required outside consulting, legal work, or the processing of large numbers of gifts or disbursements. Expense ratios associated with our investments are less than 0.3% at present. We do not provide financial benefits of any sort to third-party participants in the gift planning process. Currently, we do not charge a separate investment management fee.

ENDOWED FUNDS FEE STRUCTURE

Endowed funds will be charged an administrative service fee on the following progressive scale:

1.50% on the first $499,999.99 of fund assets
1.00% on fund amounts between $500,000 to $999,999.99
0.75% on fund amounts between $1 million and $4,999,999.99
0.50% on fund amounts above $5 million

The fee schedule will be applied to the total dollar amount in multiple endowed funds contributed by a single donor.

For example, a single donor maintains three endowed funds as follows:

Endowed Fund #1: $ 400,000.00
Endowed Fund #2: $ 300,000.00
Endowed Fund #3 $1,700,000.00
Total Single Donor Endowed Funds $2,400,000.00

Fee Calculation: (1.5% X $499,999.99) + (1.0% X $499,999.99) + (0.75% X $1,400,000.00) = $23,000.00 (Or an average fee of 0.9583%)

NON ENDOWED FUNDS FEE STRUCTURE

Non-endowed funds will be charged an administrative service fee on the following progressive scale:

2.00% on the first $499,999.99 of fund assets
1.50% on fund amounts between $500,000 to $999,999.99
1.25% on fund amounts between $1 million and $4,999,999.99
1.00% on fund amounts above $5 million

For example, a single donor maintains three non-endowed funds as follows:

Non-Endowed Fund #1: $ 400,000.00
Non-Endowed Fund #2: $ 300,000.00
Non-Endowed Fund #3 $1,700,000.00
Total Single Donor Non-Endowed Funds $2,400,000.00

Fee Calculation: (2% X $499,999.99) + (1.5% X $499,999.99) + (1.25% X $1,400,000.00) = $35,000.00 (Or an average fee of 1.4583%)

FEE ASSESSMENT

The fee is prorated and assessed monthly, ie 1/12 of the fee is assessed on the balance each month. In addition, new gifts to the fund will be assessed a fee upon receipt.


“Thanks for the financial report. As a retired CPA, it covered familiar territory. From a small start the Foundation has become a major force for progress and good in the Bellingam community.”

Best regards,  Julie Guy

Don’t see what you’re looking for? Get in touch!
360-671-6463  wcf@whatcomcf.org