Ways to Establish a FundThe primary role of the Community Foundation of the Sequim- Dungeness Valley is to act as a “savings account”, providing a stable, ongoing source of finding to assist in addressing the needs and opportunities to make the Sequim – Dungeness valley a better place to live and work. The Foundation’s responsibility to the donor and the community is to ensure the effective use the gift through prudent investment and grant management.
Most donors’ contributions are held in permanent endowment Funds. These Funds are pooled for investment purposes and managed by professional investment managers under the supervision of the Foundation’s Board of Directors. By pooling resources, the Foundation is able to maximize the return on investment and while minimizing operating costs.
Income from the endowment Fund is disbursed in support of charitable programs, primarily in the Sequim – Dungeness Valley area. As an endowment organization the Foundation’s funding for the community may be relied upon to continue in the future in ever-increasing amounts.
Granting for Maximum EffectThe Foundation is equipped with expertise in the funding needs and opportunities in the community. Grants are made after a thorough review of applications, including site visits and interviews with applicants.
By combining the income form each gift with that from other donors’ gifts, the Foundation is able to leverage gifts for maximum impact and maximum program support – far in excess of the amount that any single Fund alone could achieve. In addition, the knowledge and relationships the foundation has with other funds, charities, foundations and the government etc, enables us through cooperative granting to further leverage donors’ gifts.
The responsibility of the Community Foundation does not end with the making of the grant. The Foundation also conducts follow-up to assess the effectiveness of the grants to determine whether to maintain funding or consider further funding.
Types of Funds
In support of our primary role as an endowment organization, The Community Foundation seeks to facilitate charitable giving in accordance with the donors’ personal, financial and philanthropic objectives. In this regard, we work with donors and their advisors to develop gifting strategies and to offer a variety of Fund options to suit different personal and philanthropic objectives.
The following is a summary of the Funds to which Donors may direct their contributions.
The Community Endowment Fund
This important Fund allocates flexibility in matching a donor’s philanthropic priorities with Sequim - Dungeness Valley’s needs. The Community Endowment Fund enables the Foundation to respond quickly to the areas of urgency within our community. The income is distributed in the form of grants recommended by the Grants Committee and approved by the Board of Directors, in response to applications received from various community organizations.
Field of Interest Fund
Grants are made to organizations within a specific area of interest after applications for funding have been approved by the Board of Directors.
Donor Advised Fund
The benefactor, benefactor’s family, or designates recommend annually to the Board of Directors which charitable organizations should receive the income from the Fund.
Designated Funds
Grants are made to those charitable organizations specified at the time the Fund is established.
Agreements
Sample Fund agreements used in facilitating Fund arrangements are available.
Potential benefactors should be advised that a $5,000 minimum is required to open a fund.
Investment Philosophy
As a Community Foundation, The Community Foundation of the Sequim-Dungeness Valley holds charitable endowment for the community in perpetuity. As stewards of the community’s funds, we have three main investment priorities:
- Protection of capital
- Maximization of return commensurate with safety and
- Ensure capital growth
To meet investment goals, the Foundation follows a total return strategy, with the intent of maximizing the long term return of the entire portfolio both from market-value increases (realized and unrealized gains) and from current-yield (interest and dividends). Following the national norm for most community foundations, assets are allocated among a number of stocks, bonds and cash managers to produce the highest return and lowest risk. Investment decisions optimize the total rate of return and limit year-to-year risk of income and market fluctuations. The optimal portfolio allocation is one that carefully equates expected rate of return with expected risk of all investment categories used in the portfolio.
To protect capital and maximize return, endowment funds are commingled in an investment pool which provides the wide breath of investment managers listed above. The investment pool allows each fund no matter the size to receive the maximum benefit of investing in the Investment Committee’s approved asset allocations. Each fund is unitized and receives the proportional share of income, dividends and gain as well as the proportional share of the investment expense.
This philosophy is implemented by the Community Foundation holding some funds in local banks either in checking accounts, savings accounts or certificates of deposit. Some funds are placed with the Tacoma Community Foundation in an endowment fund. We hold the same investment philosophy as the Tacoma Community Foundation thereby making our relationship mutually enjoyable. For funds placed at the Tacoma Community Foundation please see their statement of investment philosophy with its placement discussion.
