As a leader of a nonprofit organization, you work hard to fulfill your fiscal management responsibilities.
You may have noticed that...
- Your organization has excess cash held in reserve year after year
- Your organization's endowment is nonexistent, too small to make an impact, costly to manage, or not receiving good returns.
A possible solution...
The Greater Lynchburg Community Foundation can create an "agency fund" for the benefit of your organization. Grants will be paid out exclusively to your organization from the fund.
Benefits of an agency designated fund at the GLCF:
- Build an endowment that provides annual support for operations
- Invest reserve funds for growth over time
- Investment options through your choice of 6 different investment managers: Truist; Wells Fargo; Bank of America; CAPTRUST; Flippin, Bruce & Porter; or Pettyjohn, Wood & White
- Third-party oversight of your assets (and the trusted GLCF name to inspire confidence in your donors!)
- Donors can give to the fund online or by check directly to GLCF. We will handle gift acknowledgements and receipts.
- We can also handle more complex gifts, such as stock gifts, real estate, bequests, etc.
"CASA of Central Virginia evaluated several options but ultimately chose to start an endowment fund with the Greater Lynchburg Community Foundation because of its excellent reputation and dedication to supporting the local community. We have been impressed with the Foundation's knowledgeable staff, their deep understanding of the local community, and their ability to provide meaningful guidance and support throughout the entire process."
--Allison Stronza, Executive Director, CASA of Central Virginia
Generally, agency funds at the Greater Lynchburg Community Foundation are structured as follows:
- A permanent, irrevocable fund is established with your organization as the designated beneficiary.
- Your organization will make an irrevocable transfer of assets to the GLCF, creating a permanent endowment fund subject to the spending policies of our Board of Directors.
- The fund’s assets are invested.
- Your organization, at the time the fund is established, has a choice of 6 different investment managers: Truist; Wells Fargo; Bank of America; CAPTRUST; Flippin, Bruce & Porter; or Pettyjohn, Wood & White. If you do not state a preference, the GLCF will assign a manager on a rotating basis.
- Each of our investment managers will charge fees for services rendered, which will be deducted quarterly from the fund you establish. Fee schedules from investment managers will be provided upon request.
- Your organization receives an annual distribution (grant) from the agency fund.
- The current policy of the Board of Directors is to expend annually not more than 5% of the value of the fund, based upon a twelve-calendar quarter moving average. Annual distributions of income require an average value since establishment of the fund or over the twelve-quarter period of at least $10,000.00.
- The grant to your organization is made from the annual net income of the fund. This ensures that the the principal of the fund is always preserved. If any portion of the net income is not granted in a particular fiscal year, the undistributed net income for such year is added to principal.
- Net income is defined as a net amount that is earned while your money is invested. This may include interest and dividend plus gains or losses less any fees.
Access to principle is possible.
A distribution from the principal may be requested if the organization is facing extreme unforeseen financial needs that are not likely to recur, and the distribution will enable the organization to meet those needs. The organization’s Board of Directors must have a majority vote for approval of such a request. This request is solely advisory, and the Greater Lynchburg Community Foundation maintains final authority and control over whether such a distribution of principal will be permitted.
Administrative Fees
The actual cost of operating the foundation is covered by a tiered fee structure applied to funds under our management. Assets less than $1 million are assessed at a rate of 1%. In funds larger than $1 million, the second million dollars will be assessed at a rate of .8%, and any amount greater than $2 million will be assessed at the rate of .7%. Fees are charged to the fund with no further involvement from the original donor.
Power of Variance
The GLCF has the power of variance, which means that if a designated nonprofit ceases to exist the GLCF shall determine, in its sole discretion, the distribution of income from the fund. The GLCF would work with the Board of the organization to determine next best steps. At the time when an agency fund is established, the donor/organization may give instructions on the fund form in the event the organization ceases to exist.
How to Create Your Fund
- We will provide you with a simple fund agreement form to review and sign.
- You will choose which of our investment partners will manage the fund's assets.
- You will choose the name of the fund.
- The GLCF receives contributions from the agency to create the fund. A minimum of $10,000 is required and must be invested for a full fiscal year before a grant can be made.
Please contact Kathryn Yarzebinski, President & CEO, for more information.
The following local nonprofit organizations have agency funds at the Greater Lynchburg Community Foundation:
Junior League of Lynchburg
Anne Spencer House & Garden Museum, Inc.
Bedford Hospice House
Big Brothers Big Sisters
Boys & Girls Club of Greater Lynchburg
Brook Hill Farm
Camp Kum-Ba-Yah
CASA
CVACL
Free Clinic of Central Virginia
Friends of the Lynchburg Public Library
Interfaith Outreach Association
IRON Lives
Jefferson Choral Society
Johnson Health Center
Jubilee Family Development Center
Lake Christian Ministries
Legacy Museum of African-American History
Lynchburg Symphony Orchestra
Lynchburg Beacon of Hope
Lynchburg City Schools Education Foundation
Lynchburg Daily Bread
Lynchburg Economic Development
Meals on Wheels
Mount Carmel Church Cemetery Association
National D-Day Memorial Foundation
Opera on the James
Park View Community Mission
Patrick Henry Family Services
Rivermont Evangelical Presbyterian Church
Rush Homes
Southern Memorial Association (Old City Cemetery)
Step with Links
The Arc of Central Virginia
United Way of Central Virginia
Virginia Legal Aid Society
YWCA of Central Virginia
