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Spending Policy

Spending Policy

Revised June 18, 2009

Beginning with the fiscal year commencing July 1, 2009, and each year thereafter, the Foundation hereby adopts a spending policy of up to 5% of the value of the cash, securities and accrued interest for all its expenditures on behalf of the University and the Foundation itself. The actual percentage to be spent (the spending rate) shall be determined in advance during the year prior to the year of expenditure (currently 4.5%).

The amount spent shall equal the spending rate applied to the average value of the cash, securities and accrued interest of applicable funds of the Foundation during the 3 years prior to the year of determination. In computing the average value, the Foundation shall value its funds for each year on the last day of the fiscal year.

          This policy shall apply to all:

  1. Endowments both restricted and unrestricted; and
  2. Board designated endowments (quasi-endowments);
  3. Accumulated Income accounts associated with Endowment funds — which amounts may be added to principal and the income account closed at the discretion of the Executive Director of the Foundation.

This policy shall NOT apply to:

  1. So called “demand funds” which may be called upon at any time for use by University Department heads;
  2. All funds held for current use;
  3. Annual Giving Funds until set aside as Board Designated Endowments;
  4. General Scholarship Funds, except as provided under the Investment Policy for General Scholarship Funds if any are available for long term investment.

The following policy shall apply to General Scholarship Funds:

          The amount to be spent currently shall be:

  1. 50% of the average amount received for General Scholarships in the three years prior to the year in which the budget for scholarships is being developed, plus
  2. An amount equal to 5% to 20% of the value of the General Scholarship Fund on the preceding June 30 (i.e. the end of the prior fiscal year), less the amount in A; however,
  3. 4 times the total sum calculated in A & B shall not exceed the total value of the Scholarship Fund as determined in B.

Respectfully submitted,

David R. Kenerson, Jr., Chair, Finance Committee