Types of Funds Managed
The Campanile Foundation is responsible for receiving and
managing gifts in support of San Diego State University. In the discharge of
this fiduciary responsibility, The Campanile Foundation receives and manages
gifts for scholarships, program support, academic departments, colleges, and
the University. Gifts fall into two main
categories: current use gifts and endowment gifts.
- Current use gifts are made by donors with the expectation
that they will be expended in the near future to achieve the purpose for which
the gift was given. These types of gifts
are intended to support a wide variety of purposes but are similar in terms of
the donor’s expectation that they be expended completely to meet their
philanthropic intent. Current use gifts may be restricted (donor specifies how
the gift is to be used) or unrestricted (the designated beneficiary of the gift
decides how the gift will be used).
- Endowment gifts are made with an expectation that the
endowment funds grow over time. There
are two types of endowments, true and quasi.
A true endowment is set up by the donor to protect the principal in
perpetuity. Only the earnings on the
principal will be expended to meet the donor’s philanthropic intent, and the
funds will be invested for the long-term to provide an income stream in
perpetuity to achieve the purpose for which the gift was given. A quasi endowment is established to function
as an endowment in that the principal is to be retained and invested to grow
the funds; however, the entire principal and income may be spent at any time at
the discretion of the fund manager.
In order to meet the fiduciary responsibilities the
Foundation has to donors, funds are segregated into three different types of
- Scholarship gifts are put into A-Accounts and are, by board
policy, exempt from administration fees. Scholarship funds may come from annual
current gifts and/or income from a scholarship endowment fund.
- Current use gifts (other than scholarships) are put into
C-Accounts and are subject to a 6% administrative fee when expended. These
funds normally come from current use annual gifts but could also come from the
quarterly distributions from designated endowment funds.
- Endowment gifts are put into N-Accounts. Endowment funds
participate in the endowment investment pool in a manner similar to a mutual
fund. Each account has a pro-rata share
of the endowment pool and will earn income based on the relative percentage of
the market value of shares owned on each quarterly valuation date. True
endowments may not distribute any of the original principal of the gift to the
program beneficiary. Quasi endowments
may expend the principal and the earned income at any time for their specified purpose. The Campanile Foundation Board of Directors
establishes on an annual basis a distribution rate for endowment income. The
rate for 2012-13 is 4.0% of the three-year moving average of the market value.
Both true and quasi endowments utilize this distribution rate; however, if the
market value of a true endowment falls below the original principal value, only
interest and dividends earned will be distributed. A quasi endowment receives the full 4%
distribution regardless of market conditions.