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Endowments

Endowments are an excellent long-term strategy for ensuring an annual funding stream to sustain and grow programs. To receive a meaningful annual payout (the “interest”), the principal balance must be significant in size and proportionate to the purposes of the fund.

Questions? Contact: 
Mary Ciricillo
Director of Development
UC Agriculture and Natural Resources
mciricillo@ucanr.edu 
(530) 219-1085

Resources: 

Endowments FAQs and How To's

Can I create an endowment to fund salaries, programs, and research?

  • Endowments are a great LONG-TERM solution to provide funding to sustain your programs.
  • They can be established for counties, for statewide programs, and RECs as well as for statewide initiatives and research areas.
  • Unlike current use funds, endowed funds are designed to grow over time, the principal balance remaining untouchable.
  • The annual payout for all UC endowments is based on 4.450% of the market value of the fund (rate established by the UC Regents). Therefore, for example, a $100,000 endowment provides an estimated annual payout of $4,450. Note: this is based on a 60-month rolling average therefore the payout may exceed/be less than the anticipated amount.

How can I establish an endowment?

  • A minimum investment of $25,000 is required to establish an endowed fund.
  • Endowed funds can be established as a result of a targeted fundraising campaign, through an individual gift or gifts, or through a bequest or planned gift.
  • In the case of a fundraising effort, the messaging must be clear - funds raised will go into an endowed fund for long-term sustainability.
  • In the case of gifts and bequests, the donor must indicate clearly that the purpose of their gift is to establish and/or contribute to an endowed fund.
  • We will work with you to define the purpose and goals for the endowed fund and determine the best strategies for securing contributions.
  • Once you have hit the minimum threshold, we will work with you to establish the endowment so that it will be part of the UC General Endowment Pool.

I have a surplus in one of my accounts – can I use it to establish an endowed fund?

  • This is a complicated question. You will need to review those surplus funds to determine the source and purpose for which they were intended (the donor’s intent).
  • To be eligible for transfer to an endowment, funds must have been raised with long-term intent in mind.
  • Funds raised from private Foundations are often not eligible as Foundations generally shy away from making endowment contributions.
  • We can discuss the best approach to reviewing your funds and will work with the UC Office of Institutional Advancement to review and approve a transfer.

How is my endowment invested – does UC ANR get to define the investment strategy?

  • All endowments for the UC system are invested as part of the General Endowment Pool (GEP), overseen by the Chief Investment Officer of the Regents.
  • UC ANR is not involved in investment strategies. These are reviewed annually and defined by the Regents and adjusted based on the overall return.
  • Payouts are received once/year, usually in August after the fiscal year closes. Payouts are based on a 60-month rolling average to ensure a consistent and relatively steady flow to reduce the impact of changing markets and investment results.

Does UC ANR decide how it wants to use the annual payout from its endowed funds?

  • Endowed funds can ONLY be used for the purpose specified in the endowment terms; they cannot be appropriated for another program or purpose.
  • UC ANR funds support specific counties, programs, research areas, and positions.

Can we “cash out” an endowment if we need additional funds?

  • “True” or “Permanent” endowments are considered “inviolate” – once established, they are permanent, and the principal cannot be invaded for any purpose.
  • There is one exception to this - an endowment established as an FFE (Fund Functioning as an Endowment). The intent for these funds is clearly outlined in their terms.
  • These funds can be used for large-scale projects but require rigorous review and approval before they can be drawn down. As an example, an FFE may have been established as a result of the sale of property with the intent to buy new property.

Once I have an endowment, can I raise additional funds to increase the principal balance?

  • Yes, in virtually all cases, additional gifts can be made to grow an endowment. This is indicated in the endowment terms.

Where do I start?

  • Contact Mary Ciricillo,mciricillo@ucanr.edu, in Development Services for assistance including:
    • Determination of appropriate fund for your situation
    • Development of fund language to ensure maximum flexibility
    • Support in developing fundraising messaging to secure gifts for your endowment
    • Approval and establishment of the endowed fund
    • Follow up regarding the establishment of an annual payout account