Centre County Community Foundation

The fund is now named after three Pleasant Gap veterans who were casualties in World War II. “We thought that putting the money with the Community Foundation would ensure that… Read more

Youth participating in Pennsylvania Free Enterprise Week

Financials

Financial Report 2010

For more than 25 years the Centre County Community Foundation has been the steward of a precious community resource, Centre County's charitable endowment, composed of gifts from generous individuals, organizations, and corporations. In managing this endowment the Centre County Community Foundation seeks to provide sufficient funds to make current grants, while preserving the purchasing power of these charitable gifts forever. The region has benefited from the power of this endowment which has grown, generating ever-increasing grant funds for all of Centre County.

At the end of 2010, the Foundation’s total assets were $22,789,000. This represents a 14.3% increase from December 31, 2009 to December 31, 2010.

This growth came from two areas: investment returns and contributions. Our investments returned approximately 13% for 2010 and the Foundation furthered its mission and received gifts of approximately $1,577,000 during 2010. Meanwhile, our grant and program payments for 2010 exceeded $831,000.

The finances of the Foundation are administered by the Board of Directors which has ultimate responsibility for all decisions. The Board works through its Executive Committee and various other committees who oversee different aspects of operations.

By Board policy the Foundation annually:

  • Distributes a set percentage of the average asset value from each fund annually for charitable needs. In 2010 the distribution rate was 4%, but may be changed from time to time to reflect market returns and our fiduciary responsibility to preserve the value of our funds. For this calculation the average of the fund value over previous twenty quarters is used.
  • Draws a percentage from each fund for operations: 1.3% in 2010. This is based on a variety of factors including the asset base and operating budget.
  • Pays approximately .2% for active investment management.

This spending policy is consistent with most other community foundations, and is designed to provide steady and growing distributions back to the community.

The Foundation is fortunate to have a group of very talented individuals volunteer their time and expertise as members of this Investment Committee. The Investment Committee recommends specific investment policy and is responsible for guiding, monitoring and implementing the policy and reporting performance results. Presently the Foundation has working arrangements for financial management with First National Bank, M&T Investment Group, Nestlerode & Loy, Merrill Lynch, Weinken & Associates, and Smith Barney.

Additional funds are invested by the Investment Committee through Vanguard and The Investment Fund for Foundations (TIFF).

The assets of the Foundation are deployed in a variety of investments in accordance with the investment policy. It seeks to hold 40% to 80% of its assets in global securities, 20% to 60% in fixed-income instruments such as long-term bonds, debt-based mutual funds and temporary cash investments, and up to 30% in alternative assets in an effort to obtain higher yields. This so-called discretionary class of assets allows managers to move slightly outside the basic policy and acquire positions in high-yield bonds, emerging markets, particular market sectors or real estate, commodities, etc. Overall, the portfolio is invested for capital appreciation. At a minimum, the Foundation’s goal is to generate long-term investment results sufficient to pay its grants, operating, and investment expenses, while keeping pace with inflation.

The fixed-income portfolio is diversified and consists primarily of investment grade bonds, benchmarked against the Barclay Aggregate Index.

Employing broad diversification as to investment style and other major component weighting, the global equity portfolio is benchmarked against the MSCI All Country World Index, which includes broad categories of U.S. equities, non-U.S. developed market equities and emerging market equities.

The Foundation is exempt from federal income taxes under Section 501(a) of the Internal Revenue Code as a publicly supported organization described in Section 501(c)(3). It is also exempt from state taxes and is registered with the Pennsylvania Bureau of Charitable Organizations. All gifts are accepted subject to the Foundation’s Articles of Incorporation, By-Laws and policies.

Copies of the annual audit report and IRS Form 990 are available at the Foundation office.