Board Policy: Endowment Management

DRAFT

DRAFT Endowment Management Policy

Draft Board Policy: Endowment Management (LIM-XXX)

Policy Title: Endowment Management Policy
Purpose: To ensure the prudent management of The Circle School Endowment, safeguarding its long-term sustainability while supporting the mission of the school.

1. Purpose of the Endowment

The Circle School Endowment exists to secure the long-term stability and resilience of The Circle School’s mission. The endowment ensures the school can:

  • Weather economic challenges.
  • Maintain affordable tuition.
  • Provide meaningful financial aid.
  • Support staff compensation and development.
  • Preserve the school’s values, culture, and legacy for future generations.

2. Gift Acceptance

  • Contributions to the endowment shall be irrevocable and designated solely for the Endowment Fund.
  • All endowment contributions are subject to The Circle School’s charitable gift acceptance policies.

3. Investment Principles

  • Endowment funds shall be invested in accordance with The Circle School’s investment policy, prioritizing:
    • Total return and growth.
    • Diversification, safety, and liquidity.
  • Endowment assets may be pooled with other assets for cost-effective management.

4. Distribution for Expenditure

  • Threshold for Withdrawals:
    • Withdrawals may begin once the fund reaches $1,000,000 or on July 1, 2035, whichever occurs first.
    • Before this milestone, all income and capital appreciation shall be reinvested to grow the principal.
  • Distribution Limits:
    • Once eligible, annual distributions shall be between 2% and 7% of the fund’s value at the end of the prior calendar year.
    • Extraordinary withdrawals (a) exceeding 7% or (b) occurring before the endowment balance reaches $1,000,000 require approval by a two-thirds majority of the Board of Trustees and must align with the school’s long-term interests.
  • Considerations:
    • Distribution decisions shall account for the fund’s earnings, economic conditions, extraordinary needs, and the goal of maintaining principal.

5. Recognition of Donors

  • The Circle School will honor endowment donors in ways that reflect the values of inclusivity and community.
  • Donors may choose to remain anonymous or be publicly recognized.
  • The Board reserves the right to determine appropriate recognition methods.

6. Reporting and Transparency

  • The Board of Trustees shall receive an annual report on the endowment’s performance, distributions, and impact.
  • A summary of endowment activity shall be shared with the community during the school’s annual meeting.

7. Policy Amendments

  • Amendments to this policy require approval by a two-thirds majority of the Board of Trustees.
  • Any changes must honor the original intent of the endowment to the greatest extent possible.