Frequently Asked Questions
One of the first questions now being asked is whether or not churches or institutions in the Dioceses of Southern Virginia and Southwestern Virginia can participate in the Trustees of the Funds. The answer is YES! As of late 2013, the trustees authorized the expansion of services to all of the Commonwealth as a means of providing strongly managed and prudently invested portfolios to the Episcopal Church in Virginia.
If you have any further questions or need assistance, please contact Mr. Michael Kerr or Mrs. Laura Hicks at 800-346-2373.
- Can individuals participate as investors?
Individuals can make gifts or bequests to the Trustees where the beneficiary is a church, one of the three dioceses or a clearly Episcopal Church-related organization (within the Commonwealth of Virginia). Individuals may not have personal investment accounts managed by the Trustees within the core or STAMP portfolios.
Individuals can establish annuity funds within the Gift Annuity Fund where the ultimate beneficiary is an Episcopal Church entity.
- How can we set-up a new fund?
Any church or Episcopal entity within the Commonwealth of Virginia (meaning all three dioceses) can establish an account with the Trustees. Churches wishing to do so should use a standard account form and are encouraged to include a vestry (or board) resolution establishing the account. Checks for deposit should be made payable to “Trustees of the Funds.”
Please send the account form, resolution and additional details regarding the fund, such as:
• Who can request withdrawals
• Any limitations on uses of the funds
• Should income be paid out annually or reinvested
Mail all information to:
Mrs. Laura Hicks, The Trustees of the Funds, P.O. Box 306, Manakin-Sabot, VA 23103
OR if using FedEx or other overnight service:
Mr. Michael Kerr, The Trustees of the Funds, 12291 River Road, Richmond, VA 23238
The Trustees of the Funds will send a receipt for the initial deposit providing the fund number and confirming the annual payout instructions.
If an individual wishes to establish a permanent fund (a “diocesan” fund) for any diocesan organization (church, school, conference center, camp, or the respective diocesan Office of the Bishop), they should contact Mr. Kerr directly by email or at 800-346-2373, x1020.
- Is there a minimum amount for participation in the Trustees of the Funds?
No, for the core and STAMP portfolios, any amount is welcomed for the benefit of an Episcopal Church institution.
The Gift Annuity Fund does have a minimum funding requirement of $5,000. It also has a maximum funding level of $100,000 at the present time.
- Is there a limit on the number of funds a church or organization can have?
No, if having more than one is of service to a church or church institution, then it is encouraged to take advantage of the fund-specific reporting in each portfolio.
- Can our parish designate the money deposited for a specific purpose?
Yes! One or more accounts can be set up for any church organization to reflect the various sources and intended uses of its assets. It is the responsibility of the vestry or board to ensure that the funds are used for the appropriate purpose upon the disbursement or withdrawal of the funds.
Setting up such a designated fund can better promote long-range planned giving efforts in the church by giving persons a chance to leave their permanent mark on the future of their church entity in the area most important to them. Many funds are designated for a specific purpose, such as music programs, educational scholarships, medical needs, etc.
All additions to such funds are acknowledged in writing. In the case of an individual making a donation, a charitable gift letter is sent to the donor in compliance with the Omnibus Budget Reconciliation Act of 1993 (OBRA93).
A sample codicil to a will can be found here.
A sample codicil cover letter can be found here.
- How do we send additional deposits?
Deposits to the TOTF can be made by check delivered to the offices of the Trustees of the Funds (P.O. Box 306, Manakin-Sabot, VA 23103) or by wire directly to SunTrust. All checks should be made payable to “Trustees of the Funds.” For wiring instructions, please contact Mrs. Laura Hicks by telephone 800-346-2373, x1040, or email firstname.lastname@example.org.
- Can donations of securities be made?
Yes, it is easy to do so, but please call the Mr. Kerr or Ms. Hicks to receive current instructions on process.
- How do we request a withdrawal or disbursement?
Each portfolio has its own form for doing so. Please see the forms tab for each. All requests for withdrawals must be received in writing (mail or scan/email). Mailed documents should be sent to the attention of Ms. Laura Hicks, The Trustees of the Funds, P.O. Box 306, Manakin-Sabot, VA 23103.
Requests are processed immediately and checks are received by the requestor within 5-7 business days. Please confirm to whom the check should be made payable, and the appropriate mailing address.
- Do the diocesan offices benefit in any way from managing such a service?
While the three dioceses do not receive any fees for this service, they do benefit in several ways.
First, over the past 100+ years, the three dioceses have received many generous bequests to benefit both diocesan and church functions. The diocesan offices have an obligation to the donative intent to be good stewards of these resources.
Second, in a similar way, each diocese benefits when its congregations and related organizations are financially strong. Having a stable and well-performing investment vehicle allows better fiscal planning and continuity of program development at the local level.
Finally, each diocese benefits by their congregations and organizations having a neutral investment vehicle to help ensure that local circumstances don’t play a role in endowment management or general investment decisions. By placing the investment with The Trustees of the Funds, investment professionals are free to attend church or serve an Episcopal Church board without the pressure or burden of personally managing the welfare of the investments. Having those persons available is a gift an organization should not take for granted.
- What is the difference between a 'diocesan' and a 'parish' fund?
There are over 100 “diocesan” funds and nearly 600 “parish” funds”. The distinction lies in where the ultimate control of the assets is held. Most of the “diocesan” funds are held for the benefit of a particular institution, not one of the diocesan offices, but the responsibility for the funds has been left to the diocesan level of authority (perhaps better said as “not church-level”) and the principal of many of these funds remains intact permanently. In addition, the diocesan funds are where funds are placed when they are invested by non-church organizations such as diocesan schools or related organizations, such as Shrine Mont, Stuart Hall School, the Diocesan Missionary Society, The Roslyn Conference Center or Virginia Diocesan Homes.
The “parish” funds were deposited by a vestry or church board and may be removed at any time. The responsibility for these funds remains at the local level and adherence to a donor’s desire is up to the vestry or board.
- Are the funds audited?
Yes. A copy of the Trustees of the Funds audit is included in the Journal of the Annual Council of the Diocese of Virginia. A PDF of the current audited financial statements can be found on the “Who We Are” page.
- How is reporting done?
Reporting is done through a monthly email that is issued about the 10th business day of each month for STAMP and about the 20th business day of each month for the core portfolio. TOTF can send the reporting for each portfolio to whomever needs to receive it at the local level.
Why the difference in reporting cycles? STAMP is designed to use only fully liquid underlying funds with easily tracked performance. SunTrust Bank has been extremely helpful in working to design the STAMP reporting process. The core portfolio has a mix of underlying fund managers which have immediate and delayed reporting processes which must be compiled over several weeks.
For each portfolio, each month provides a performance report showing the periodic results of the underlying investment managers and their respective benchmarks, as well as a report that shows the individual funds from participating Episcopal churches and institutions.
The Gift Annuity Fund will have very different reporting given the individual nature of this service.
- What is Time-Weighting of funds?
Specific to the management of the STAMP portfolio is the concept of time-weighting. This is possible through the specific fund accounting in use at SunTrust Bank, TOTF’s master custodian. This means that an individual account’s activity will be tracked from the date of investment or disbursement, rather than the core portfolio’s month-end unitization process.
In shorthand, if a church entity opens an account on the 15th of a month, SunTrust is able to track the specific gains/losses to that fund for the month from the 15th onward. Likewise, if a church entity adds to, or withdraws from, an account mid-month, the same process applies. In doing so, STAMP more closely tracks a funds true value. This process is possible due to the highly liquid nature of the underlying funds and the SunTrust Bank institutional trust office tracking software.
Asset Transfer Help
- DTC Eligible Securities – Please provide this information to your brokerage office
FFC SunTrust Bank a/c 11188
For the benefit of: (the Episcopal Church entity being supported)
- Physical Securities
Suntrust Banks, Inc.
Free Movement, Mail Coded 3132
15th Floor, Suite 1520
303 Peachtree Street, N.E.
Atlanta, GA 30308
*Reference Account Number & Account Name on the documentation accompanying the stock certificate (s) and include the Episcopal Church entity being supported
- Wire Instructions (Cash)
Suntrust Banks, Inc.
Attn: Gift Clearing
For further Credit to: 7013938 Diocese of Virginia Disbursement Account
For the benefit of: (the Episcopal Church entity being supported)
- Fed Items
FED: ABA #042000013
US Bank NA/1050
FFC SunTrust Bank a/c 11188
(SunTrust seven digit client account number); Account Name
For the benefit of: (the Episcopal Church entity being supported)
Planned Giving 101
- What is an endowment fund?
An endowment fund is an aggregation of money, investments, or property donated by individuals over time and structured to provide an ongoing source of support for ministry.
Church organizations should have sufficient money for emergencies before they create an endowment. In this summary, “church” is meant to represent any Episcopal Church institution within the Commonwealth of Virginia.
Key point to an endowment and managing it well: “The trustees of an endowment institution are the guardians of the future against the claims of the present. Their task is to preserve equity among generations,” said James Tobin of Yale University and the creator of the theory of Intergenerational equity. Deciding to start endowment is a delay of instant gratification. It’s planting the tree you may never sit under.
- What are the benefits of an endowment fund?
Endowed funds benefit a church in several ways. They often allow the organization to grow new or existing ministries that would otherwise strain already-limited resources. They may enhance or provide resources for music, education, youth ministry, Christian formation or perhaps to guarantee care and maintenance of buildings and facilities.
Endowment funds also can provide a long-term, stable source of support, especially during times of economic uncertainty or to offset temporary shortfalls in giving (loss of a major contributor).
- Don't endowment funds have to be used for special purposes?
There are two kinds of endowment:
- An unrestricted endowment is one in which the income may be used for any purpose without qualification.
- A restricted endowment is one in which the income may be used only for the purpose specified when the gift is made. This is sometimes referred to as donative intent.
- There are several basic types of assets in play when it comes to investment operations:
- Assets that have no restrictions put on them.
- “Designated” – Unrestricted assets that the vestry has set aside for a certain use
- Example of unrestricted designation: Property Reserve
- Designated uses can be changed by subsequent vestry/board action
- These are also known as “quasi-endowment”
- Temporarily Restricted
- Funds that are donor restricted for a specific use or for a specific time
- Gifts to a Capital Campaign is a classic example in church operations.
- Permanently Restricted
- Funds restricted by donors in perpetuity. Commonly known as endowments
- The Corpus remains intact in perpetuity. Earnings from endowments are considered temporarily restricted
- How does an endowment fund operate?
The endowment should be established with a set of policies that delineate who administers the endowment, how funds should be invested or managed, how distributions from the endowment are determined, what provisions are required for the invasion of principal, and how the endowment may be terminated, should that become necessary.
TOTF provides most of this operational function for participants.
- How does the church organization obtain endowment funds?
Bequests are by far the most common source. A special endowment campaign can also generate gifts and pledges for the endowment. A significant founding anniversary is such an opportunity. Finally, endowment funds may be raised through planned-giving programs. The core portfolio has always functioned as a perpetual pooled endowment fund. The Gift Annuity Fund should prove to be an excellent means of raising longer-term gifts while providing the donor an immediate benefit.
- Are there disadvantages to endowment funds?
There are times when congregations or other organizations become overly reliant on endowment income such that regular financial support consequently suffers. Other than in exceptional circumstances, endowment funds should not be used for ongoing, regularly-budgeted ministries. The overuse of endowment funds may indicate a failure on the part of leadership to treat annual giving as an essential part of Christian formation. There are many steps that a church or church organization may take to avoid such problems and maximize the rewards associated with developing and employing endowed funds.
- How does an organization get started?
Calling the Trustees of the Funds office is the good way to start in Virginia. While there are many similarities in starting endowments, each entity tends to have specific needs. Resources are available to assist you with endowment planning. The Gift Annuity Fund may be an especially important factor in helping members give in the long-term.
- Why is planned giving important?
Giving to the church isn’t ultimately about money: it’s about ministry. In order to expand its ministries, the church must develop more resources, financial and otherwise. Giving is also about a relationship with God—how people make space in their hearts and lives for spiritual growth. For many people, their most generous financial gift is the one they make at the conclusion of their life.
Planning an estate gift can reduce tax liability, now and in the future, to donors and donors’ heirs. For almost everyone, planned giving just makes sound financial sense. About 70% of Americans do not have a will. However, thinking about a planned gift may motivate a person to write a will.
In this country, a huge transfer of wealth is taking place as the first years of the “boomers” approach 70 years old, and most of the recent changes to the tax laws benefit the very wealthy and their heirs. It is uncertain whether the next generation will be as generous as this one; regardless, this is a time when leaders in the church should be very intentional about asking members to include local churches and other Episcopal Church organizations in their estates.
- What advice does TOTF offer to individuals regarding planned giving?
Consider what the Episcopal Church means to you—its importance in your life, to the community, and to the world. Your gifts to the church are a means of expressing your love for God and your gratitude for all that God has given you.
You might “endow your pledge” to your church, school or important Episcopal organization by leaving resources sufficient to yield the equivalent of your annual pledge as investment income in perpetuity.
- How will planned giving affect other fund-raising efforts?
Because the gifts being considered are deferred—part of an individual or family’s long-range planning—there is little impact on annual giving. In fact, many members who can no longer give large annual gifts will appreciate knowing that they can make a substantial gift at their death.
- Getting started on a planned giving campaign
- Documentation on how and why — make your case for support. Include structure on how gifts can and will be received/placed
- Organizational leadership should be at 100% giving before any public phase
- Quiet/public phases — it is best to have gifts from leadership and others in place during a quiet phase to launch a campaign in a position of strength
- “ABC” Society (a named legacy society can be very important)
- Pins/Plaque (visible thanks)
- Annual Dinner (visible thanks)
- This is an ongoing process, not a one-stop event, keep momentum strong and fresh!
- The necessary tools
- You’ll need resolutions, policies, and forms.
- Resolution of the Vestry/Board and Statement of Purpose
- Endowment resources empower ministry
- The more mission-oriented the endowment fund, the more additional gifts it will inspire
- The technical requirements for the resolution of the vestry/board are to name the fund, describe its purpose, name the initial committee members (as well as their terms and the process for rotation of members), officers, election procedures, the frequency of meetings, and reporting requirements.
- Record Keeping
- Maintaining professional standards cannot be overemphasized
- Confidentiality and commitments of donors are critical features
- Timely acknowledgment of all new gifts and commitments is essential
- Letters from the rector/chair/head as well as from the endowment committee chair.
- It should always be personal.
- Accurate lists should be maintained of everyone who has notified the church organization of some form of estate commitment
Please note that the Trustees of the Funds is a managed investment vehicle available for handling funds like church endowments in the three dioceses within Virginia. Naming the then-current Investment Policy Statement of the Trustees of the Funds can serve as a proxy “IPS” for a church or church organization.
Contact Michael Kerr at (804) 622-3186 or email@example.com for more information.