We are a giving church, but one of the most common questions we hear in the Finance office is about the Mission Endowment Fund. To be clear, an endowment fund is restricted by state law and managed accordingly. Funds given to the endowment fund form the principle balance (the corpus) and are restricted. These funds cannot be used for any purpose unless the church goes into a bankruptcy.
People are often dismayed when they hear this, but an endowment of any kind, whether it is held by a trust, a non-profit, or a corporation must follow the same rules. The understanding of how funds are used when the endowment is created must be respected and followed. To make a change to this understanding requires an application to the State Attorney General.
So what’s the purpose of our Mission Endowment Fund? The intent is for the Mission Endowment Committee to distribute annual grants of the earnings (interest, dividends and market value changes) shown on the monthly Balance Sheet as ‘Endowment Fund Earnings.’ These grants are subject to the guidelines defined by the Constitution of Saint Peter Lutheran Evangelical Church (section C13.14.01).
There is also a statement in the constitution in section C5.05.01 that states, “The Mission Endowment Fund is established to ‘receive unrestricted gifts’ to enhance the mission outreach of Saint Peter.” This means the gifts are unrestricted by the donor. The same phrase and logic applies to our Memorial Fund. In the case of the both funds, donations cannot be designated to be used for any specific purpose.
Most endowment funds are by definition ‘permanently restricted’, but many are set up by one-time contributions or estate bequests, so the subject of ongoing donations is not applicable. Permanently restriction means that the corpus, or in our case, the donations to the Endowment Fund, cannot be distributed as grants. Only the earnings can be distributed. The sole purpose of the corpus is to generate the earnings.
The same phrase and logic applies to the Memorial Fund. Donations to the Memorial Fund are not permanently restricted and can be used at the discretion of the Memorial Fund Committee, subject to Council approval.
There are many different funds to give to at Saint Peter. In particular, the fund to pay tuition for our “adopted” kids in Haiti, or the Moritz Scholarship Fund that helps kids and adults with small grants to help further their education.
To review all of the giving options, navigate to the Give Plus page. Gifts to the General Fund are directed to support all of the church needs and activities.