Types of Agency Funds

The following options are offered to nonprofit organizations for fund management:

Restricted Endowment

  • Consists of any gifts received by the Foundation for the benefit of the Agency without any specific instructions as to the distribution of income or principal, and those gifts designated by the donor as “endowment” gifts
  • Allows net income to be disbursed for broad general use and purposes of the Agency
  • Typical disbursement is done annually, with net income amount available after March 1 each year
  • The fund origination gift is not disturbed and remains as principal in the fund into perpetuity


  • Varies from “Restricted Endowment” only in relation to disbursement as resolved by Agency Board of Directors
  • In the event of extraordinary circumstances, the Agency may, by a pre-determined percent majority (e.g. unanimous, two-thirds, etc) resolution of its Board of Directors, request a distribution of a pre-determined percent of principal in any one year, up to a maximum of a pre-determined percent of Fund’s principal


  • Consists of those gifts received by the Foundation for the benefit of the Agency
  • Disbursements can be made from net income, net appreciation, or principal (a “non-endowed” fund)
  • Fund activity related to gifts and disbursements to remain minimal (not intended to become the Agency’s checking account)

Note: Net income = distribution amount calculated annually (calendar year) based on 4% of the preceding 12 quarters moving average balance of the Fund assets.

Contact us to learn more about fund management for your nonprofit. Phone (562) 435-9033.