SPF Endowment Policy

This Seattle Polish Foundation (“SPF”) Endowment Policy (“Endowment Policy”), dated 12/10/2022, governs the management, investment, transfers, and distributions from, and direct donations into the SPF Endowment Fund (“Endowment Fund”), and is adopted by the SPF Board of Directors as of 12/10/2022.
Purpose Of the Policy

The purpose of this Endowment Policy is to establish the Endowment Fund to support the SPF’s long-term mission and grant making possibilities and to provide guidance related to spending of funds contributed to the Endowment Fund and/or, donations into the Endowment Fund, as the case may be.

I. DEFINITION OF TERMS

  1. One separate account will be established by the SPF.
  2. One (unrestricted) Endowment Fund (“Endowment Fund”) will be established by SPF managed and invested with TBD. and intended to be for the long-term support of the SPF. An Endowment is a fund held by the SPF exclusively for charitable purposes that, under the terms of a gift instrument, is not wholly expendable by the SPF on a current basis, as defined under Revised Code of Washington Section 24.55.010(2), as amended.

II. OPERATION OF THE FUNDS

  1. Except as modified by the terms in this document, the Funds will be administered, managed, and operated under the supervision of the Board of Directors. However, the Board of Directors may delegate its duties to any committee created by, or person serving on, the Board of Directors. The Treasurer shall provide the Board of Directors with an [annual] report of the income/loss and status of the Funds.

III. MINIMUM

  1. There shall be no minimum amount necessary to establish the Funds or for additions be made to the Funds. If a donor pledges an amount designated into the Endowment Fund, any such donation shall be made without the needed approval of a majority vote of the Board of Directors.

IV. DISTRIBUTIONS

  1. . Unless otherwise designated, distributions from the Funds shall be unrestricted and used for grant to further the mission of the SPF.
  2. Distributions shall not be made from the endowment principal, only from the endowment income.
  3. [At the end of each quarter or year], the [President] can recommend to the Board of Directors, an amount to be distributed out of the Endowment Fund to the SPF’s general operating account [or such other applicable account]. Any other Directors may also recommend to the Board of Directors proposals for any amount to be distributed out of the Endowment Fund to the SPF’s general operating account [or such other applicable account]. Each recommendation shall outline the use of distributions.
  4. Distributions shall not be made from the endowment principal, only from the endowment income.
  5. Distributions authorized by the Board of Directors may be made at any time during a fiscal year.
  6. In deciding to spend any Fund income, the SPF shall act in good faith, with the care that an ordinarily prudent person in a like position would exercise under similar circumstances, and shall consider, if relevant, the following factors:
  1. The duration and preservation of the Fund.
  2. The purposes of the SPF and the Fund.
  3. General economic conditions.
  4. The possible effect of inflation or deflation.
  5. The expected total return from income and the appreciation of investments.
  6. Other resources of the SPF
  7. The investment policy objective of the SPF is set forth in Article VIII below.

V. DESIGNATION

  1. All contributions to the Fund are received as contributions to such Fund unless otherwise specified by the donor. A donor acknowledgement meeting the requirements of Section 170(f)(8) the Internal Revenue Code of 1986, as amended, will be issued to the donor. Contributions MUST be designated to such Fund by the donor prior to the funds being added to such Fund. Absence of a donor designation does not mean that the contribution can be directed to the Endowment Fund. Otherwise, unrestricted donor contributions cannot be restricted by the Board of Directors.

VI. VARIANCE POWER

  1. The SPF Board of Directors shall have the power to modify any restriction or condition imposed by a donor on the distribution of assets or reject the donation if, in the sole judgment of the Board of Directors, such restriction or condition becomes unlawful, impractical, impossible to achieve, wasteful or inconsistent with the mission of the SPF , and such modification would more effectively serve the mission of the SPF taking into consideration the wishes of the donor. In the unlikely event that this becomes necessary, the donor(s) will be notified and provided with 30 days’ notice to object to any such modification. The absence of any explicit objection to such modification will be deemed approval on the date following 60 days from the date of notice to the donor. The Board does reserve the right to refuse to accept such donations. Any such modifications shall be made in accordance with the Revised Code of Washington Sections 24.55.045 and 24.03A.190, as amended. For the avoidance of doubt, the SPF Board of Directors’ variance power under this Article VII shall apply to a gift only to the extent such variance power is expressly adopted by the applicable donor in their gift documents.

VII. INVESTMENT OF FUNDS

  1. The SPF Board of Directors shall oversee investment of the Funds. The SPF Board of Directors shall develop and revise, when appropriate, management objectives for the Funds to accomplish the following:
  2. . [Preserve and develop real (inflation-adjusted) purchasing power with consistent (in real terms) stream of earnings, in line with spending needs. The net income may be distributed annually from the Fund as discussed earlier.
  3. The investment policy for SPF is hereby adopted by the Board of Directors. The SPF Board of Directors shall supervise the administration of the Funds’ portfolios, in accordance with the policy as adopted and amended from time to time. The policy shall be reviewed at least annually by the SPF Board of Directors and revised as necessary by a majority vote of the Board of Directors. The SPF Board of Directors may select outside investment managers to administer the Fund portfolios. The Board of Directors agrees that it is important to follow coordinated policies regarding spending and investments of the Funds that will protect the Funds’ principal and produce reasonable total returns, and that will support the SPF’s operations. Any assets in this fund should be protected by a corresponding trailing stop limit transaction that will force the sale of an asset if its value drops by 10%.
  4. The primary objective will be total asset return, including income, appreciation, and protection of principal. In managing and investing the Funds, the SPF shall act in good faith, with the care, skill, and diligence that an ordinarily prudent person in the capacity of investing endowment monies would undertake under similar. circumstances, and shall consider, if relevant, the following factors:
  1. General economic conditions.
  2. The possible effect of inflation or deflation.
  3. The expected tax consequences, if any, of investment decisions or strategies.
  4. The role that each investment or course of action plays within the overall investment portfolio of the Fund.
  5. The expected total return from income and the appreciation of investments.
  6. Other resources of the institution.
  7. The needs of the institution and the institutional fund to make distributions and to preserve capital; and
  8. An asset’s special relationship or special value, if any, to the charitable purposes of the institution.

VIII. REPORTING

  1. The Treasurer shall produce and publish a financial statement from each the Fund annually for the annual meeting or upon request from any Director. These financial statements shall be presented in accordance with Generally Accepted Accounting Principles (GAAP).

IX. FEES & EXPENSES

  1. Administrative: To assist the SPF in funding each the Fund’s administrative costs, the Board of Directors may authorize to annually transfer to its unrestricted general operating account an amount necessary to cover such portion of SPF’s administrative expenses attributable to the administration of such the Fund. Administrative fees will be calculated as of December 31 at the end of each fiscal year commencing with the fiscal year beginning January 1, 2023.
  2. Investment: In addition to any amounts transferred annually to the unrestricted general operating account, each Fund shall be charged for any out-of-pocket expenses (such as third-party investment management fees or other handling fees) incurred directly by such Fund.
  3. Other Expenses: The Funds may require additional professional services and administrative support from time to time which are over and above normal administrative costs. The Fund shall be charged for any out-of-pocket expenses incurred directly by it. Such additional costs may include consulting, legal, accounting, marketing and other fees for professional services incurred to support such Fund, or the processing of an unusually large number of disbursements or gifts.

X. SPF TERMINATION

  1. If the SPF ceases to exist with no successor, or if the SPF ceases to qualify as a public charity as defined in Section 170(b)(1)(A) of the Internal Revenue Code, and such condition is not cured within 30 days, then the Board of Directors shall first pay or make provision for the payment of all liabilities of each Fund. The Board of Directors shall then, to the extent permissible, transfer all of the remaining assets of each Fund to one or more other organizations that qualify as exempt organizations under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, with a similar mission to that of the SPF, as selected by the Board of Directors and in accordance with any current federal, state and local laws as in effect at the time of distribution.

XI. INTERPRETATION

  1. The Board of Directors shall have the exclusive right to interpret and construe this Endowment Policy and to decide any and all such questions arising under this Endowment Policy or in connection with its administration, including, without limitation, the right to remedy all possible ambiguities, inconsistencies and omissions. Any such determination by the Board of Directors made in good faith shall be conclusive and binding on all persons. The validity of this Endowment Policy or any of its provisions shall be determined under and construed according to the laws of the State of Washington and, where applicable, the SPF’s governing documents. Although intended to fully comply with all applicable laws, if any provision of this Endowment Policy shall be held illegal or invalid for any reason, the remaining provisions shall not be affected, and the illegal or invalid portion shall be deemed to be omitted.

XII. AMENDMENT

  1. To enable the practical and reasonable administration of the Fund in accordance with donor intent under changing circumstances, to remedy omissions errors or ambiguities in this Endowment Policy, to provide for the more efficient administration of the Funds, or to implement any other modification the Board of Directors determines necessary, the Board of Directors shall have the power to amend this Endowment Policy at any time with the approval of a majority vote by the SPFs Board of Directors, provided that no such amendment shall jeopardize the tax-exempt status of the SPF or cause any contribution to the SPF or the Funds to be nondeductible for federal income, estate or gift tax purposes.

XIII. AGENTS

  1. The Board of Directors may employ external agents as the Board of Directors thinks necessary or desirable for the proper management and investment of the Funds. The Board of Directors shall not be liable for the decisions or actions by any agent or attorney selected, if the Board of Directors acted in good faith and with the care that an ordinarily prudent person in a like position would exercise in selecting, establishing the scope and terms of the agent’s actions consistent with the purposes of the SPF and the Funds, and periodically reviewing the actions of such agent for compliance with such scope.

XIV. CHOICE OF LAW

This Endowment Policy shall be governed by the laws of the State of Washington.

Approved by a majority vote of the SPF Board of Directors as of:
By: John Golubiec 12/10/2022
President of the Seattle Polish Foundation