Effective July 1, 2007 – June 30, 2008
As donors to K-State, your gifts create a margin for excellence and sustain an environment where dreams come alive. We strive to offer choices that allow you to establish the kind of fund that most closely matches your philanthropic desires.
Here is a brief description of our three options. See our full distribution policy.
• $5,000 minimum contribution or $1,000 per year for five years
• 95 percent of the contribution is distributed to the purpose you specify.
• 5 percent of the contribution is made available to the designated college or program for the area of greatest need.
Expendable funds are available immediately for use by the designated college or department. Expendable contributions are invested in the expendable pool. Earnings are retained by the foundation to cover the expense of fund administration.
• $10,000 minimum contribution
• The principal is never invaded; only earnings are distributed.
• The distribution to purpose is adjusted annually for inflation, but is always between 3 and 5 percent of market value. Market value is the current worth of the fund.
• 0.25 percent of market value is made available to the designated college or program for the area of greatest need.
• 1.3 percent of market value is retained by the foundation for development and management expenses.
The inflation-based formula results in a smooth flow of income to the university. The formula adjusts each fiscal year based on inflation to maintain the purchasing power of your endowment.
When we receive your gift, it will be invested in the endowment pool on the first day of the upcoming quarter. The endowment pool operates much like a mutual fund; the endowed funds purchase shares in the pool at the share value on their day of purchase. The share value fluctuates with the value of the investments held in the pool. The cost of operating the pool is subtracted from the total market value of the pool.
• $25,000 minimum contribution
• Principal may be invaded and completely expended.
• 0.25 percent of market value is made available to the designated college or program for the area of greatest need.
• 1.3 percent of market value is retained by the foundation for development and management expenses.
• The donor may choose from three distribution options:
1) Fixed dollar option pays out in multiples of $500;
2) Fixed percentage option pays out 4, 6 or 8 percent of market value annually; or
3) Situational option pays out 50 or 100 percent of tuition and fees for the number of hours taken by an average full-time student.
Quasi-endowed contributions are received and invested in the same manner as permanently endowed contributions and share the same endowment pool operating costs. They differ from permanently endowed funds in that distributions may continue when a quasi-endowed fund is “underwater,” meaning that the market value is less than the original contributed value.
Quasi-endowed funds are appropriate for donors who prefer a more aggressive distribution rate and are not concerned about the fund existing in perpetuity. Quasi-endowed funds should, however, be established at a level where they can be expected to last for 10 years or more.
Our PDF fact sheet includes examples and worksheets for permanently endowed funds.