The Trinidad State Educational Foundation
Sharing the Vision, Securing the Future.
Investment Policy of Trinidad State Junior College Educational Foundation
Non-Title III Challenge Grant Endowment Funds
As stated in the Trinidad State Junior College Educational Foundation’s corporate charter, the purpose of the Foundation is to receive, hold, invest, administer, pay out and distribute all manner of funds, money, property and things of value made, donated, contributed, delivered, devised, bequeathed or otherwise transferred or communicated to the corporation from donors wishing to benefit Trinidad State Junior College.
The intent of this document is to establish policy and guidelines which will provide for the maintenance and enhancement of Foundation assets. This document will be reviewed as needed to reflect changes in both the financial markets and needs of the Foundation in support of the College.
This Investment Policy of the Trinidad State Junior College Educational Foundation shall provide guidelines for the management of assets in the Endowment Funds created through fundraising efforts, separate from the Title III, Challenge Grant Endowment Fund.
The purpose of the Investment Policy is to assist the Board of Directors in effectively supervising and monitoring its investment activities; and to provide guidance to investment managers employed to manage its assets on behalf of the Board. It is set forth by the Board in order to advise all concerned of their legal and fiduciary responsibilities.
The Board of Directors shall empower an Investment Committee to invest, manage, direct and monitor funds received as a result of fundraising efforts for the benefit of the current and future generations who are the ultimate beneficiaries of the Foundation.
The Investment Committee shall carry out the Investment Policies of the Foundation. Committee members shall follow the Prudent Expert Role which states a fiduciary shall manage the portfolio “with care, skill, prudence, and diligence, under circumstances then prevailing, and that a prudent person acting in a like capacity and familiar which such matters would use in the conduct of an enterprise of like character and like aims.” The Investment Committee shall meet no less than semi-annually and will report to the Board of Directors. The Board of Directors retains ultimate control of and responsibility for all investment activity.
The Foundation’s assets exist to provide long-term support to Trinidad State Junior College. Accordingly, the objective of the Investment Committee is to provide direction for the investment of the financial assets of the Foundation. The Investment Committee will consist of not more than seven (7) individuals, the President, the Director of Development and the Chief Financial Officer of Trinidad State Junior College and not more than four (4) individuals specifically designated by the Foundation Board of Directors. This Investment Committee is charged with the following responsibilities:
- To establish and maintain policies and guidelines for the receiving and investment of Foundation assets.
- To determine the appropriate asset allocation among these assets.
- To provide a system for monitoring the returns on these assets, and to review the performance of these assets.
- To hire and dismiss investment managers as needed.
- To report to the Foundation Board of Directors.
The investment objective is to achieve a total return including appreciation which will satisfy the current financial needs of the various endowment funds, protect and increase their long-term inflation adjusted value, and minimize short-run volatility.
To meet this broad objective, the specific performance objective is to attain, within acceptable risk levels, an average annual total return that MEETS OR EXCEEDS THE SUM OF THE FOUNDATION’S SPENDING (DISTRIBUTION) RATE plus inflation plus investment management and related fees.
The Investment Committee has the authority to retain specialists as necessary to assist it in evaluating investment and asset management options and strategies. The Investment Committee is authorized to select investment managers to invest and manage the assets of the Foundation. Investment managers shall be selected from established and financially sound organizations that have a proven and demonstrated record in managing similar funds or assets. Selection of managers will depend upon factors established by the Investment Committee and will be consistent with the Foundation’s investment philosophy and objectives, donor restrictions and such federal and state restrictions as applicable.
- Restricted – Funds will be distributed from the Foundation’s Operating Fund to the appropriate College account upon their receipt for utilization by the benefiting program. Those funds not transferred but retained at the Foundation will continue to be held in interest bearing accounts until further distribution is required or requested. Any income earned from current funds will become part of the Operating Fund.
- Unrestricted – Funds contributed for current unrestricted needs will be distributed to the appropriate College account as identified through a committee process established by the College, subject to approval by the College President, whereby recommendations are received by the TSJC Foundation Board. These funds will be directed to the area(s) receiving final approval of the Foundation Board in consultation with the College.
- Restricted – Funds will be spent as available from proceeds of the investment of the corpus. These funds will be spent in accordance with the spending policy and the written donor/Foundation endowment agreement.
- Unrestricted– Funds will be spent as proceeds from the investment of the corpus are realized. These funds will be directed to the area of greatest need as identified through a committee process established by the College, subject to approval by the College President, whereby recommendations are received by the TSJC Foundation Board. These funds will be directed to the area(s) receiving final approval of the Foundation Board in consultation with the College.
It is the policy of the Board of Directors to pay 5% of the ending balance of the endowment fund at year’s end, average over the past three (3) years. The Distribution (Spending) Policy should take into account any rebalancing needs to the Foundation’s portfolio. Distributions can be paid from interest income, dividends, and capital gains as the Investment Committee deems appropriate. At no time shall the corpus of an endowed fund be spent. The corpus is defined as that amount originally gifted to the Foundation by a donor, and excludes any interest, dividends, or appreciation of the originally gifted amount.
This statement of Investment Policy and objectives may be altered or amended at any time by the Investment Committee. Any modifications are subject to the final approval of the Foundation’s Board of Directors.
The Foundation is committed to doing all that it can to ensure, in perpetuity, a reliable and secure source of funds for Trinidad State Junior College’s programs and priorities.