Endowment Fund Management

Section 1

Gifts to the Central Arkansas Library System that have no investment restrictions are to be deposited in one or more of the CALS Endowment Accounts. Those accounts are defined as Mutual Funds, Certificates of Deposit, Government Obligations, and the Miscellaneous Endowment Fund Checking Account.

Section 2

It is the intent of CALS to manage its endowment funds to insure that earnings are maximized within the constraints of acceptable risks. It is also the intent of CALS to invest for the long term, which means that CALS recognizes that short-term market conditions may occasionally result in a decrease in the value of one or more accounts. Investment policies shall be established by a board appointed Investment Committee and implemented by the Director.

Section 3

It is the policy of CALS to invest its gifts in a balanced portfolio which, depending on market conditions, may include Aggressive Growth Funds, Growth Funds, Growth and Income Funds, Balanced Funds, Bond Funds, International Funds, C.D.s, government obligations, and Money Market Funds.

Section 4

When selecting Mutual Funds, the Investment Committee shall take into consideration the past performance of the funds and shall select funds which are rated three-star or better in the current edition of MORNINGSTAR MUTUAL FUNDS. (Funds that fall below the three-star rating after they are purchased shall be reviewed and kept or sold as conditions warrant.)

Section 5

Any time funds are sold and/or transferred the Director shall provide the Board Treasurer with a copy of that transaction. Quarterly reports shall be provided to the Board of Trustees.

Section 6

The board may authorize the Investment Committee to invest Endowment Funds in real estate. Rents from any properties under CALS control shall be deposited in the CALS Endowment Accounts. Profits from the sale of any properties purchased with Endowment Funds shall be deposited in the CALS Endowment Accounts.

Policy Information

Board Policy #204
Board Approval: 09/22/93
Revision: 12/27/94, 04/25/02
Director’s Recommendation: 09/22/93
Legal Advice: 06/15/99