What if the endowment fund grows in value over time?
If an endowment appreciates, the law permits a board to spend the appreciated value, net of expenses, to the extent that it is prudent to do so. This determination must be made on a fund-by-fund basis. In other words, appreciation in one endowment fund may not be used to offset depreciation in another endowment fund. See “Advice for Not-For-Profit Corporations on the Appropriation of Endowment Fund Appreciation,” available on the Charities Bureau website (http://www.ag.ny.gov/bureaus/charities/pdfs/endowment.pdf).
Related Questions
- If the Foundation successfully establishes an endowment fund to take care of the Park will the town cease to support the Park financially?
- Who do I call to find out endowment principal, market value, or projected income for an endowment fund?
- What is the difference between an endowment fund book value versus market value?
