Purpose | Administration | Investment Policy | Stewardship of Endowed Funds | 

Endowed funds are created from donor gifts that are accepted with the stipulation that the donor intends the fund to exist in perpetuity. Gifts to the endowment are pooled together and invested for the long term as to generate a stream of income and to maintain the buying power of the fund. The UMBF Board of Trustees has set $25,000 as the minimum funding level for an endowment, although Schools may set higher funding levels for specific purposes (e.g., endowed professorships). See the Foundation’s policy minimums below: 

Once the fund has reached the required minimum funding level and has been invested for an appropriate period—at least three months—it is eligible for spendable income in the following fiscal year. Endowments are allowed a five-year period to achieve the required minimum funding level. If at the end of five years the fund has not reached the required minimum funding level, UMBF will notify the appropriate Chief Development Officer (CDO) that the funding period has expired. The CDO (or designated Development Officer) should then contact the primary donor(s), if possible, to ascertain their intention. The Fund may, at the Board’s discretion in consultation with the Dean of the School, be endowed at the amount contributed; combined with another endowment with a similar purpose; or established as a non-endowed fund to be spent as closely as possible to the Donor’s intended purpose. If warranted and agreed to by the President and/or Treasurer of UMBF, the funding period may be extended up to two additional years.  

If donor preference is not obtained and/or the funding period is not extended, the UMBF Board of Trustees, after consultation with the President of UMBF and the Dean of the School, will determine whether the total amount donated will be combined in a general endowment fund or revert to current use to be expended for the original donated purpose.  

The Board reserves the right to modify the name of the Fund pursuant to the UMB Policy on the Naming of Facilities, Programs, Interior and Exterior Spaces, and Funds (VI-4.00).  

Information about specific accounts is made available to donors, account administrators, Deans, UMB Foundation staff, and external and internal auditors. Those responsible for administering, or overseeing the administration of, accounts should understand that their responsibility is a key element of donor stewardship as it relates to reassuring our donors that their gifts are being used as intended. Specific responsibilities are ensuring that gifts are posted to accounts timely and accurately, disbursement requests from an account match the purpose defined in the account agreement or MOU, and available spendable income is used in full to support the students, faculty, or programs defined in the account agreement or MOU.  

UMBF endowed funds are invested and managed in accordance with a contract with the University System of Maryland Foundation, Inc. (USMF). Endowed funds are invested for the long term in a diversified portfolio that is managed by investment firms chosen by the USMF Investment Committee for their experience, expertise, and performance effectiveness. An asset mix is selected with the objective of earning a total return that will be adequate to cover inflation, fees, and spending. The target asset allocation is closely monitored and adjusted as necessary by the USMF Investment Committee. The Committee’s intent is to manage the endowment assets in accordance with these principles, regardless of cyclical ebbs and flows in the capital markets, and this documentation of these principles is intended to ensure continuity of purpose and implementation regardless of changes in the composition of the Committee. The UMSF Investment Policy statement outlines the overall philosophy that guides the USMF Investment Committee, in-house staff, and hired investment managers to ensure the exercise of prudence and appropriate care in managing and investing our assets in accordance with the Uniform Prudent Management of Institutional Funds Act (UPMIFA). 

Donors have the right to expect that the UMB Foundation will be a good steward— that it will be accurate and truthful, both in presenting the need for current gifts and in reporting the use of major gifts, particularly endowments, entrusted to the Foundation’s care.  

To execute this stewardship requirement, UMBF will send endowment reports to donors annually. These reports include financial information about the endowment investment portfolio and fund performance (market value, distributions/spendable income, etc.) and may include information on how distributions were spent. 

For assistance with establishing an endowed fund, drafting an MOU, or any other endowment related questions, contact the Office of Gift Administration (GiftAdmin@umaryland.edu).