The Holly Endowment Fund
The Holly Endowment Fund is a “bank account” which contains an amount of money that was donated by Holly patrons & supporters to establish and maintain a pool of assets to be used exclusively for the long term benefit of the Holly theater. The assets are managed by an Endowment Fund Board that is separate and distinct from the management of the Holly Theater. Every year the Endowment Fund makes a contribution to the Holly Theater that consists of some portion of the interest generated by the fund during the year. The principal portion of the endowment is never touched. The Holly Theater has an annual obligation to host a fundraising event for the Endowment to help continue to grow the principal amount of the endowment.
Endowment Fund Mission Statement
The mission of The Holly Theatre Community Center Endowment Fund Board is to be good stewards of the assets entrusted to this fund. This Board is dedicated to the continuance and enhancement of The Holly Theatre Community Center, Inc. by
distributing funds to the Holly Theatre Community Center’s General Fund annually from the portfolio. The funds that will be considered for distribution are: all interest earned from the Fund (after expenses).
Statement of Objectives
The objectives of the Board have been established in conjunction with a comprehensive review of current and projected financial requirements. The objectives are:
1. Help maintain the level of services and programs offered currently by the Holly Theatre Community Center, Inc.
2. Maximize return within reasonable and prudent levels of risk.
3. Make distributions every February. We may not maintain a constant funding-support-ratio amount to be distributed each year. The Board will distribute interest gained on the Portfolio each year from January through December. An audit of the balance of all accounts will be made on the close of business day each year at the end of December to determine the account value and the interest made the current year will be allocated for distribution.
4. Maintain an appropriate asset allocation based on a total return policy that is compatible with a flexible spending policy, while still having the potential to produce positive real returns.
Perhaps the most confusing term in the fund raising universe is “endowment.” It seems there are many perceptions and definitions for the word, and just as many myths! The following addresses a few of them:
Myth: Organizations with endowments are “rich.”
Reality: Endowment funds are restricted to preserve the principal sum in perpetuity, which provides a stable basis that protects the effectiveness of current and future gifts to any size organization.
Myth: Endowment funds can be accessed to pay the operating expenses if the Holly Board deems it necessary.
Reality: The Holly Endowment is incorporated separately from the Theatre and administered by its own board of
directors. The principal is invested and only the fund’s earnings can be expended; earned funds are directed to the Holly each year after specific conditions have been met.
Myth: Endowment funds can be used as loan collateral and would be lost in case of a default.
Reality: Banks would not be able to access this separate, restricted fund; as a result, endowment funds do not assist in financing.
Myth: By asking for endowment gifts, we are “robbing Peter to pay Paul.”
Reality: Annual gifts, “Raise the Roof “campaign gifts, and endowment gifts each have a different but equally vital purpose: The former two types of gifts support the staging of shows and physical repairs and improvements of the theater. In case of the endowment—the secured fund whose principal will not be invaded provides a measure of long-term financial