Permanent Endowment Information

Is a permanent endowment with Central Montana Foundation the right move for your organization? Before you apply, please read the following information about the purpose and function of a permanent endowment. Click here for the permanent endowment application. Once received in the CMF office, your request will be voted upon at a regular meeting of the CMF Board of Directors. Contact CMF Executive Director Carrie Mantooth at 406.538.6130 for more information.

What is a permanent endowment fund?
A permanent endowment is a long-term fund held and managed by Central Montana Foundation on behalf of a not-for-profit or tax-exempt organization. The commonly accepted definition for permanent endowment is a fund which is kept in perpetuity where earnings provide regular operating support or support for a specific project for the benefit of the organization. The very word "endowment" encourages donors to believe that the fund is intended to exist forever.

Why build a permanent endowment?
Building a permanent endowment provides organizations with long-term sustainability and a foundation from which to grow, not contingent on the success of current or future fundraising efforts. Having an endowment fund provides a constant source of annual income while demonstrating security and long-range financial planning.

What are the benefits of placing assets with Central Montana Foundation?

Central Montana Foundation is a non-profit organization and our only business is philanthropy. The advantages of working with Central Montana Foundation include:

  • Participation in a diversified investment portfolio with total assets under management in excess of $22million (as of December 31, 2015).
  • Investment oversight from a dedicated investment committee comprised of financial and business professionals who have extensive experience in the investment and financial services industries.
  • All donations to CMF funds are tax deductible.
What is the minimum for establishing a permanent endowment?
The minimum for this type of fund is $1,000.  Subsequent gifts can be in any amount.

How does a permanent endowment fund grow?
Dividends and income earned from Central Montana Foundation’s pooled investments are paid proportionally on a monthly basis to all permanent endowments and deposited into the “available/spendable” portion of the endowment, while the “permanent/principal” remains untouched. Central Montana Foundation is unique in that it charges NO fees to establish or to administer funds held under its umbrella; all investment income is divided proportionately to each of the permanent endowment accounts.

How much can I withdraw from a permanent endowment?
You can spend the “available” balance; the “permanent” is held in perpetuity.

Does our organization need to have an investment policy? What if our board of directors has already adopted one?
No. Organizations with funds managed by Central Montana Foundation do not need an investment policy. As a component fund of the Central Montana Foundation, these funds are subject to our Investment Policy. This is a well thought out moderate risk investment strategy with a goal of relatively stable returns over the longer term, with a reduced potential of negative returns in any given year.

What happens to our endowment if our organization goes out of existence?
In order to preserve donor intent, the charitable earnings will be redirected by the Central Montana Foundation’s Board of Directors to the most similar cause that can be found.

What are some of the considerations before deciding to partner with Central Montana Foundation?
Considerations include the size of the annual operating budget, scope of the mission, capacity of staff and Board, and age of the organization. Many organizations find it advantageous to work with Central Montana Foundation because they benefit from the instant credibility that comes with partnering with one of Montana’s most respected community foundation organizations.

In the case of an emergency, can we get our money back?
Endowment funds provide a permanent source of revenue. Funds should not be committed to endowment that will be needed for operating expenses.