Endowment Resolution and Investment Policy

RESOLUTION CONCERNING THE ESTABLISHMENT OF AN ENDOWMENT AND THE FUNDING OF SAID ENDOWMENT FOR THE BENEFIT OF THE DOBBS FERRY PUBLIC LIBRARY

 

 

The Friends of the Dobbs Ferry Library, having previously established an endowment on July xx, 2007 (the “Endowment”) the proceeds from which shall be used to supplement and enhance programs and services offered by the Dobbs Ferry Library as a way of benefiting the larger Dobbs Ferry community, now resolve as follows with respect to the Endowment: 

 

1.  OBJECTIVE AND PURPOSE OF THE ENDOWMENT FUND.

 

All previous documents and resolutions concerning the Endowment are hereby amended and superseded through this resolution in order to more fully effect the intent and purpose of the Endowment.

 

2.  INITIAL FUNDING AND USE OF ENDOWMENT FUNDS

 

Funds contained in the Endowment shall be referred to as “Endowment Fund.”  The Friends of the Dobbs Ferry Library shall fund the Endowment in the amount of $130,000.00 (the “Initial Funding”).  The Finance Committee shall oversee the Endowment Fund with the purpose of increasing the principal in accordance with the Investment Policy of the Friends.  The Endowment Fund shall not decrease below the Initial Funding, except to the extent such decrease is as a result of a decrease in the value of investments comprising the Endowment Fund.  For as long as the Endowment Fund is at least at the Initial Funding level, up to 80% of the annual earnings of the Fund shall be available to the Executive Board for programs and other projects sponsored by the Friends, including projects to increase donations to the Fund. 

 

3. DUTIES OF THE FINANCE COMMITTEE

The Finance Committee shall perform the following duties:  (a.) recommend how the Initial Funding and any other funding made in to the Endowment shall be invested consistent with the Investment Policy:; (b.) review and evaluate the performance of the Fund and any investment advisor; and (c.) make annual distributions from the Fund to the Friends consistent with this Resolution.  For purposes of subsection (c) of this Paragraph 3, the Finance Committee shall, no later than 45 days prior to end of the fiscal year of the Friends of the Dobbs Ferry Library, inform the Executive Board of the dollar amount that may be available for programs and other projects during the upcoming Fiscal Year.  Said dollar amount shall be calculated by the Finance Committee using the statements of account for the period ending the last day of the third quarter of the fiscal year.  Subject to the terms and provisions of this Resolution, and taking into account the recommendations of the Finance Committee, the Executive Board shall determine the specific amount of annual earnings from the Endowment Funds that shall be applied to the Friends’ annual budget..  

 

4.  ADDITIONAL FUNDING FOR THE ENDOWMENT

 

The Friends of the Dobbs Ferry Library shall provide information to potential donors about the existence and goals of the Endowment.  Donor contributions that are designated specifically for the Endowment shall be deposited in the Endowment Fund upon receipt.  At the Annual Meeting of the Friends of the Dobbs Ferry Library, the Executive Board may, at its discretion, recommend that additional funds from operations be placed in the Fund.  Such recommendations shall be voted on and ratified according to the By-Laws of the Friends.

 

5. FINANCIAL REPORTING

The Treasurer of the Friends shall be responsible for the safekeeping, management, investment and transfer of all funds and properties comprising the Endowment Fund.  The Treasurer shall present a quarterly financial report to the Executive Board on the status of the Endowment Fund and shall present a report on the status of the Endowment Fund to the Friends’ membership at the Annual Meeting.  In addition to these duties, and overseeing the Finance Committee, the Treasure may assume other duties related to the Endowment Fund as determined by the Executive Board.

6. CONSOLIDATION or MERGER

If at any time, the Friends of the Dobbs Ferry Library are lawfully merged or consolidated with any other nonprofit organization, all of the provisions herein with respect to the Endowment Fund shall be deemed to have been made for and in behalf of such merged or consolidated organization, which shall be entitled to receive all of the benefits of said Fund, and shall be obligated to administer the same in all respects in accordance with the terms thereof.

7. DISSOLUTION

In the event of the dissolution of the Friends of the Dobbs Ferry Library and in the absence of an Executive Board, the Finance Committee shall be entitled to disburse the funds in the Endowment as they choose, to another 501(c)(3) corporation that benefits and/or supports programs or services for the Dobbs Ferry Library or that otherwise accomplishes the objectives set forth herein.

8. AMENDMENT PROCEDURE

Provisions of this Resolution establishing guidelines for the Endowment Fund may be amended as necessary by a two-thirds majority vote of the membership at Annual Meeting of the Friends, or at such other general meeting as the Executive Board may see fit to call from time to time.  The Executive Board shall give a 30-day written notice to all members of any such meeting and proposed action as stated in the By-Laws.

 

 

 INVESTMENT POLICY

 

SCOPE

 

This Policy establishes rules for the investment of all funds held by the Corporation.

 

OBJECTIVES

 

1. Safety of principal is the foremost objective followed by liquidity and yield. Each investment transaction shall seek to first ensure that capital losses are avoided, whether they be from securities defaults or erosion of market value.

 

2. Investment decisions should not incur unreasonable risks in order to obtain current investment income.

 

3. The investment portfolio shall remain sufficiently liquid to meet all operating requirements which might be reasonably anticipated.

 

4. Investments will be diversified to avoid incurring unreasonable and avoidable risks regarding specific security types or individual financial institutions.

 

5. Management of the investment portfolio will specifically avoid any purchase of investments, or any investment practices or procedures, not specifically authorized under the terms of this document.

 

INVESTMENT STRATEGY

 

Investments will be diversified among a variety of investment vehicles. Protection of the portfolio's principal is of primary concern; however, it is recognized that in a rising interest rate environment unrealized losses will occur, just as unrealized gains will occur during a period of falling interest rates. Regardless, the investment portfolio should always be structured in a manner to insure that potential unrealized losses are not material relative to the interest rate environment at any time.

 

AUTHORIZED INVESTMENTS

 

The following instruments are allowed by law; however, the use of any of these instruments must be consistent with the Investment Strategy described above.

 

The Corporation may invest in the following:

 

(1) obligations of the United States or its agencies and instrumentalities;

 

(2) direct obligations of the State of New York or its agencies;

 

(3) other obligations, the principal of and interest on which are unconditionally guaranteed or insured by, or backed by the full faith and credit of, the State of New York or the United States or its agencies and instrumentalities; interest only (IO's), principal only (PO's), and inverse floaters (IF's) are specifically excluded;

 

(4) obligations of states, agencies, counties, cities and other political subdivisions of any state having been rated as to investment quality by a nationally recognized investment rating firm and having received a rating of not less than A or its equivalent;

 

(5) certificates of deposit issued by state and national banks or by savings banks doing business in the State of New York that are:

 

(A) guaranteed or insured by the Federal Deposit Insurance Corporation, or its successor; or

 

(B) secured by obligations that are described (1)-(4) above which are intended to include all direct federal agency or instrumentality issued mortgage backed securities that have a market value of not less than the principal amount of the certificates or in any other manner and amount provided by law for deposits of the investing entities;

 

(6) commercial paper with a stated maturity of 270 days or less from the date of its issuance that either:

 

(A) is rated not less than A-l, P-l, or the equivalent by at least two nationally recognized credit rating agencies; or

 

(B) is rated at least A-l, P-a, or the equivalent by at least one nationally recognized credit rating agency and is fully secured by an irrevocable letter of credit issued by a bank organized and existing under the laws of the United States or any state thereof;

 

(7) domestic and international equities, and non-US debt instruments;

 

(8) negotiable certificates of deposit issued by a bank that has a certificate of deposit rating of at least l or the equivalent by a nationally recognized credit rating agency or that is associated with a holding company having a commercial paper rating of at least A-l, P-l, or the equivalent by a nationally recognized credit rating agency;

 

(9) corporate bonds, debentures, or similar debt obligations rated by a nationally recognized investment rating firm in one of the two highest long-term rating categories, without regard to gradations within those categories;

 

(10) No-load money market mutual fund that is regulated by the federal Securities and Exchange Commission with a dollar-weighted average stated maturity of 90 days or less and whose investment objectives include seeking to maintain a stable net asset value of $l per share.