[Publib] Friends vs Foundations

[Robert L. Balliot]

Greetings Jim,

I set up a Foundation endowment for a Friends group through the Rhode
Island Foundation (RIF) several years ago.  The RIF
manages all of the funds for a 1% per year fee.  The funds are
averaged over three years as part of the larger collective funds
of RIF, which I think was about $400,000,000 at the time.  So,
the funds performed as well as the big money.   I recall that the averaged
return on the funds had never been below 9% and the Friends group
was allowed to expend 4.5% of the total in any given year.

The RIF could receive any sort of asset on behalf of the endowment -
land, stocks, bonds, cash - art - or anything of intrinsic value -
at the same fee of 1% per year.  So, the costs were extremely
low and the returns were very high.  After setting up the endowment,
the Friends would receive a check each year and decide on how to
spend it or reinvest it in the Foundation.

The Friends still fund-raised bringing in money for immediate needs.
However, with a Foundation behind them, they were also able to 
receive gifts from people who wanted their gift to have perpetuity.
The RIF has a great reputation for credibility too, which can
be quite comforting with all the shenanigans that can go on with
other people's money.  The RIF also filed all of the tax returns
related to the funds, which let Friends focus on fund raising
and expenditures. 

http://tiny.cc/Fs6jM

Perhaps there is a similar financial vehicle available to your
group in Colorado.  A Foundation and a Friends Group do not
need to be mutually exclusive.

*************************************************
Robert L. Balliot
Skype: RBalliot
Bristol, Rhode Island
http://oceanstatelibrarian.com/contact.htm
*************************************************
-----Original Message-----
From: publib-bounces at webjunction.org [mailto:publib-bounces at webjunction.org]
On Behalf Of jjbwest at comcast.net
Sent: Thursday, December 11, 2008 7:32 PM
To: publib at webjunction.org
Subject: [Publib] Friends vs Foundations

Hi Everyone,

I'm a Board member exploring the old Friends vs Foundations question.  I did
go through the archive, but didn't find what I wanted.

Are there any smaller libraries (serving a community with a population
around 25,000) that have combined their Friends with a new Foundation?  Or,
explored doing so and opted to keep them separate?

I'm looking for pro's and con's that I can report back to my Board and our
Friends.

Feel free to contact me off list.  I can post a summary of responses if
anyone's interested.

Thanks!

Jim Baillie
Lafayette (Colorado) Public Library Board
jjbwest at comcast.net
303-245-4616


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