TYPES OF FUNDS

Funds are generally set up as one of the following:

Unrestricted

These funds are typically created by visionary people with broad charitable interest. They offer current and future Foundation Boards maximum flexibility to meet the changing needs of our community, respond to emergencies and support the creation of innovative responses to community problems.

Donors can, if they choose, specify the fund become unrestricted after their deaths.

Field of Interest

This fund allows your client to support a particular broad charitable cause, such as education, the arts, health, youth or the disabled. The Foundation then seeks out worthy projects within this defined field of interest. Some donors who create field of interest funds during their lifetimes enjoy participating in the process of identifying worthy projects.

Designated

These funds are normally created to perpetually benefit one, or more, specific charities. Grants will be made in the name of the fund as long as the organization remains in operation and is consistent with its original charitable purpose.

If, over time, an agency benefiting from a designated fund closes or substantially alters its mission so that it no longer fits with the donor’s original intent, a future Foundation Board will seek out alternate beneficiaries to ensure the donor’s original charitable goals continue to be met.

Donor Advised

These funds are often an attractive alternative to the creation of a private foundation. Donors receive maximum tax deductibility for the original, and any subsequent, gifts, and retain the right to recommend charitable beneficiaries from the fund they establish. Grants are then made, in the name of the fund, to their recommended charities.

While legal control of the fund must rest with the Foundation, we welcome advice from donors which often alerts us to worthwhile projects and programs. Investments, paperwork, and grant monitoring are all handled by the Foundation with the donor free to just enjoy the fun of giving.

Scholarships

The Lubbock Area Foundation currently administers a number of different scholarships. Donors define the scholarship’s guidelines for candidate selection. Scholarships can benefit a particular educational institution or field of study or be very broad in giving students the option of choosing the school they want to attend.

Agency Endowments

This type of fund can be established by a non-profit organization with a transfer of its own funds to a designated fund within the Foundation or by gifts from individual donors for the benefit of the organization..

The Foundation views the management of agency endowments as a community service. This partnership offers better investment opportunities and reduced overhead through economies of scale, and every agency endowment, regardless of size enjoys professional management. Our Board protects an organization’s hard-earned endowment and insures it is always available to support its charitable mission.

"Pass-Through" Funds

As a service to donors, funds can be established that allow your client to make a gift to the Foundation which then “passes through” to their recommended charities. This may be appropriate when:

• Donor wants to take a tax deduction in one year, but make charitable gifts over several months or years
• Anonymity is important
• Unique property is used to make a gift
• Many gifts are planned for a single asset
• Other unusual circumstances.

The goal here is to provide a service. If you think the Foundation can help with a unique situation, please call us.