An article published Feb. 9 in the Eureka Springs Independent, noted that about a decade ago, two generous Hurricane Katrina refugees who had been helped by Flint Street Fellowship left their life savings to FSF.
“Other gifts brought total assets to about $347,000 today,” the story said. “Over the years there has been some controversy about how much the FSF needs to keep in reserve and how much should be spent to help those in immediate need.”
Ben Helmer, immediate past president of the board of directors, said in that article that the board decided to invest a significant portion in endowment funds that would allow earnings to be used to meet their mission of not just providing food for those who would otherwise go without, but also helping with critical needs such as paying utility bills. He said the endowment also serves as a safety net if private or government donations decline for some reason.
The article stated that about $141,000 has been invested in an endowment with the Carroll County Community Foundation. However, CCCF Executive Director Janell Robertson wrote in an email that the funds for FSF are in a “quasi-endowed fund.” FSF representatives had told the Independent in interviews for the earlier story that it was an endowment and that the principal could not be accessed.
Robertson wrote that money in the FSF quasi-endowed fund is invested and growing and just a small portion of it is endowed for three years. She said after three years, all the initial donation and the invested growth can be accessed by the quasi-fund holder.
“The money that is invested but not endowed in the fund can be accessed immediately,” Robertson wrote. “The money that is invested and briefly endowed can be granted out at four percent if needed. It is a great tool for fundholders who want to make large grants, or nonprofit organizations to grow their funds for a planned expansion or necessary expense.”
According to insidephilanthropy.com, a conventional endowment is set up to exist in perpetuity. “This is where ‘you never touch the principal’ (the money that was donated to the endowment), and only the investment income (or a portion of the income) is spent,” the website states.
Robertson said the CCCF has many types of funds and endowments that support charitable giving and grantmaking.
“We have a ‘charitable fund’– not unlike a charitable checkbook,” she said. “Money is donated to create a charitable fund and that money can be fully granted out at any time. Tax-deductible donations in and grants out on behalf of the individual or family that created the fund. The Community Foundation handles all the paperwork and at the end of the year the fund holder receives a tax letter stating where all the grant funds were awarded. This charitable fund is not invested or endowed.”
The third type of fund they have is the endowment. This type of a fund is invested and fully endowed.
“Many individuals, businesses, families and nonprofit organizations hold these types of endowments because they want to create a legacy of support for the causes they care about,” Robertson said. “An endowment spins out a four percent grant every year and will never stop giving back.”
Robertson said CCCF works with donors and nonprofits to personalize their funds and endowments. Each of the 47 funds/endowments CCCF holds were individually created based on the vision of the donor and the needs of the community, state, and nation they love and cherish, she said.
Since being established in 2001, CCCF has given more than $1.3 million in grants in the area.
In the original article, Helmer and Treasurer Kent Turner said the extra funds held by FSF help provide stability in times when there may be unexpected expenses, or when government and/or private donations decline.
“We thought it was best to have a nest egg,” Turner said. “There are a lot of things that could happen to the building such as having to spend money on repairs. We don’t think this is a lot of money to keep in reserve.”
The article in early February quoted Helmer as saying they are also in conversation with several groups to address the lack of low-income housing. And they are also looking at some emerging partnerships with other organizations with the view of perhaps purchasing a building to expand their services and even become a distribution point for food from the Northwest Arkansas Food Bank.