Virginia Tech Foundation

Endowment Funds

Endowments are funds or monies that are permanently restricted by a donor. The intent is that the principal of the original gift can be used to provide a perpetual stream of financial support to a program, scholarship or professorship.

To establish an endowment fund, a signed agreement between the Foundation and the donor(s) is executed. The Foundation agrees to accept the responsibility for the investment and reinvestment of the principal of the fund. The Authorized Signers are responsible for seeing that the payout from the fund is used in accordance with the wishes of the donor(s). The Foundation will review expenditures presented for payment to ensure compliance. The principal of an endowment is held constant with a portion of the total return being used each year.

Endowments are assigned two separate banner funds, an income/expense fund and an endowment corpus fund. The income/expense fund will receive the payout distribution, that is, the monies that are expendable. The endowment corpus fund will contain the donor(s) principal gift less any gift fees to the fund, in addition to both realized and unrealized appreciation associated with the fund.

A named individual endowment may be established in the Foundation. Virginia Tech policy establishes minimum levels for named endowments so that income is adequate to meet the endowment purpose. Opportunities exist to name scholarships, professorships, fellowships, and lectureships, as well as dean and faculty chairs. The description of the endowment opportunities and the minimum level needed to establish a named endowment at the Foundation can be found at http://www.vtf.vt.edu.