| 501(c)(3) & 509(a) |
Sections of the internal Revenue code designating the GCRCF a charitable, tax exempt organization. The 509(a) section designates the foundation as "public" versus "private" foundation. |
| Agency/Organization Endowment Fund |
Indicates an endowed fund established by another charity with the GCRCF for management and investment. Annual income is distributed only to the charity for so long as it exists. |
| Annual Report To The Community |
Each year the GCRCF publishes an annual report that is distributed as widely as possible to the general public. The report describes the GCRCF's mission, leadership, programs, services, grants, contributors, donor funds, and donor services. |
| Assets |
All property and resources owned by the foundation - i.e. cash, securities investments, real estate, certain irrevocable remainder, trust remainder interests, etc. - that are held for the future benefit of the foundation and its work. |
| Audit |
The independent examination of the GCRCF's financial records by a CPA, and the impartial expression of the reliability of financial condition. |
| Balance Sheet |
A financial statement showing the GCRCF's assets, liabilities and fund balance. |
| Bequest |
A charitable gift made by will to the foundation, transferred at the Donor's death. |
| Bricks & Mortar |
A reference to grants made for building and construction purposes. |
| Bylaws |
Developed in accordance to state law, the bylaws provide overall guidelines for the operation of the foundation, selection of directors, committees, etc. |
| Challenge (or Matching) Grant |
A grant made contingent on the receipt of other moneys being secured, usually within a specified time, the objective of which is to stimulate giving from other sources. |
| Charitable Contribution |
Assets given to the foundation by a donor (an individual, trust, estate, Group or organization, etc.) to carry out the foundation's charitable purpose. |
| Charitable Deduction |
The portion of a donor's gift to the GCRCF that may be deducted from income or estate taxes. |
| Charitable Gift Annuity |
A gift of cash or securities in exchange for the promise of a lifetime income. It is a contract between the donor and GCRCF that is part a charitable gift, part purchase of an annuity, and is backed by the assets of the foundation. |
| Charitable Lead Trust |
A charitable lead trust pays income to the GCRCF for a specified period (not less than 1 year & 1 day), with the principal reverting to the donor or another person(s) at the end of the period. |
| Charitable Remainder Trust |
A gift of cash, securities or other property to a trust that pays lifetime income to one or more beneficiaries, with the remainder of the assets passing to the foundation at the death of the last beneficiary. May be established as an annuity trust (CRAT) with a fixed annual payout, or a Unitrust (CRUT) with a variable annual payout. |
| Community Foundation |
A foundation that builds assets through a broad base of community. Contributions from multiple sources, usually within a defined geographic area. CF's support charitable activities focused primarily on local needs, and are designated "public" versus "private" foundation as they receive the major portion of their resources from the general public rather than a single individual or family. |
| Component Fund |
A component fund is any individual fund established within the foundation, over which the board of directors has complete control, and the assets of which are the property of the foundation. |
| Corporate Fund |
This is a type of fund established in the GCRCF by a corporation or other business, through which the business conducts its annual charitable giving. A corporate fund may be established either as an endowed or non-endowed fund. |
| Designated Fund |
The donor names one or more specified organizations as the designated beneficiary(ies) to receive the annual distributions of income. |
| Donor-Advised Fund |
The donor or designated parties actively participate in the grantmaking process by making recommendations to the community foundation of recipient organizations from the fund. The GCRCF board has final authority to approve or disapprove the donor recommendations. |
| Distribution (Grant) Committee |
The distribution or grant committee is a standing committee of the foundation whose responsibility is to perform due diligence of all grant requests, determine their suitability for funding, and make final recommendation to the Board of Directors for action. |
| Donee/Grantee |
Individual or organization receiving a grant from the foundation. |
| Endowed Fund |
Assets given to the foundation for the purpose of establishing or adding to a permanent fund. Endowed assets are usually intended to be "in perpetuity," although a fund with a specified lifetime of an extended period of years may also be considered endowed. Generally, only a portion of the
income is distributed each year. |
| Excise Tax |
A tax on the net investment income of private foundations, but not applicable to community foundations. |
| Fiduciary |
Person(s) charged with the legal responsibility for the actions of the foundation, and on behalf of its donors. The Board of Directors of the GCRCF (as well as its CEO) assumes fiduciary responsibility for the foundation, its assets and activities…a position of trust. |
| Field-of-Interest Fund |
A fund for which the donor specifies one or more general fields of interest to benefit from the fund distributions (i.e. to "assist the homeless and hungry," to promote artistic expression," etc.). The GCRCF has full discretion to make specific grants within the general area(s) specified by the donor. |
| Financial Accounting Standards Board (FASB) |
This board issues statements of financial accounting standards that represent generally accepted accounting principles, and define how our audit records must be presented. |
| Form 990 |
The IRS form filed annually by the foundation, also referred to as the "information return," that must be made available to any person requesting a copy. |
| Grant |
An award made by the foundation to an organization or individual to undertake charitable activities. The GCRCF does not make grants to individuals, except scholarships that are made to the educational institution in the recipient's name. |
| Letter of Intent |
A letter or statement by the donor indicating his/her intent to make a contribution and/or an indication of the intent of purpose, conditions, etc. |
| Non-Endowed Fund |
These are temporary funds established with the foundation with the expectation that principal will be expended for charitable purposes within a relatively brief period. Examples include corporate funds, individual non-endowed donor advised funds, special funds (capital campaign funds), etc., often referred to as "pass-through" funds, often the GCRCF serves primarily in an agency capacity for administrative purposes. |
| Payout Requirement |
The amount that the IRS requires to be expended annually by a private foundation. Community foundations are not subject to a payout requirement. |
| Policies (Policy Statements) |
Formal policy directives adopted by the Board of Directors that provide the basis for the foundation's activities and management. Such policies include investment, grant making, financial reporting, conflict of interest, etc. |
| Public Support Test |
A test required by the IRS of all publicly-supported charities, including community foundations, to insure that they are "responsive to the general public" rather than a limited number of people. Each year the public charity must demonstrate that at least one-third of its annual support derives from gifts, grants and contributions from the general public. There are additional "tests" that apply if an extraordinary event means that the charity fails its 1/3 test, but can otherwise meet the general tests of Boraod-based board representation, etc. An "extraordinary event" may be the one-time receipt of a large gift or bequest, etc. |
| Retained Life Estate |
A donor may give a remainder interest in a home, farm, etc. to the foundation, but maintains the right to live in the home, etc. for his/her lifetime. |
| Return, Total |
A measurement of the foundation’s investment returns that includes both realized and unrealized gains (losses) plus earned income. |
| Seed Grant |
A grant made to enable the start-up of a new organization, project or program. |
| Site Visit |
A visit by foundation program staff and/or board to a (prospective) grantee organization. Site visits are common on-site evaluation and due diligence techniques. |
| Spending Policy |
A policy that determines what percentage of the foundation's endowment should be spent to cover grants and operating expenditures. The GCRCF determines its "spending rate" at the beginning of each year, based upon the prior year's investment returns and other considerations, and sets it as a percentage of the average prior three years closing market values. |
| Supporting Organization |
Another charitable organization, usually a private foundation that attaches itself to the community foundation to achieve public charity status, thus eliminating IRS payout requirements, excise taxes, etc. The board of the supporting organization must have a majority of its members selected by the community foundation, and must meet certain other specifications. |
| Technical Assistance |
Operational and/or management assistance given to a charitable organization by the GCRCF, usually for fundraising advise, administrative consultation, etc. by foundation staff or others provided by a foundation grant, etc. Often the foundation will arrange for pro bono professional legal or accounting services, etc. |
| Trustee |
The person or institution having legal responsibility for the administration of a trust. The GCRCF will serve as trustee for certain charitable remainder trusts, etc., but ordinarily only when it has a significant irrevocable remainder interest in the trust. |
| Unrestricted Fund |
A fund in which the donor permits the foundation and its board to exercise full discretion regarding charitable distributions. |
| Variance Power |
Outside of a court of law, only community foundations are granted the power to exercise the doctrine of cypres. Simply stated, should the purposes of any fund within the foundation become "impossible, impractical, or illegal" to perform, the board of the foundation is responsible to redirect the purposes of the fund, but keeping in mind the original intent of the donor to the extent possible. Of the many distinguishing features of a community foundation, this is the most unique and significant. |
