Raising Funds For 4-H Endowment
The Alabama 4-H Foundation may provide an Endowment account as a “service” to county 4-H councils, area 4-H councils, or other affiliated 4-H groups from which 4-H directly benefits. This allows the 4-H affiliated organization to place funds in an already established 501©3 organization that is audited and files a Form 990 annually. Each account accrues income through interest dividend/capital gains distributions. Such an account is not to be used as a checking account, as funds may only be requested at a specific time per fiscal year.
A written agreement shall be drawn up between the Alabama 4-H Club Foundation and the affiliated 4-H organization. The agreement shall include the title, objective, purpose for which funds may be used, initial amount, criteria, and administration. The affiliated 4-H organization shall specify the length of time for which the funds is to be invested before a payout of income/gain or principal is to be made available. The organization shall also specify any other investment limitations placed on the funds.
A minimum requirement of $5,000 is required to establish an Endowment account.
On an annual basis (October 1 – September 30), 90% of the growth of the funds will be made available to the 4-H affiliate for their use in the designated 4-H areas funds originally were secured for. The 4-H affiliate will receive an accounting of funds available for the year (based on the 90% growth) and will be given an opportunity to make a request for funds. A minimum amount requested at one time shall be $250 up to the balance of the annual growth minus 10%. Upon receipt of the request, the Alabama 4-H Club Foundation will allocate funds to the 4-H affiliate for their use in the designated programs areas.
The 4-H affiliate will be made aware that the possibility of a loss rather than a gain exists in a fluctuating financial market.
Once the funds are placed into an endowment with the 4-H Foundation, they cannot be removed.
The funds will be managed by the 4-H Foundation and will receive the benefits of being included in a larger pool of funds, managed by a professional investment firm. In addition, they will receive the benefit of being included annually in the 4-H Foundation tax accounting and will be reported by a professional tax accounting firm.
The county will not have to pay for these funds management services.
Local 4-H Endowment opportunities and their minimum fund requirements:
- 4-H local program endowment - $10,000
- 4-H local camp scholarship fund - $10,000
- 4-H local recognition fund - $10,000
- 4-H local county agent position – $1 million
State 4-H Endowment opportunities and their minimum fund requirements:
- State 4-H Youth Development Chair of Excellence – $1 million
- State 4-H Project Endowment - $25,000
- State 4-H Program Area Endowment - $100,000
- State 4-H Camp Scholarship Endowment - $25,000