A community foundation is a tax exempt, non-profit, publicly supported philanthropic organization with the long term goal of building permanent, named funds, for the broad-based public benefit of the residents in a given area.
The common mission of every community foundation is to enhance the quality of life in the local area. Community foundations carry out this very broad mission by building permanent endowment funds and using a portion of the annual income to support a variety of local nonprofit organizations through grants and special projects.
Most community foundation assets are held in separate funds established by local individuals, families, businesses, or charitable institutions. Each fund may have a special purpose, but the foundation board of directors, representing the community, oversees them all.
The Catholic Community Foundation of San Diego (CCFSD) is a 501(c)(3) non-profit, independent corporation established in 2015 to assist individuals and organizations in providing lasting financial support to the Catholic religious, educational and charitable organizations of San Diego and Imperial counties in California for generations to come.
The primary focus areas for the CCFSD are the 98 parishes, 48 Catholic schools, USD and John Paul the Great Catholic University, new vocations, retired and disabled religious and more than 100 Catholic ministries in San Diego and Imperial Valley.
When donors give to CCFSD, they have the option of establishing a fund from which they can recommend how, when, and where their donated funds are distributed to charitable causes. Donors enjoy the satisfaction of knowing that their gift will directly support the Catholic organizations/priorities they choose.
The CCFSD offers Catholics in our region a way to leave their legacy uniquely aligned with their Catholic values and beliefs. It offers opportunities for donors to make gifts that align with their charitable interests.
Today, we are challenged to care for the Church that has been passed on to us, and to preserve it for future generations. Providing for future generations is a significant aspect of Catholic stewardship.
The Foundation was established to provide a means for individuals and organizations to provide long-term financial stability for San Diego and Imperial County’s parishes, missions, schools, agencies, and organizations.
The CCFSD has an independent governing body composed of clergy and lay people representing the broad interests of the community with members of the Board of Trustees serving limited terms. The Board’s objective is to pursue an investment policy consistent with reasonable growth while prudently safeguarding the principal. The directors are leaders in their parishes and communities and are accountable to both donors and recipients. The Board of Trustees has the responsibility for hiring an Executive Director who provides direction, planning and manages the day-to-day operations of the foundation.
The CCFSD is completely independent of the Diocese of San Diego. The CCFSD is separately incorporated, has its own 501(c)(3), its own Board of Trustees and its own bylaws. The Bishop of the Diocese of San Diego is fully supportive of the mission of the CCFSD.
Independence from the Diocese of San Diego offers several advantages to the Foundation’s Donors and the Foundation: All funds under the stewardship of the Foundation,
- Are protected from all past, present or future ligation against the Catholic Church, any parish or the Diocese of San Diego.
- are independently invested to achieve strong growth for the Foundation and its Donors.
- are invested following the US Conference of Catholic Bishops’ guidelines for Socially-Responsible Investing (SRI) and Catholic Values Investing (CVI).
- All decision-making at the Foundation will always be made to support the intentions of its Donors without influence from any outside organization.
CCFSD functions as a professional philanthropy management office for its donors, providing excellent customer service and customized giving solutions within a regulated and transparent business environment.
The foundation relieves donors of investment and regulatory reporting burdens while providing clients with comprehensive, up-to-date reporting on both the grants and donations made in their names.
Donations also realize immediate tax benefits for CCFSD’s clients. See “Tax Advantages” section below for further details.
No. CCFSD is committed to the concept of stewardship and sharing the resources that God has given each of us with those in need. As such, we and our donors support nonprofit organizations and programs in both the Catholic community and the community at large. These include Catholic, as well as non-denominational organizations such as colleges and universities, health organizations, environmental causes, and social service groups, among others.
Yes. Generous donors can give to any 501(c)(3) charitable organization that serves the needs of the community and does not conduct business contrary to Catholic teachings. Your funds can go toward your school or university, a civic cause, a cultural institution, or any qualifying charitable organization operating in accordance with Catholic values anywhere in the country.
CCFSD is distinguished by faith-based and socially responsible operations purposely aligned with the Catholic Church. The foundation’s Catholic mission is the most important factor in a donor’s decision to manage his or her philanthropy through CCFSD.
An endowment fund in your name, family name or that of a loved one is a lasting way to support your favorite charitable causes throughout your life and leave a legacy long after you are gone. It is a powerful way to pass on the lessons of philanthropy to your children… and theirs.
We work hard to make giving easy and meaningful for donors and the causes they care about by:
- Accepting a wide variety of gift types (cash, stock, life insurance);
- Offering many fund types. You can name a fund, advise a fund, or designate an area of interest or specific charity to benefit;
- Handling fund administration – you get the joy of giving while we do the research, paperwork, grant follow-up and reporting;
- Sharing our community needs expertise; and
- Endowing funds so that your charitable wishes create a permanent legacy.
No. The foundation is able to accept gifts of appreciated securities (which provide significant tax advantages to the donor), (appreciated) real property, life insurance or, in some cases, personal property. Our community foundation offers the maximum charitable deduction available for estate and gift planning opportunities. The foundation is able to provide information on giving techniques and assist donors to evaluate the most effective ways to accomplish their charitable goals. Gifts may be given in the form of immediate gifts such as cash, real estate, stocks and bonds – or in the form of future gifts through wills and bequests or as a designated beneficiary of a life insurance plan, retirement plan or IRA. The Foundation also accepts up to $100,000 in IRA Required Minimum Distributions (RMDs) from individuals wishing to avoid the tax impact of receiving these funds on an annual basis. For more information on unique giving opportunities, please contact Gary Rectenwald, Executive Director, at 858-397-9701.
By all means. We highly encourage you to continue supporting the charities you care about. Giving through CCFSD can benefit the causes you care about because of our commitment to endowment (meaning your gift makes a permanent impact); our ability to accept complex gifts; and our professional expertise in managing and investing your gift. In some instances, a charity may be doing outstanding work in their mission area, but does not have the financial expertise to manage and invest your gift for the best impact. An endowment stays permanently invested. An outright gift of cash is depleted over time. An endowed gift is administered based upon an irrevocable legal agreement. You can be assured that your donation will only be used as you have specified. There is no guarantee that an outright gift of cash will be used as you intended.
Types of Funds
There are several possibilities, depending on a donor’s wishes. The major possibilities are four:
- If a donor makes an unrestricted gift, the contribution will be added to and permanently recognized in The General Fund. (Alternatively, some donors may wish to establish and name a separate unrestricted fund.) The income from the total fund (built up by many donors over many years, one gift at a time) will be distributed annually for charitable purposes as determined by the board of directors.
- Other donors may want to support a general area or field of need in our community (Faith Formation and Parish Life, Peace and Justice, Retired Priests and Religious, Sanctity of Life, Service to the Poor, Vocations, and Youth and Education). Such field of interest gifts support the donor-intended areas in our grants program. These contributions will never be used for projects outside their specified area. Contributions of any size are always welcome to support these funds. Again, all specific grant-making decisions from field-of-interest funds are made by our board of directors.
- A few donors ask us to restrict the use of their gift to one or more specific nonprofit organizations (i.e. a specific parish, school, or agency). These gifts create what are called designated funds. A community foundation will often be asked to handle such gifts because of its experience with managing endowments and providing oversight in the annual distribution.
- Many donors choose to establish donor-advised funds. In this case, the donor may periodically recommend to the foundation that a distribution be made to a specific nonprofit organization. (CCFSD is not legally bound to follow these recommendations. However, we will do so in most cases when the intended grantee is a legitimate nonprofit organization and operating in good standing with the IRS.) Donor advised funds are especially suited to donors with a variety of charitable interests and an interest in being involved with philanthropy.
The community foundation can also be used for a variety of other purposes, including short-term gifts, pass-through grants, and gifts which allow a donor to remain anonymous.
An endowment is a long-term fund invested for perpetuity and only the growth and earnings are available for distribution. This provides a stream of income to the beneficiary(s) in perpetuity to be used following the terms of the fund agreement.
No. Some donors prefer to see a greater percentage of their gift distributed annually through non-endowed funds.
The minimum amount to open an account is $5,000.
Yes. In fact, most Catholic entities and individuals develop a plan for building their endowment. You may add to your endowment fund in any amount at any time.
Yes, the beneficiary recipient can choose to receive the distribution at the time it is offered, carry the distribution over to a future payout date or reinvest the distribution permanently in the fund.
In general terms, by creating an endowment, an individual can take another step in living out the life of stewardship – giving of time, talent and treasure in gratitude for God’s many gifts to us. Just as we have the opportunity to make our gifts of treasure from our monthly income, we also have an opportunity to give from our accumulated assets to endow the future of our Catholic community in San Diego and Imperial County.
By creating an endowment, a Catholic entity such as a parish or school can tell the community that the parish or school is providing for the future and intends to continue serving the community for many years to come.
In specific terms, an endowment fund provides a permanent and secure source of income, which can ensure the future of our Catholic parishes, schools, agencies and organizations.
Donor-Advised Funds are established by Donors who have a range of charitable interests and wish to participate in the future grant-making process of the fund. Upon receipt of the gift, the Donor receives a receipt acknowledgement from the Foundation and qualifies for a tax deduction from the IRS. Donor Advised Funds generally remain in existence for many years and are often added to on an annual basis by its Donor.
The CCFSD’s investment strategy is guided by the Foundation’s Investment Policy Statement (IPS). Please contact us to request a copy. The strategy is focused on total return to preserve and enhance the purchasing power of each endowment and to maintain a consistent distribution policy so that endowment beneficiaries can prudently utilize their distributions. All funds are invested consistent with the U.S. Conference of Catholic Bishops’ guidelines for Socially-Responsible Investing (SRI) and Catholic Values Investing (CVI).
Generally, the foundation will hire a professional advisor to assist in investing its funds. The Board of Trustees of the foundation has an Investment Committee to establish the philosophy and policies for investments and to oversee the process. The Investment Committee regularly reviews the financial markets and economic environment to decide upon the best asset mix. It also uses investment management firms whose proven expertise, within specific asset styles, offers an opportunity for outstanding performance in rising markets, while limiting losses in difficult ones.
The Foundation is an integral part of the local Catholic community and the San Diego/Imperial community at large and as such, offers you comprehensive guidance through its network of collaborative relationships. Big brokerage houses (i.e. Vanguard, Schwab, etc.) don’t understand the needs of the local Catholic community. The Foundation, with its commitment to personal service, can offer strategic guidance and consulting on best philanthropic practices through its staff’s expertise.
This is negotiable, depending on your fund’s asset size.
The current Spending Policy available to the endowment funds can be requested by contacting our office. The initial income distribution will be available after the endowment fund’s first anniversary and will be based on the endowment’s previous 12 quarters rolling average asset value. Because of this averaging, the effect of temporary fluctuations in the market will be smoothed out, thus making it easier for endowments to anticipate their available amount for distribution.
We offer the best tax advantages for charitable donations available under law. We are a publicly-supported non-profit organization, qualified under section 501(c)(3) of the internal revenue code.
Because CCFSD manages a large number of unrestricted and discretionary funds, administrative costs and service fees for any one fund are minimized—meaning less overhead cost to the donor’s fund.
Contact your tax advisor or accountant regarding your particular tax benefit circumstances.
Yes, the Perpetual Light Society is a special designation honoring our donors that remember their Catholic faith in their will or estate plan. The Society provides an opportunity for benefactors to make their philanthropy a perpetual legacy for themselves and an example for their families. Living Society members will pray for these special benefactors during their lifetimes and after their passing. Members will also be invited to attend an annual mass and luncheon with the Bishop and/or Auxiliary Bishop of the Diocese of San Diego. Most importantly, members will be donating to the security and success of future generations in our Catholic community.
The main difference between the two designations is that our Founders Circle is cash in hand for the Foundation, while Perpetual Founders is a promise of funds to come.
One program represents funds available now and one is funds available for the future. Both are extremely important to the present and future of our organization. If you are considering becoming a member at either level we welcome you to contact our office so we can help you understand more about these special groups.
The Community Foundation provides all IRS reporting, accounting and accountability. The Community Foundation ensures that all grant recipients meet the tests to ensure tax-deductible status. When appropriate, the Community Foundation can help donors solicit proposals to fund certain categories of interest to the donor. Donors are kept apprised of special community needs on a regular basis. We can also help donors publicize their funds or, conversely, act as a community liaison to provide anonymity for donors.
Absolutely. The Foundation strictly guards the privacy of all donors and their sensitive personal and financial information. All communications, documents and discussions are held in the highest confidence. A fund at the CCFSD can be completely anonymous. You can determine which – or whether – your grants are public and which ones remain anonymous. The CCFSD files its 990 as a compilation of funds under its administration, and no third party can access information about your fund’s assets, advisors, grants etc.
Absolutely. CCFSD will document and follow the intent you specify for your fund, including your wishes for the involvement of future generations.
Periodic reminders are sent to fund advisers to let them know about their grant-making capability and capacity, especially if a fund has not been active for over one year.
If a fund remains inactive for three years, the funds are transferred to a community fund managed by CCFSD’s Board of Directors and aligned with the initial intention of the client. This assures charitable granting will continue and the fund will not be dormant.
It is a simple and straight-forward process involving a meeting with a representative of the Foundation and the donor to review the fund agreement form and determine the donor’s desires and the most suitable way to accomplish them. Once the donor and other appropriate counselors of the donor approve the form, the initial contribution is made and the fund is established.
It has been the practice, and the goal of the Foundation, to keep the operating costs of the Foundation under 1% of the Foundation’s assets under management. We believe this % if far below any other community foundation in Southern California.
Each fund is assessed an annual administration fee to help cover the administrative costs of the foundation. A primary goal of the Catholic Community Foundation of San Diego is to minimize administrative costs so that maximum earnings can be granted to nonprofit organizations to further the mission of the Church.
Yes, CCFSD assesses a support fee to cover management and administrative expenses. CCFSD’s fees do not exceed 1.0% of the fund’s average balance and 1.5% for donor advised funds. Fees for funds in excess of $1 million are less.
Complete and total transparency and accountability are hallmarks of our foundation. The bylaws of the CCFSD have been drafted to require the foundation to undergo an annual independent audit which will be published on the foundation website. The information provided will include a detailed breakdown of donations, grants, fund balances and other important information substantially consistent with the information included in a Form 990, the tax return filed by nonprofit public charitable organizations.
Yes, CCFSD uses DonorCentral. DonorCentral is a secure, online platform that allows fund holders to view details relating to their fund. For each Donor to a Foundation fund, each Donor is provided a userid and password to gain electronic access to DonorCentral. On the system, each Donor will have immediate access to the current balance of the fund along with the history of deposits, fund statements, grants and interest, earnings and dividends paid to the fund. Access to the system is available 24/7/365.
It is always the Foundation’s policy to honor the original donor’s intent. In most cases, a donor’s instructions will never be amended. A common governing instrument, called a fund agreement, covers all gifts and funds in the foundation to ensure that the donor’s intent is followed. However, the agreement does include a “variance power” to modify the use of restricted funds if such restrictions become unnecessary, incapable of fulfillment or inconsistent with the charitable needs of the community or area served. Those are the only conditions under which a foundation modifies the terms of a gift.
A community foundation is supported by a broad and ever-widening group of unrelated individuals, families, corporations, and institutions. The only thing that connects all of our donors is a desire to improve local communities.
Private foundations, by contrast, are generally supported by a single individual, family, or business. Rarely does it make sense to establish a private foundation if the principal endowment is not large. To prevent abuse and self-dealing, private foundations have been subjected since the 1970s by the IRS to numerous penalty taxes and legal requirements.
Often, people establish a family foundation or a private foundation because they don’t know that in many cases, working through the Community Foundation offers an easier alternative.
No. The CCFSD is a community foundation so is not legally bound by the 5% annual pay-out regulation that governs private foundations so donors may leave their funds dormant when they lack the time to focus on it in any given year.
Because of their broad base of support, community foundations are classified by the IRS as publicly-supported charities. This gives community foundations tax advantages not enjoyed by private foundations.
Community foundations combine the tax advantages of a public charity with the lasting quality of a private foundation. Gifts of cash and ordinary income property to a Community Foundation are deductible up to 50% of adjusted gross income versus 30% for a private foundation. Gifts of appreciated property can be credited for 30% versus 20% for a private foundation. There is no excise tax on community foundations as there is on private foundations, and community foundations do not have the payout requirements of private foundations.
Having a fund at The Foundation will spare you the paperwork, research, administration and staff costs involved in managing an independently-run private foundation. We take care of all bookkeeping, compliance issues and other record-keeping, so you and your foundation board can keep focused on the joy of philanthropy and fulfilling your charitable passions, and leave the administration and management to us.
Additionally, with broad expertise in charitable giving practices, The Foundation is able to strategically guide you in meeting your philanthropic, as well as tax and estate planning objectives.
Setting up a fund through the Community Foundation has an extremely short turn-around time. Additionally, the staff of the foundation becomes available to help with grants, screen grant requests, and take care of auditing and financial reporting requirements.
Yes. Families, individuals, businesses and organizations can utilize the same name they have been using (ex: The John and Mary Smith Family Foundation or the Greystone Company Fund)
Yes. Your committee or advisors can remain intact.
Community foundations are also allowed to treat all funds within their control (known as “component funds”) as part of a single corporation. This gives them investment advantages over private foundations.
You can also use assets like real estate and closely-held stock which are problematic to use in funding a private foundation