SOMERS EDUCATION FOUNDATION
Supporting Education for our Future
After the formation of the non-profit, it was time to figure out how SEF was to build its cash reserve. SEF wanted to be sure that there were always funds for awarding of deserving projects and supplies even if they had a year of high expenses or lower donation levels. An endowment assures financial bedrock for the organization.
Funds were raised to start this financial base through donations and fundraising events. The founders decided that the awarded funds were to be only a certain percentage of the interest earned on these funds. That way, the endowment would always be there and always earning interest. Very, very wise, indeed.
One of the original cornerstones of the Somers Education Foundation was to build an endowment of sufficient size to allow it to grant awards every year regardless of the state of the general economy. The plan was to grant 50% of its income yearly and use the other 50% to pay expenses and build an investment portfolio. The first ten-year goal was to have $250,000 in the endowment. The SEF has been successful in meeting its goals – both of providing funds to the schools and building its endowment. The endowment growth goal was actually exceeded! The SEF had $310,000 in its endowment on its tenth birthday on 6/30/2014.
The SEF was started in 2004 with generous gifts from its original Board Members, allowing it to have an immediate impact in its first year of existence. The endowment has grown in subsequent years through community fundraising events and investment. It is a source of pride that the endowment grew in 2008-2009 during the greatest economic downturn in 75 years.
The first ten years were used to build the endowment. Going forward, the endowment will actively be used to support grant and awards employing “The Prudent Man Rule” of never taking more than 4% per year from it. The endowment funds will be used exclusively for grants and awards and not Foundation expenses.