Frequently Asked Questions
What is an Endowment?
An Endowment is a fund whereby money donated to the fund is not "spent" but is invested and (in a simple sense) only the return-on-investment (ROI), or annual interest earned, is spent. Its purpose is to provide a permanent/perpetual source of funds. Many institutions, including practically all colleges and universities, have Endowments. There are variations on this basic idea.

What kind of Endowment is ours?
After investigating several possibilities, including a program through the general fraternity ("nationals"), the alumni board decided that a program offered by Georgetown College would best suit our needs, and indirectly support the College at the same time. Simply put, our Endowment is a small part of Georgetown College's endowment... and thus its fate is the one and the same as the College's fund.

How does the College benefit from our Endowment?
The College receives NO direct financial benefit from our fund. ALL interest/ROI generated by our fund either goes back into our endowment account or is issued for the use of the chapter. The College does not even charge a "management fee," which most other plans do.

There are two main benefits to the College. First the College views assisting our chapter (and other groups on campus, such as KA) as a "good thing" for the College overall, including alumni relations. Secondly, whenever the College reports the amount of money in its Endowment (important for accreditations and fund-raising), they may include the amounts of any of the "sub-endowments" like ours.

How much is issued to the chapter each year?
The exact answer to this question of course depends on many factors, including the amount in our account, the interest/ROI earned, etc. But in the end, the amount issued is a percentage of the fund set by the Board of Trustees of Georgetown College called a Drawdown. This drawdown is not chosen specifically for our account. It is equal to the amount the College chooses to drawdown from its own Endowment each year for its use, and may not be equal to the interest/ROI earned.

For example, in a "good" year, the interest earned may be 8%. But the College may decide it only needs to drawdown 5% for this year's College budget. The remaining ROI is simply "left" in the Endowment to generate more funds for the future. In a "bad" year, the Endowment may earn only 2%, or may even loose money (a possibility with any investment), and the College may decide to drawdown more than was earned. Whatever the drawdown percentage is, that percentage on the amount in our Endowment account is issued for the chapter's benefit.

Will the chapter receive funds immediately?
That depends on the amount donated to the fund. According to the agreement, the chapter will receive no funds until the account reaches $25,000. Any interest/ROI earned until then is kept in the account and continues to earn interest (so its not "lost"). So we need YOUR HELP to reach our goal of $25,000 before the chapter will see one red cent! However, in a "typical" year, we can hope to see at least a 5% drawdown, so as soon as we reach our goal, the chapter should receive at least $1,000 per year on average. As the fund continues to grow, so will the amount received by the chapter.

What will the funds generated be used for?
As a tax-deductible/charitable/educational Endowment, the funds received by the chapter may only be used for educational purposes. This includes improvements/funishings for the dorm/house, scholarships for undergraduate members, expenses related to attending educational conferences (LCA General Assembly now always includes educational leadership seminars), or any other educational or training activity of the chapter.

So NO, it won't be used to purchase "liquid refreshments" for parties! Currently, the alumni board would like to offer scholarships to associate members to cover their liability insurance premiums which are billed through the "national" fraternity office.

Why should I donate to the Endowment instead of to the chapter or alumni associaton?
First of all, feel free to donate directly to the chapter or alumni association if you choose to do so. The primary reasons for donating to the the Endowment instead are: Who do I contact with questions?
Many brothers, and others at the College, have put a great deal of effort into setting up the Endowment. However the following would be the most knowledgeable to answer questions:
How do I make a donation?
Click here for information on how to make a donation.

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