Frequently Asked Questions | The Church Foundation

What is the investment philosophy and objectives of The Church Foundation?

The Church Foundation (TCF) is a nonprofit corporation, chartered in 1926, as a service organization for the Diocese of Pennsylvania. TCF serves trustee and investment advisor for assets owned by churches, chapels, missions, and institutions in the diocese. Our primary purpose is to oversee the Consolidated Fund, a balanced portfolio of stocks and bonds, for the diocese and other church-related institutions.

The investment philosophy and objectives of The Church Foundation is to provide the best rate of return for our investors through prudent investments and a distribution payout vehicle to fund mission and ministry. The Church Foundation's Investment Committee and Board of Directors work closely with our Investment Manager, T. Rowe Price, to ensure the preservation and growth of the investments so that our participants have those assets available when needed.

Investors with The Church Foundation are purchasing units or shares in the Consolidated Fund. The Consolidated Fund is a carefully structured array of equities and fixed income instruments designed to meet the investment policy statement guidelines established by The Church Foundation Board of Directors.

What is the Fee Schedule?

The Church Foundation's management fees are reviewed and set annually by the board of directors. For 2020, TCF charges a fee of .29% to cover administrative and operational costs.

Our investment manager, T. Rowe Price, charges about .55%, which are applied net of fees. Total fees are currently at .84%, which is well below TCF's total fees goal of less than or equal to 1%.

How is the distribution amount calculated?

The Church Foundation strives to obtain for investors a cash distribution that supports current operating needs for mission and ministry and honor its fiduciary duty to preserve the future earning power of the investments in all sorts of market conditions.

A distribution spending rate is reviewed and set annually by the board of directors based upon the investment committee's recommendation. Once the spending rate is set, cash distributions are calculated by applying the approved spending rate to the trailing twelve-quarter average of the Consolidated Fund's fair market value as of the end of the previous calendar year. We further determine a cash distribution amount per unit (share) price by dividing the total units in the Consolidated Fund held at the end of the previous calendar year by the total estimated cash distribution amount calculated for the current year.

What is the background and experience of the team, including investment managers?

Lori has been with The Church Foundation since December 2014. She began working with TCF as the Operations Manager and was named the Executive Director by the board of directors on July 1. Lori is am an administrative professional with nearly 30 years of experience and holds a BS in finance. She is currently working on her master's in nonprofit management.

Ryan is a management professional with nearly ten years of experience. He has been with The Church Foundation since late August 2019. Ryan attended Ursinus College and West Chester University, majoring in management and accounting.

T. Rowe Price has been The Church Foundation's investment managers since 2007. The Church Foundation's investment committee takes its role seriously as a fiduciary and keeps a close eye on activity and performance. Overall, the committee is pleased with T. Rowe Price and has no plans to make any adjustments or changes.

SunTrust Bank's Foundation and Endowments Specialty Practice have been The Church Foundation's fund accountant and custodian since 2017.

Are you an actively-managed or passively-managed fund?

Our portfolio is actively managed.

The Church Foundation has generally invested 70% equity and 30% fixed income/debt, and maintains approximately $100,000 in cash to cover non-distribution withdrawals.

Are you invested in anything other than debt and equity securities or funds?

No.

What fund options do you offer?

At this time, the Consolidated Fund, a high quality co-mingled investment portfolio, is the only fund option.

Are you mostly invested in index and mutual funds?

Yes. The quarterly review available on our website list the funds that make up the Consolidated Fund.

What is the diversification within these funds? Large-cap, mid-cap, small-cap. Domestic US vs. International?

The quarterly review shows the asset allocation of the funds within the Consolidated Fund.

Are there any minimum amounts for your funds?

A minimum amount of $2,000 is recommended, although it is not mandatory.

What is your frequency of interaction with your clients? e.g., monthly call plus event-triggered? Do you have non-church clients?

While all investors receive quarterly statements, Ryan and I both are available on-demand. We pride ourselves on being customer service driven and typically provide the same day response to a question or request.