Create Your Own Fund

Establishing a fund is created with $25,000 cash, or non-cash gifts such as real estate, securities, or life insurance. For more than 30 years we have been helping people turn their good intentions into meaningful a impact across Frederick County. We have the expertise to help you achieve your philanthropic goals.

There are Two Categories of Funds

One of your considerations in creating a fund is determining what fund type will help you carry out your charitable goals. Learn about the types of funds, and reach out to our staff for help navigating your options.

Permanent Funds – gifts to permanent funds are never spent. Gifts are invested, and a portion of the fund is used to fulfill the fund’s charitable purpose. Permanent funds may be endowed or quasi-endowed.

Pass Through Funds – gifts to pass through funds, along with the fund’s investment return may be used to fulfill the fund’s charitable purpose at any time during the life of the fund.

Permanent and pass through funds may be any of the following fund types:

Unrestricted Fund

For the donor who chooses to give a gift with no restrictions, an unrestricted fund allows the Community Foundation’s Board of Trustees to allocate the proceeds from your fund to the most appropriate charities. Because the charitable needs of the community are continually changing, you may feel that a group of living individuals will be better able to assess current situations than a written document from the past. An unrestricted fund is most suitable since these all-purpose funds are the most flexible in meeting the emerging needs of the community.

Field of Interest Fund

A field of interest fund allows a donor to specify general areas to direct grantmaking, but not specific nonprofits.

Designated Fund

For the donor who wants to designate favorite charities, a designated fund allows you to direct the proceeds from your fund, specifying the amounts or percentages to each charity. If one of the organizations ceases to operate or no longer offers the type of service that interests you, we will find one that does—so that your gift remains vital and meaningful.

Donor advised Fund

For the donor who would like to be involved with the fund, a donor advised fund allows you to maintain an advisory role in how the proceeds from your fund are disbursed. The Community Foundation’s Executive Committee and/or the Board of Trustees must approve all grants awarded from any fund. The proposed gift must fit within the charitable purposes of the Community Foundation and within specific Internal Revenue Service requirements. You offer advice during your lifetime and may designate a family member to make advisements once you are no longer living. Otherwise, the fund may become an unrestricted fund or a restricted fund according to your instructions. Read the Community Foundation’s donor advised fund policies.

Donor advised fund founders and authorized representatives now have access to a donor portal to access information about their fund. Frequently asked questions about the portal can be found below.

What can I use the donor portal for? The donor portal is a great way to access your donor advised fund market value and award grants from the fund. It is also a way to receive communications about your fund from the Community Foundation.

Why should I utilize the donor portal? The donor portal gives you access to your donor advised fund information 24/7. This enables you to access information or submit grant recommendations at your convenience and outside of typical Community Foundation business hours.

Who can use the donor portal? Right now, the donor portal is only accessible to donor advised fund founders and authorized representatives. Availability will be coming for other fund types at a later date.

How do I get started? To get started, go to this webpage and click on the word “register” to begin your registration process.

What do I do if I get locked out of my donor portal? Go to the donor portal. There you can get a hint to your password or reset your password. If you are still having difficulty, contact Becki DeLauter at b.delauter@FrederickCountyGives.org for additional support.

Scholarship Fund

For the donor who would like to provide financial assistance to students pursuing a post-secondary education, a scholarship fund is an excellent option. Donors indicate the scholarship criteria and may serve in the minority on the scholarship selection committee.

Agency Fund

An agency fund allows a nonprofit to partner with the Community Foundation by taking advantage of its expertise in managing charitable funds. The result helps the nonprofit further their mission by ensuring long-term financial support.

Fiscal Sponsorship Fund

A fiscal sponsorship fund allows start-up organizations and groups addressing an emerging or short-term need to work with the Community Foundation.

Fees

Administrative fees, or community investment fees, support mission-based operations at the Community Foundation. These fees are your investment in a local 501c3 public charity dedicated to improving the quality of life in Frederick County. Fees vary depending on the type of fund and fund balance, and are deducted directly from the fund.

Investment management fees are deducted from your fund to cover the costs of managing the investments in your account. These fees will vary depending on the options you select for investment management when you open your fund, and the size of the fund. The Community Foundation does not receive any portion of the investment management fees.

Incidental or extraordinary fees may be charged for direct expenses incurred by the Community Foundation on behalf of a specific fund, such as commissions for the sale of contributed stock, legal fees and credit card processing fees for online donations made to the fund.

Investment and Distribution of Fund Monies

Since 1986, the Community Foundation has invested more than $94 million back into the community, thanks to thousands of generous donors.

The investment and distribution of fund monies is an important part of what we do and we take the process and the responsibility seriously. It is important for donors and prospective donors to understand the process. As part of a sound investment practice, the Community Foundation diversifies its portfolio into many different asset classes and investment vehicles, including mutual funds, separate accounts, and partnerships.  These investments can include investments in internationals and real estate to aid in maximizing its investment return in the long term.

Who invests the Community Foundation's funds, and how are they invested?

Professional investment managers safeguard and invest the Community Foundation’s funds. An investment committee comprised of members of the Community Foundation’s Board of Trustees and others with investment expertise sets the overall investment policy and monitors the performance of these managers. The Community Foundation’s accounts are audited annually by an independent auditor and are available for public review.

Funds are invested according to their investment objectives in the growth, balanced growth, balanced income, and maintenance of principal options. Details about the Community Foundation’s fund managers, investment options and investment policies can be found in the Fund Performance document and the Statement of Investment Objectives and Policies document.

What is the $500,000 policy?

Under the Community Foundation’s “$500,000 policy,” donors who create funds with $500,000 or more may recommend an investment option – either using the Community Foundation’s pooled funds, as stated above, or an alternative one. The Community Foundation’s Investment Committee considers all suggestions and presents its final investment recommendations for investments to the Board of Trustees based on the best way to achieve the fund’s purpose and impact. The Board of Trustees is not bound nor obligated to approve any recommendations. The Community Foundation’s current investment managers for funds invested within the “$500,000 policy” are:

  • The Family Heritage Trust Company
  • First United Bank & Trust
  • Maryland Financial Planners
  • Merrill Lynch
  • Morgan Stanley Private Wealth Management
  • Wells Fargo Advisors LLC

For more information about these investment managers or their rates of return, please contact the Community Foundation.

How does the Community Foundation meet its operating expenses?

One hundred percent of each donation specifically earmarked for a particular fund is added to that fund. Thus, the Community Foundation meets its operating expenses in three ways:

First, the Community Foundation receives many gifts from donors designated for operating expenses, including gifts received from members of The Widening Circles Society and Partners in Philanthropy campaigns.

Second, the Board of Trustees solicits gifts to be placed in a special fund called The Administrative Endowment Fund to support operations.

Third, each fund is assessed a small management fee to help offset the costs of administering the Community Foundation. The Fund Types and Management Fee document explains fees and minimum distributions for scholarships and grants (both for funds established prior to July 1, 2014, and new funds established on or after July 1, 2014).

How are monies from funds distributed?

The Board of Trustees has established a policy of appropriating 5 percent of the previous year-end fund balance to the charitable cause for which the fund is intended to support. Allocations from the Community Foundation’s funds are made by the Board of Trustees, according to the agreement made between the donor and the Community Foundation.

Grant Distributions: All requests for grants from unrestricted funds are first reviewed by the Community Foundation’s Grants Committee. Recommendations are then presented to the full Board for consideration and approval.

Grant distributions from donor-advised funds may be made at the written recommendation of the fund’s authorized representative, or via the Donor Portal. The proposed grant must fit within the charitable purposes of the Community Foundation and within specific Internal Revenue Service requirements. The Community Foundation’s Executive Committee and/or the Board must approve all grants awarded from any fund. Additionally, grant recommendations must pass due diligence requirements.

Allocations and grants are made to tax-exempt, not-for-profit charitable organizations primarily serving Frederick County in the areas of education, the arts, health, social services, and the conservation and preservation of historical and cultural resources. Distributions from designated funds are sent annually to the charitable cause for which the fund was intended.

Grant amounts from unrestricted funds vary depending upon the nature and needs of the organizations and the fund’s investment return.

The Community Foundation’s annual grantmaking process distributes monies from unrestricted endowment funds as well as several other funds. Please check the website for access to the application and guidelines for the various grant cycles administered by the Community Foundation.

Scholarships: Scholarships are awarded annually through an online application and review process with consideration of specific scholarship fund guidelines.

Is information about my fund confidential?

The Community Foundation considers the security of its records and its confidentiality regarding donors and contributions to be of the utmost importance. The Community Foundation’s records are never sold, shared or used by other organizations. When a gift is made to a fund, the fund’s founder or authorized representative is notified of the donor’s name and contact information, but not the amount of the contribution. Exceptions to this practice may be made at the donor’s request.

Reference documents

These documents provide additional information regarding the investment and distribution of fund monies: