Michigan Gateway Community Foundation has developed several types of funds to meet donor and community needs. Our staff works with you and your adviser to help you determine which type is right for you.

Many donors place no restrictions on how their gifts are to be used. However, you may design your fund around very specific goals. Even if the current intent of the fund becomes obsolete, the Community Foundation will ensure that the fund continues to address emerging community needs. For more information on the unique structural feature that makes this flexibility possible, click on the link below to learn about the Variance Power that is a part of each of our fund agreements.

Any fund can be permanent (endowed), long-term (allowing spending from principal when appropriate), or temporary (allowing funds to be completely spent for grants within a specified time).

Unrestricted

The most flexible funds within the Foundation, unrestricted funds are those for which the donor allows the Foundation discretion in the use of the annual income for a broad range of community projects. This provides the Community Foundation the opportunity to respond to changing community needs.

Field-of-Interest

With field-of-interest funds, the donor directs the Community Foundation to utilize the annual income in a certain program area. The Community Foundation determines the specific grant recipients. Educational scholarships may be awarded from field-of-interest funds.An educational field of interest fund can be used for scholarships, but can also be used for other types of educational support. When deciding what type of fund to create, consider what $500 can do for one college student. And then consider what $500 could do for a 5th grade science class of 25 students.

Donor Advised

Donor advised funds allow the donor to actively participate in the grantmaking process by recommending to the Community Foundation the purpose and organizations that receive the annual income. Recommendations are referred to the Community Foundation’s Board of Directors for approval. Many advised funds become unrestricted on the death of the donor or at the end of a specified period.Temporary donor advised funds work just like an endowed fund with the exception that the minimum establishing gift is $1,000. Use this option for end-of-year giving to multiple charities. You can write a single check or give stock to your community foundation, get one gift acknowledgment for tax purposes, and still make gifts to several charities.

Designated

Designated funds are funds in which a donor has specified the charitable recipient, or recipients, of the income at the time the fund is established.

Agency Endowments

Other nonprofit organizations often place their endowment funds within the Community Foundation for management and investment purposes. The Community Foundation regularly distributes the annual income back to these agencies to help them accomplish their charitable purposes.

Special Projects and Memorial Funds

Our primary mission is to establish permanent funds, but we recognize that at times we can better serve the donor and the community through creating a temporary fund. Any type of fund can be a temporary fund; special project, memorial, and donor advised funds are the most common.

Variance Power

One of the attractive features of using the services of the Community Foundation is provision in our Bylaws and in fund agreements which gives our Board of Trustees the authority to change a fund’s purpose without going through a protracted and expensive process of seeking court permission to do so.The long passage of time can sometimes cause a charitable purpose to become outdated. For example, a person may have left a large fund to provide for research toward a cure for polio. When a vaccine was discovered, the assets in their well-intentioned fund would go unused.To avoid the risk of obsolescence, a “variance power” provision is added to all agreements establishing funds with a specific or designated purpose or restricted to a particular field of interest. It states that the fund is subject to the Community Foundation’s Articles of Incorporation, Bylaws, and policies including the variance power which allows the Board of Trustees of the Community Foundation to modify any restrictions or condition on the distribution of assets for any specified charitable purpose or to specified organizations, if, in their sole judgment, such restriction becomes, in effect, unnecessary, incapable of fulfillment, or inconsistent with the charitable needs of the area served by the Community Foundation. Fund holders appreciate this feature which assures them that should the purpose, organization, or need specified as the beneficiary of their fund ever ceases to exist or becomes obsolete, their funds will be used for a new purpose as close as possible to the one named in their original fund agreement.