Endowment Investment and Spending Policy

Revised:    December 13, 2004
  1. INVESTMENT OBJECTIVES

    The endowment investment goal of Brigham Young University - Idaho (the University) is to achieve a total rate of return on institutional endowment funds which will allow the University to (1) fund current needs through endowment income (2) allow sufficient retention of earnings in the endowment to significantly offset the impact of inflation. These goals are to be achieved through prudent selection of investments within the parameters of the Idaho Uniform Prudent Management of Institutional Funds Act, Chapter 50, Title 33, Idaho Code ("UPMIFA").

  2. INVESTMENT COMMITTEE

    The Investment Committee consists of the President, and University Resources Vice President and three other individuals appointed by the President. The Investment Committee sets asset allocation benchmarks, acceptable asset allocation ranges and current target allocations. The Committee performs its duties in accordance with the University Investment Management Policies and Procedures and reports to the CES Investment Oversight Working Committee.

  3. INVESTMENT ADMINISTRATION

    All University investment accounts and funds are administered by University Financial Services. The Managing Director of Financial Services shall be responsible for the day-to-day administration and investment of all institutional endowment funds consistent with directives of the Investment Committee and policies of the University.

  4. INVESTMENT POLICY

    The Investment Committee shall determine the appropriate mix and allocation of institutional endowment funds and may use a variety of investments. Preference shall be given to available Church pools when they meet the mix and allocation objectives of the Investment Committee. Investments shall be well diversified among different investment options and styles to avoid major negative fluctuations of any particular investment sector.

  5. SPENDING POLICY

    Annual appreciation, including realized and unrealized gains or losses on investments and interest, dividend, and other income, will be treated as current gains and losses for the purpose of determining net investment income available for expenditure in accordance with UPMIFA. The annual amount available to be spent is limited to 4.5 percent of the market value of the endowment at the beginning of the current year. Such income will be allocated at the end of the year and is available to be spent on the first day of the subsequent year. The balance of net investment income or deficit shall be retained in the endowment account. In no event shall funds be allocated for expenditure if the value in the account is below the historic dollar value as defined by UPMIFA or if such expenditure would result in the value of the endowment dropping below that level.