The latest Winifred-Asbjorn Scholarship recipients (L to R) are freshman Chad Molden, Danielle Urick and Kevin Arntzen. Photo by Rick Jackson Endowments: the foundation for the future by: Rick Jackson An endowment is one of the most enduring, abiding gifts a donor can give to MSU because it is a permanent financial resource. An endowed gift is held and invested in perpetuity, which means the donor's original gift is never spent. Only a portion of the investment earnings is spent for the purpose that has been specified in a gift agreement with the donor. Examples of endowment gifts include scholarships, professorships, faculty development, research or general support. No matter how an endowed gift is planned and directed, it offers long-term financial stability. When a donor gives assets to the Foundation with the stipulation that the gift be held in an endowment, there are two options. The gift is either added to an existing endowment fund that meets the donor's purposes or it establishes a new endowment that is specific to the donor's gift. That becomes a named endowment fund. The dollar amount required to establish an endowment varies with its purpose. For example, a gift of $15,000 will create a separate named endowment that will support one scholarship. Similarly, a gift of $25,000 or more will create a separate named endowment that will support one scholarship based on further specified criteria such as class status, curriculum, financial need or GPA. The endowment needed to generate an annual stipend and funding for a visiting professorship is $1 million; the salary and expenses for an endowed faculty chair is $2 million. The assets transferred to the Foundation for the purposes of establishing an endowment are then invested in a professionally managed portfolio of various funds that hold bonds, common stocks, cash equivalents and alternatives. The portfolio is invested in a mix of assets that provide for safety of the principal, steady growth over the long term, and for current income. The Foundation's board of directors investment committee oversees the investments and reviews the investment policy at least once a year. The board also sets a spending policy, or the amount of the investment income that may be spent on endowment funds. The current spending allows for 4 percent of the invested balance of an endowment to be made available to the university to support the area or program the donor has specified. Investment earnings in excess of 4 percent are reinvested with the endowment to provide growth as well as to support general administrative expenses at a rate of 1.75 percent. The purchasing power of the investment is thereby preserved over time. Additional gifts can be made to the endowment at any time. The donor, with help from the Foundation, determines the name and specific use of the fund. A wide range of needs can be met through the establishment of an endowment. The motivation to set up an endowment varies greatly from donor to donor. Every set of circumstances is different, but the end result is the same: a gift that transcends time and perpetually bears fruit. Two examples of recently created endowments underscore the unique and creative possibilities available to donors. Winifred native Norm Asbjornson, '60 ME, '04 Hon Doc, made a generous gift of $100,000 in 2003 which established the following endowments: The Winifred-Asbjornson Scholarship, available to graduates of Winifred High school attending MSU; and the Winifred-Asbjornson Rural Education Initiative which was a gift to the Burns Telecommunications Center at MSU. This gift to the BTC will enrich and broaden the curriculum of rural schools through the use of two-way interactive video connecting students with experts in various fields. This use of evolving technologies and resources to enrich learning will help expose rural students like those in Winifred to some of the issues and decisions that will help them prepare for college and career options. Asbjornson, who serves on the MSU Foundation board and the MSU Engineering Advisory Council is founder, president and CEO of AAON, Inc., a Tulsa-based air conditioning manufacturer. He previously made a $1 million gift to establish the Asbjornson University Scholar permanent endowment, which supports four-year renewable scholarships for incoming freshmen who are graduates of Montana high schools with a total enrollment of 100 students or less. "Endowments are truly the key to enhancing the quality of MSU programs and helping our students," says MSU Foundation President and Executive Director Dave Gibson. "They enable us to provide MSU not only an extra level of current support that is so needed, but also ensure that such support will be there forever." For more information about the Montana State University Foundation, please visit their website at www.montana.edu/foundation.