Following is some general information regarding the establishment of an Endowment within the V. M. Ehlers Foundation, Inc. Even with a relatively small amount of money, TWUA Subsidiary Units and other groups can start a very worthwhile project. One such project is the establishment of a scholarship program - a great way to invest in the future of the water utilities profession. It is also a very fitting way to memorialize or honor someone who, after giving much to the water utilities profession, has passed from this life.
A TWUA Region, Section, District or Chapter - and even non-TWUA organizations - can assist their members - and the sons or daughters of the members -in furthering their education in a field of study related to the water utilities profession. This proposal also allows you to avoid the red-tape usually associated with maintaining a scholarship fund - and yet accomplish the wonderful purposes for the scholarship fund's existence.
This can be done through the formation of an Endowment within the framework of the V. M. Ehlers Foundation, Inc. Other organizations may also form Endowments, and specify that those who receive assistance from the Endowment be members of their organization and their children. Endowments may be named to memorialize a deceased individual for their life's work, to honor someone still living, or simply in the name of the sponsoring group. To date, there are 27 such Endowments in-place The name of these Endowments, with their sponsoring organization 's name shown in parentheses, are as follows:
- Atlas-Hinton Endowment (Hinton Classic Golf Tournament)
- Brazos-Colorado District Endowment (TWUA Brazos-Colorado District)
- Bob Batchelor Living Endowment (TWUA Capitol Area District)
- Central Texas Region Endowment (TWUA Central Texas Region)
- Betty Lockley Memorial Endowment (TWUA East Texas Region)
- Bob Derrington Memorial Endowment (Water Environment Association of Texas)
- Shirley Curtis Memorial Endowment (Mr. Raymond Curtis)
- North Central Texas Region Endowment (TWUA North Central Texas Region)
- Golden Crescent District Endowment (TWUA Golden Crescent District)
- Peddler's Tournament Endowment (TWUA Annual School Golf Tournament)
- Guadalupe Valley District Endowment (TWUA Guadalupe Valley District)
- Permian Basin District Endowment (TWUA Permian Basin District)
- Gulf Area District Endowment (TWUA Gulf Area District)
- Bill Secord Memorial Endowment (TWUA East Texas District)
- Hot Wells District Endowment (TWUA Hot Wells District)
- Laboratory Analysts' Section Endowment (TWUA Laboratory Analysts' Section)
- Southeast Region Endowment (TWUA Southeast Region)
- D. Ray Jones Endowment (TPWA Southeast Branch)
- Southwest Texas Region Endowment (TWUA Southwest Texas Region)
- Sam Warrington Living Endowment (TWUA Management Committee)
- West Texas Region Endowment (TWUA West Texas Region)
- Central West Texas Region Endowment (TWUA Central West Texas Region)
- Coastal Bend District Endowment (TWUA Coastal Bend District)
- W.T. "Doc" Ballard Memorial Endowment (TWUA Management Committee)
- Customer Service Section Endowment (TWUA Customer Service Section)
- Sam Houston District Endowment (TWUA Sam Houston District)
- Leon Holbert Living Endowment (TWUA Special Events Committee)
There are several advantages which can be realized by creating an Endowment instead of operating your own scholarship program. Some of these are discussed on the next page.
- There is no need to create a new tax-exempt organization. The V. M. Ehlers Foundation is an I.R.S. recognized 501(c)(3) publicly-owned foundation. The process of setting-up a new organization can be quite involved - and expensive, since professionals (such as accountants, attorneys, etc.) should be engaged to complete the process.
- Higher interest rates can be realized on the larger Ehlers Foundation "pool" of invested principal than could be realized through a smaller certificate of deposit or other type of investment. The total investment "pool" is over 300,000 dollars.
- Financial management of the Endowment, plus routine administrative functions, are performed by the Ehlers Foundation - through its Secretary/Treasurer, making it unnecessary for local volunteers or paid professionals to do so.
- Required annual reporting to the Internal Revenue Service is accomplished by the Ehlers Foundation. A very small administrative fee is involved, to cover the annual audit, but it is far less costly than that of having an accountant complete the reports for an independent scholarship.
- The sponsoring organization can maintain as much - or as little - control of the routine scholarship application, screening and selection process as it wishes. It may also chose to have it's representatives, or the Board of Trustees, handle those duties.
- All scholarships awarded by the Endowment receive coverage in the Texas Water Utilities Journal, which helps to increase awareness of the Endowment's good work.
Following this discussion there is (1) a sample of the Memorandum of Agreement which could be used to establish the Endowment, and (2) an Endowment Representative Arrangement designed for the sponsor to specify its representative and define his/her authorization to act in their behalf. As you review these forms, you will note there are only a few terms which the sponsoring organization agrees to:
- While an Endowment may be started with a smaller initial deposit (we suggest $500.00 as a minimum), scholarships may not be awarded from the Endowment until its invested principal balance is at least $5,000.00. At this point the endowment becomes fully vested.
- Once the $5,000.00 level is reached, the Endowment's sponsors may utilize the earned interest on the principal for the previous year (less the small administrative charge) for scholarship grants. In this manner, the invested principal remains intact to perpetuate the Endowment.
- Sponsors are encouraged to add to the principal balance on a regular basis. One half of these additional funds, referred to as "Enrichments", may also be utilized in granting scholarships. The other half of the Enrichments serve to make the Endowment grow for future years. In the alternative, the sponsoring organization of vested Endowments may designate funds added as a "pass-through" when there is a desire to grant more scholarships in a given period.
- Scholarship recipients must meet the eligibility requirements of the V. M. Ehlers Foundation (unless a specific waiver is granted by the Foundation's Board of Trustees).