Recently there has been discussion among some church members about the purpose of our church endowment funds and whether they should be tapped to fund major maintenance and repair and special projects. Here, our congregation-elected Endowment Team is providing its perspective on the issues raised by these conversations.

We begin with a brief history. The church’s small endowment of around $10,000 began to grow in the 1990s, increasing to about $100,000 in 1999 after significant donations from the estates of Katherine Gellhorn and Mary Lee Chesnut. Between 2002 and 2011, Endowment distributions of around $30,000 were made for a variety of projects requested by different teams, including the Transylvanian gate, installation of the Harold Balazs lights on the front walkway, RE furniture, landscaping, CO2 sensors, and the ministerial search that brought us the Rev. Dr. Todd Eklof.

The fund, managed in a Vanguard account by Tom Mosher and Dan Eacret, grew to $200,000 by 2011. The Endowment Team then determined that the fund was large enough to require professional management. The Team researched several options and chose the Unitarian Universalist Common Endowment Fund (UUCEF), which was at the time part of the UUA, for both its professional management and investments reflecting UU values.

The UU board signed a management agreement with UUA, and the first deposit was made in December 2011. By that agreement UUA legally owned the monies and managed the UUCEF for the benefit of participating congregations. The UUCS and other churches held prorated positions in the pooled assets.

In 2012 the UUCEF was spun out of the UUA and turned into a separate LLC, with individual churches assuming liability for fund losses as UUCEF “share-holding members.” The UUCS board signed a new operating agreement with UUA in 2012 that endorsed this arrangement, which also stipulated that if our church ever dissolved, our endowment funds would be owned outright by the UUA. As with the 2011 agreement with the UUA, the 2012 agreement with the LLC vested the ownership of the endowment funds in the LLC, with the UUCS holding units of the LLC.

In 2013, when the fund had reached $300,000, the UUCS board approved an Endowment Team proposal to halt all disbursements until the fund reached $500,000. The reasoning: a larger fund could make a significant contribution to the UUCS annual budget, reducing our dependence on annual pledges by members.

The $500,000 goal was reached by 2017, and the fund began distributions to the UUCS operating budget, distributing $17,000 for the 2018/19 fiscal year. Holding to a practice of sustainably prudent withdrawals, annual distributions have risen in every year since, with $42,200 allocated to the church’s operating budget for this year’s budget (2026/27). Distributions recommended by the Endowment Team annually and specified in percentages, have been between 4.0% and 4.5% of overall Endowment valuation, based on a 13-quarter rolling average.

In 2021 the Endowment Team recommended moving endowment funds out of the UUCEF in Boston and investing them closer to home, largely due to our congregation’s concerns about the future direction of the UUA and the contract language that stipulated that UUA would become the owner of any funds belonging to a church that dissolves. After board approval of the recommendation, the Team spent several months exploring our options, including interviews with investment managers at Schwab, the Innovia Foundation in Spokane, and the Seattle Foundation. While researching we had parked our funds from the UUCEF in a bank account in Spokane. By serendipity, this move shielded our monies from declines in value during subsequent steep downturns in the market.

Eventually we proposed — and the board agreed — that the funds (at that point approximately $715,000, counting recent contributions) would be moved to a Reserve Fund at the Seattle Foundation, the largest community foundation in the Pacific Northwest, with over $965 million in assets.

This Reserve Fund is not a true endowment fund as created by federal and state law, which caps distributions without input from participants. Rather, the Reserve Fund is a vehicle whereby the UUCS engages the Seattle Foundation to manage our funds as a fiduciary on our behalf. There is also no legal cap on annual withdrawals by the UUCS. That said, the Endowment Team has adhered to its practice of prior years, and makes only sustainably prudent annual withdrawals, in the 4%–5% range.

If we continue this course of investment, our contributions to the church’s annual budget will continue to rise over time, further easing pledging pressures. If we do not adhere to that strategy and take large amounts of money out of the fund for capital projects, the fund will dwindle, and pledge pressures will again rise.

This approach accords with the majority will of the Congregation, which voted to include the following language in the Bylaws of the Church at its Congregational Meeting in June 2022:
Article XI, Section 1: “The purpose [of the Endowment] is to assure long-term financial stability of the Church, by providing monies annually, sustainably, and in perpetuity to the Church’s general operating fund.”

This language, written by the Board and approved nearly unanimously by the Congregation, is evidence that our church endorses management of the endowment as a sustainable, long-term source of income to the budget. As Tom Mosher, our parliamentarian, has already stated in an analysis for the Board, “ ‘Perpetuity’ means ‘the state or quality of lasting forever.’ “

As your Endowment Team, that is the course we intend to pursue to guarantee a solid financial future for our church.

March 2026
The Endowment Team: Sue Stiritz & Mary Giannini, Co-Chairs, Dan Eacret ,Tom Brattebo and Shane Gronholz
With thanks to Karen Dorn Steele for the above history and analysis.