Better Business Bureau Inc

PART V, LINE 4:

“Intended uses of the organization's endowment funds: the endowment fund was established to provide assets which, through investment, will provide income to support the better business bureau in the furtherance of its purpose. Earnings: all investment earnings (interest and dividends but not capital gains) shall be periodically transferred to the better business bureau's operating account to be used for program support consistent with budgetary requirements. Withdrawals of principal: the finance committee shall annually determine the maximum amount of principal that may be withdrawn from the endowment fund in any given year according to the spending rule below. The board of directors hereby delegates discretionary authority to the finance committee to authorize any and all such withdrawals up to this maximum amount based on the financial needs of the organization. Extraordinary withdrawals of principal: the board of directors, upon the recommendation of the finance committee, may authorize the withdrawal of additional monies-for special operational or capital expenditure purposes-in excess of the annual maximum amount described above. Any such extraordinary withdrawal can be made only after the affirmative vote-in person at a meeting of the full board of directors-of two thirds of the board of directors then in office. Investment: the finance committee will direct the investment of the endowment monies. The goal is to maximize growth of the fund in order to provide 1) operating funds and 2) a source of funds in the event of unusual or extraordinary financial need. Spending policy: the spending rule is used to determine the maximum amount of principal that may be withdrawn from the endowment fund in a given year ("annual compensating distribution"). The annual compensating distribution is calculated for the upcoming fiscal year (which is the calendar year for bbb) in the 4th quarter of the current year, as follows: five percent of the average fair value of the endowment fund on september 30 of the current year and each of the two preceding years; less: actual investment earnings (interest and dividends but not capital gains) of the endowment fund during the four quarters ending september 30th of the current year; equals: annual compensating distribution for the upcoming fiscal year. For example, the annual compensating distribution for fiscal/calendar 2021 would be five percent of the average fair value of the endowment fund at september 30, 2021, september 30, 2020; september 30, 2019, less actual interest and dividends earned by the endowment fund between october 1, 2020 and september 30, 2021. The compensating distribution is a discretionary payment to be considered based on the organization's financial need. At its discretion, the finance committee may authorize compensating distributions periodically during the year (e.g., quarterly); however, these "interim" distributions will be reconciled annually based on the spending rule above.”