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| The Rolland L. Adams Society |
The Lehigh Valley Community Foundation provides you with a professional and convenient way to implement your charitable plans through a wide variety of Funds of the Foundation. Giving to the Foundation can be as simple as making a gift, in any amount, to one of the existing funds of the Foundation or as sophisticated as the establishment of a multimillion-dollar supporting organization. With a minimum gift of $10,000, the Foundation permits donors to establish named funds that will serve their charitable intentions temporarily or in perpetuity. This service is available to individuals, families, businesses, and non-profit organizations. The foundation also welcomes the transfer of private funds and foundations.
Funds of the Foundation
Funds of this type are designed for donors who desire breadth and flexibility in their support of the non-profits in the Lehigh Valley. Such funds permit the Foundation's Grants Committee maximum discretion in making all grant recommendations, depending on the evolving needs of the community. Grants are given to programs that address key community needs and to programs that preserve and enhance the community's strengths and assets. The Grants Committee receives and reviews applications for grants on an open and competitive basis. After an extensive evaluation process, the Committee makes its recommendations to the Foundation's Board of Governors. The Foundation's discretionary grants are given to organizations and programs serving Arts and Culture, Community Betterment, Education, Environment, Health Care, History and Heritage, Human Services and Science.
Donors of Designated Funds identify specific organizations or programs to annually receive grants from their funds.
- The Smith family establishes the Smith Family Fund with the provision that grants from the Fund are to be made annually to their place of worship, a local hospital, and a university in California.
- Joe Brown begins a Designated Fund in memory of his mother and specifies that grants from the Fund are to be given to the Senior Citizens Center each year.
Area-of-Interest Funds
Donors who create Area-of-Interest Funds tend to have general areas of interest or commitment, such as the arts or education or children-at-risk. They often, however, do not wish to tie their grant making to specific organizations or to preclude funding of new organizations that emerge with more creative and effective solutions to community issues. In such a case, the Foundation's Grants Committee is then responsible for making grants to programs and organizations serving areas of interest identified by the donor. Example: a large manufacturing firm establishes an Area of Interest Fund, saying that it wants 25 percent of the grants from the fund to go to education, 25 percent to arts, 25 percent to health care, and 25 percent to human services. The Grants Committee makes grants accordingly.
Donor-Advised Funds
Donors with diverse and changing charitable interests often choose Donor-Advised Funds. The name says it all: donors advise the Foundation regarding grants which they'd like to have made from their funds. Example: Mr. and Mrs. Taylor begin a Donor-Advised Fund and choose to recommend three grants to arts programs in year one. The next year, they decide to target their recommendations toward children's issues, and they recommend a grant to the United Way, several grants to youth organizations, and one grant to a school for the disabled. In the third year, they want to support their community's anniversary celebration, and they recommend that a grant be made to the community's library.
Organizational Endowments
Many organizations throughout the Lehigh Valley — including non-profits, churches, clubs, and other community organizations — have been successful in gathering funds from diverse supporters, but have neither the expertise nor the time to manage such assets effectively. In such a case, an organization may choose to open an Agency Endowment Fund at the Community Foundation with the stipulation that grants from this fund be used to support the organization. Example: The Evergreen Garden Club may begin a permanent fund that will provide grants for operations and programs to the organization in perpetuity. The Evergreen Garden Club may also name an organizational beneficiary to receive the grants if the Evergreen Club ceases to exist.
Scholarship and Award Funds
Scholarship and Award Funds provide general support for education. They benefit students graduating from a specific school or attending a specific school. Scholarships are almost always directed at the educational institution for tuition payments. The funds often carry the name of the donor or family member, the school district or filed of education that the scholarship or award serves.
All of the funds listed above may be either Temporary or Permanent.
Permanent Funds...
...are endowments which will remain in perpetuity. Grants will be made according to the provisions of the Fund Agreement, depending on the type of fund the donor has chosen. Permanent Funds are governed by the Foundation's Spending Policy, set annually by the Foundation, which defines what percentage of a fund's assets are available for grants. The Foundation's current Spending Policy is set at 4.5%, meaning that 4.5% of the average value of the fund as calculated over twelve rolling quarters is available for grants annually. This limit is set in order to allow the funds to grow and to preserve the purchasing power of grants from the funds.
Temporary Funds...
...are funds for which it is expected that the entire income and principal — all of the assets of the fund — will be used up over the course of two to five years. This time period is very flexible, depending on the needs of the donor and the purposes of the fund.
Whether the gift will establish a named fund or support an existing fund of the Foundation, gifts to the Foundation may be made in a number of ways, depending on the specific charitable interests and tax requirements of the individual donors. The Foundation will work closely with current or prospective donors to determine which types of gifts would be most effective in meeting donor goals and objectives. Gifts to the Foundation permit full charitable deduction for donors in accordance ith the law.
Generally, the Foundation accepts gifts in the following forms:
Outright Gifts (gifts made in the present):
Cash
Securities
Stock Certificates
Securities Held by a Bank or Investment Manager
Closely-Held Stock
Real Property
Personal Property
Life Insurance Policies
Donate a fully paid-up life insurance policy
Donate a partially paid-up life insurance policy
Purchase a new life insurance policy
Planned Gifts:
Bequests
Specific Bequests
Residuary Bequests
Contingent Bequests
Trust Remainder Bequests
Real and Personal Property
Life Estate Agreements
Charitable Gift Annuities
Charitable Remainder Unitrusts
Charitable Remainder Annuity Trusts
Charitable Lead Trusts
Supporting Organizations
Outright Gifts:
The easiest way to support the work of the Foundation is by making a cash gift. To make a gift of cash, you may send a check payable to the "Lehigh Valley Community Foundation." If you would like to have your gift applied to an existing Fund of the Foundation, please indicate that purpose on your check. You may mail your check to:
Lehigh Valley Community Foundation
961 Marcon Boulevard, Suite 300
Allentown, PA 18109
Publicly-traded and closely-held stocks and bonds may be given to the Foundation and are accepted at fair market value as determined under the rules set forth by the Internal Revenue Service. Gifts of stock are considered to be complete on the "date of delivery," which determines the tax year in which the gift is deductible and the value of the gift.
Stock contributions are completed when certificates are delivered unconditionally and in negotiable form:
- To an authorized representative of the Foundation;
- To the Foundation in person or by private carrier;
- Through the regular U.S. mail with the postmark serving as the date of the gift; or
- By a broker or banker transferring the stock into the Community Foundation's account.
Gifts of securities to the Community Foundation may be made in the following ways:
If the securities are in your possession, mail the unendorsed certificates to:
Ms. Trisha R. Higgins
Lehigh Valley Community Foundation
961 Marcon Boulevard, Suite 300
Allentown, PA 18109In a separate envelope, mail to the same address one signed stock power form for each security you are contributing, leaving all other information to be completed by the Foundation. Stock power forms are available from your banker, broker, or from the Foundation. Please include a note with your name and address and the purpose of your gift.
You may also bring stock certificates you intend to donate directly to the Foundation.
Securities Held by a Bank or Investment Manager
If the securities you intend to donate are held in a bank or brokerage account, you may electronically transfer them to the Community Foundation's account with that firm. If you are planning to make such a gift, please call (610-266-4284) or the Foundation requesting instructions to transfer the securities.
A gift of real estate may be made in the form of undeveloped property, a personal residence or farm, rental property, or commercial property.
If you are interested in donating real property, please contact the Foundation at 610.266.4284.
The Foundation's Gift Acceptance Committee will carefully examine each piece of real estate prior to its acceptance as a gift in order to reduce the possibility of liability issues related to the Foundation's owning the property. The Foundation retains final authority to accept or not accept gifts of real property.
You may also donate to the Community Foundation books, artworks, stamp collections, and other forms of valuable items of personal property. When considering a gift of this type, it is suggested that you consult the Foundation and your own advisors.
Giving a life insurance policy is an inexpensive way to make a substantial contribution to a charity. Many people find in later years that they don't need all the insurance they did when they were younger. Donors can name the Community Foundation as sole beneficiary, designating that grants be made to your organization or a specific program, and transfer ownership of unneeded life insurance policies.
Once transfer is complete, your donation may be immediately eligible for a tax deduction on the computed current value of the paid-up policy. If your donor is still making annual premium payments, those payments will also qualify for a charitable deduction.
Since the insurance policy is owned by the Community Foundation from the day it is transferred, it is not part of the estate and is not subjext to tax.
Donors can use assets held in an individual retirement account (IRA), 401(k), 403(b) or similar account to start a fund at the Community Foundation at the time of their death. Many donors choose to donate all or part of their retirement plan to the Community Foundation. These accounts, while very attractive to defer tax during lifetime, are the most heavily taxed assets in an estate at death.
To make a gift using retirement assets, your donor fills out a form with the plan administrator designating the Community Foundation as a beneficiary designating that grants be made to your organization or a specific program. There is no cost, and the beneficiary designation can be changed at any time.
Planned Gifts:
You may feel that you are able to make a larger gift to the Community Foundation through your will than you could during your lifetime. Your bequest may be in the form of a specific amount of cash or property, or a percentage of the remainder of your estate. In either case, a bequest to the Community Foundation is deductible for federal estate tax purposes. You may contact the Foundation with regard to specific language to be included in your will, should you wish to name the Foundation as a beneficiary.
When a donor remembers the Community Foundation in their will, they can create a living legacy will address the needs of today and the challenges of tomorrow.
Specific Bequest: you designate the Community Foundation to receive a specific dollar amount.
"I give and bequeath to the Lehigh Valley Community Foundation, Allentown, PA, (% or$) to be held, administered and used by the Board of Governors for support of the Lehigh Valley Community Foundation in the area of greatest need and opportunity." (or designate the organization or interest area of your choice.)
Residuary Bequest: you give the Community Foundation all (or a portion thereof) of your property, afer all debts, taxes, expenses and other bequests have been paid.
"I give and bequeath to the Lehigh Valley Community Foundation, Allentown, PA, all of the rest, residue and remainder of my estate, both real and personal to be held, administered and used by the Board of Governors for support of the Lehigh Valley Community Foundation in the area of greatest need and opportunity." (or designate the organization or interest area of your choice.)
Contingent Bequest: in the event of an unexpected occurence, a contigent bequest will ensure that property will pass to the Community Foundation rather than unintended beneficiaries.
"I give and bequeath to the Lehigh Valley Community Foundation, Allentown, PA, all of the rest, residue and remainder of my estate, both real and personal to be held, administered and used by the Board of Governors for support of the Lehigh Valley Community Foundation in the area of greatest need and opportunity." (or designate the organization or interest area of your choice.)
Restricted Bequest: you may prefer to restirct your bequest for a specific purpose. A restricted bequest should be made in the broadest terms that are consistent with your purpose.
"I give and bequeath to the Lehigh Valley Community Foundation, Allentown, PA, all of the rest, residue and remainder of my estate, both real and personal to be held, administered and used by the Board of Governors for the establishment of an endowed __________ fund for support towards which the Foundation's Grants Committee directs funding. The fund shall be named, __________."
A Charitable Gift Annuity is an irrevocable contract between a donor and the Lehigh Valley Community Foundation. The donor makes a one-time tax deductible gift to the Lehigh Valley Community Foundation. In return for your donor's contribution, and pursuant to signed agreement, The Lehigh Valley Community Foundation guarantees payment of lifetime income at a fixed rate. Income payments are determined by the annuitants' ages and the amount of the gift. These rates depend upon the value of the initial gift, the number of annuitants and their age, and the return generally available on conservative investments. Rates are set by the National Council on Gift Annuities. Single or two-life annuities are available. Upon the death of the donor or last surviving beneficiary, the amount remaining in the CGA will remain at the Lehigh Valley Community Foundation to support operations and grantmaking, thus helping to build a base of philanthropy to serve the Lehigh Valley in perpetuity. If the amount remaining in the CGA is sufficient, a named fund will be created in honor of the donors.
The annuity can be contracted through a minimum contribution of $10,000 in cash or marketable securities.
Charitable Remainder Unitrusts
A Charitable Remainder Unitrust pays the life income beneficiary a percentage of the fair market value of the trust assets, as revalued annually. This fixed percentage, no less than five percent (as dictated by the IRS), is determined jointly by you and the Lehigh Valley Community Foundation at the time that the trust agreement is prepared. Income is paid on a quarterly basis. As with other life income gifts, however, a higher income rate for the unitrust will lower the charitable deduction and provide for a smaller growth of the principal which ultimately goes to the Foundation. A high payout rate for the unitrust also weakens its ability to pay out more income as the principal grows.
Because the unitrust requires individual financial management and entails specific start-up costs, the Community Foundation has set a minimum contribution level of $100,000. Additional contributions can be made to the trust in any amount.
Unitrust income is taxed to you based upon the trust investments and, therefore, may be created with, or invested in, tax-exempt securities that will provide tax-free income for the trust beneficiaries.
Charitable Remainder Annuity Trusts
A Charitable Remainder Annuity Trust is the same type of gift vehicle as the unitrust, with the exception that the income payment is a fixed dollar amount established at the time of agreement. This amount must reflect at least five percent of the initial market value of the assets of the trust. Unlike the unitrust, however, the annuity trust provides you with a predictable income each year regardless of fluctuations in earnings or value of the portfolio. It cannot accept additional assets after the trust has been established.
A Charitable Lead Trust is a mirror image of the charitable remainder trusts. It is a method of transferring assets to your heirs with minimum gift and estate taxes, while contributing to the support of the Community Foundation during or after your lifetime.
A lead trust pays a fixed annual percentage (Charitable Lead Unitrust) or fixed dollar amount (Charitable Lead Annuity Trust) to the Community Foundation for the duration of the trust. When the trust terminates, the principal plus any excess income (over and above the annual payment to the Foundation) is transferred to the trust beneficiaries, typically your children or grandchildren.
A generous charitable gift tax deduction can be realized for the "present value" of the annual trust payments to the Community Foundation. This deduction can be used to reduce your gift and estate tax liability.
Although a gift tax may be due on the transfer of assets to your beneficiaries, the tax is based on the current market value of the assets, less the value of the Community Foundation's interest; the assets are subsequently removed from your estate.
One of the most attractive aspects of a lead trust is that the appreciation of the assets during the term of the trust is not subject to additional gift or estate taxation. As a result, it is sometimes possible to pass on to heirs a larger estate after taxes.
The Rolland L. Adams Society at the Lehigh Valley Community Foundation recognizes those who, through their gifts to the Foundation, have upheld Mr. Adams' tradition of giving for the future good of the community. As the publisher of the Bethlehem Globe-Times for many decades, Mr. Adams had a vision of a community endowment that would outlive him and the community leaders of the late 1960s.
Even three decades ago, Mr. Adams was a strong proponent of thoughtful estate planning that would keep resources in the community. Knowing that none of us alone can ever meet all the needs of the community around us, Mr. Adams sought to challenge each of us to do what we can with what we have. His well-known $250,000 challenge to the people of Bethlehem to raise funds for construction of the Bethlehem Public Library in 1965 elicited this kind of self-examination and yielded over $270,000 for the project in just 17 days. As one of his contemporaries said upon his death in 1979, Rolland Adams "caused many to step into a stride that is necessary to keep the community moving." The Lehigh Valley Community Foundation continues to benefit today from Rolland Adams' generosity. He remains one of the single largest donors in Foundation history, and his completely unrestricted bequest of $1,000,000 — drafted in 1967 — represented a five-fold increase in the assets of the Foundation at the time.
The Rolland L. Adams Society recognizes Mr. Adams and others who have helped the Foundation keep alive his vision of a community moving forward.
Society members gather annually at an event hosted by the Foundation, and they regularly receive information from the Foundation on matters pertaining to philanthropy and grantmaking.