DATE:
July 18, 2014
TO:
All Financial Information Users
FROM:
Gary Hunt
Treasurer
RE:
Endowment pool share payout (ESP) for Fiscal Year 2015
This letter is intended to provide budget planning guidance to the University community for
fiscal year 2015. This letter revises the version dated February 4, 2014 to reflect a change in the
fund raising fee.
The Endowment A Pool net spendable payout per share for fiscal year 2015, for all University and
Foundation endowments that are invested in the endowment pool, will be $3.29, a 14% decrease
from the current fiscal year net spendable payout of $3.83 per share. The decreased payout is
primarily the result of the reduction in the spending policy rate from 4.75% to 4.50% and the
exclusion of certain strategic assets (NDCL’s and real estate) owned by the endowment from the ESP
calculation. These changes were approved by the Board of Trustees on April 23, 2013.
Net 4.50% spendable payout per share
Fund raising fee
Gross payout per share
$3.29
1.28
$4.57
All endowments invested in the endowment pool should budget revenue in their expendable
endowment fund at a gross budgeted payout per share amount of $4.57. Individual endowment
funds that pay the fund raising fee should budget $1.28 per share as a transfer for fund raising fee
in their expendable endowment fund. Individual endowment funds that are ineligible to be
charged the fee should budget $1.28 per share as a transfer to endowment principal in their
expendable endowment fund.
Visit the UCFlex Financials System (SAP Transaction ZENDW_18) for endowment payout
projections and market values. For assistance utilizing the transaction, contact
(Dana.Ewing@uc.edu).
Please share this information widely with the appropriate people in your department.
Attachment
cc:
President’s Cabinet
Investment Committee
Endowment Operations Committee
Deans
College and Department Business Administrators
Attachment A
Endowment Spending Policy
Calculation of Fiscal Year 2015 Endowment Pool Payout
The endowment pool spending policy pays 4.5% of the 12-quarter trailing average market value
of an endowment pool share. The payout is distributed monthly.
“A” Share
Market Values
Fiscal Year 2013 Payout:
December, 2013
September, 2013
June, 2013
March, 2013
December, 2012
September, 2012
June, 2012
March, 2012
December, 2011
September, 2011
June, 2011
March, 2011
$ 77.5821
74.5514
73.1085
73.8884
72.3376
72.1421
70.7236
73.3434
69.4562
69.3767
75.7604
75.9554
12-Quarter Average Market Value per Share
$73.1855
Net Spendable Payout per Share = $73.1271 X 4.5%
Estimated Fund Raising Fee per Share = $73.1271 X 1.75%
(subject to approval)
Gross Payout per Share
$ 3.2933
$ 1.2807
$ 4.5740
Endowment Pool Payout History
$5.00
Payout Per Share
$4.00
$3.00
$2.00
$1.00
$0.00
2012
2013
Fiscal Year
2012 - 5.00% payout
2013 - 5.00% payout
2014 - 4.75% payout
2015 - 4.50% payout, strategic assets excluded
2014
2015