Saturday, January 3, 2009

In a tough economy, the Catholic Community Foundation stays the course

If you are fortunate enough to have surplus funds that you would like to invest in a foundation or a trust fund, perhaps you would like to contact the locally based Catholic Community Foundation in our Archdiocese of St Paul and Minneapolis.

chart.jpgParishes and organizations that have investments with the Catholic Community Foundation are concerned but not panicking about their funds’ falling stock market value.

“Like everyone else, we’re concerned about our investments,” said John Joslin, director of parish development and planned giving at Our Lady of Grace in Edina. But “CCF has excellent people. We’re very confident in what they are doing.”

About half of the 220 parishes in the Archdiocese of St. Paul and Minneapolis invest or endow funds through CCF, according to the organization. Founded in 1992, CCF creates endowments and invests funds to help sustain archdiocesan Catholic parishes, schools and other nonprofit organizations, such as Catholic Charities.

In an effort to educate its clients about its investment strategies and the economy, CCF hosted a presentation by Kathleen Taylor Dec. 11 at St. Therese in Deephaven.

Taylor is a senior vice president and principal at LCG Associates, Inc., an independent consulting firm that advises the Catholic Community Foundation. She was speaking to priests, business administrators and other parish, school and nonprofit organization leaders who have investments through CCF.

The decision to host Taylor was part of CCF’s commitment to open communication with its clients and not a response to investors’ requests, said Anne Rodenberg, CCF’s communications and marketing director.

“Given the economy, and given the markets, we thought it would be better to provide as much information as possible,” Rodenberg said.

‘Be bullish,’ despite bear

Don’t panic. Keep investing. And “be bullish” despite the bear market, Taylor told about 60 people who gathered for her presentation.

“With stocks down about 50 percent from a recent peak and bonds also suffering, no investor has been able to escape the downturn,” she said.

CCF’s investment pools are performing in line with benchmarks and peers, she said.

Dan Garry, parish administrator at Holy Name of Jesus in Wayzata, said he’s been concerned about the value of his parish’s CCF investments compared to those in the rest of the market. After listening to Taylor’s presentation, he expects them to be similar, he said.

The parish has a small endowment for its K-6 school and a fund to help the poor, he said.

The recession hasn’t dramatically affected how the parish invests its money yet, he noted. The parish still plans to invest funds received from a current fund campaign with CCF.

After providing an overview of the U.S. economic situation, Taylor gave advice for how to deal with the current bear market. A “bull market” refers to the market when securities or commodities are persistently rising; a “bear” market is when they are persistently declining.

Taylor encouraged them to keep their CCF investments. “By remaining in stocks, investors won’t miss out on significant growth opportunities over the long term,” she said. Although it’s tempting to cash out during a recession, it’s a bad idea, she added.
The presentation reinforced CCF’s belief that it is very difficult for anyone to time the market to their advantage, said Jim Mullin, CCF chief investment officer.

“Overall, the foundation is maintaining its long-term investment philosophy, as advised by LCG, and is taking care to monitor performance and rebalance funds to compensate for short-term fluctuations,” he said. “This philosophy has not changed given the current market conditions.”

Cheri Dixon, business administrator at St. Thomas Aquinas in St. Paul Park, said her parish plans to “hang tight,” with their investments. Its investments with CCF have decreased in value, “but considering the world, I thought [they were] pretty good,” she said.

The parish’s most recent report on its CCF investments’ value is from September, and Dixon expects the current financial quarter, which ended Dec. 31, to be worse, she said.

Optimism looking forward

Like many parishes, Lumen Christi in St. Paul had its eye on Christmas donations, said financial administrator Bill Elmquist.
“The largest contribution time is during the holiday season,” he said. “People are pretty dedicated to their parish, and we look forward to the continued support of our parishioners during this difficult economic time.”

Lumen Christi has several investments in CCF to protect the parish’s viability, he said. It has not had to dip into them, despite lower parishioner contributions than budgeted. The parish has changed its investment strategy with other accounts, but not with CCF, Elmquist said.

Neither has Our Lady of Grace, which still plans to add $3.5 million from its current campaign to an endowment for its K-8 school, Joslin said.

Holy Name of Jesus withdrew some of its more conservatively invested funds to help meet the increasing needs of the poor because of the recession, Garry said.

“I’m optimistic in looking forward,” he said, adding he thinks LCG offers a dynamic investment strategy which will bring better returns in the long run. The Catholic Spirit

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