INTRODUCTION

The Permanent Endowment Fund of the First United Methodist Church of Van Alstyne, Texas is a duly organized Permanent Endowment Fund through the authority of the Charge Conference of The United Methodist Church and in accordance with The Book of Discipline, 200 8 of The United Methodist Church (paragraphs 2528.3, 2532.5, 2533) and as revised.

PURPOSE

The Permanent Endowment Fund of the First United Methodist Church of Van Alstyne, Texas (“Endowment Fund”) is established to provide members and friends the opportunity to make charitable gifts to the First United Methodist Church of Van Alstyne, Texas (“Church”) that will become a permanent endowment of financial support and a living memorial. The Endowment Fund is intended for realizing the Church's longer-term vision and purposes, which are not funded through the annual operating budget; however, gifts intended to supplement programs and ministries are appropriate.

Gifts may be designated for the following purposes through the corresponding sub-funds of the

Permanent Endowment Fund:

Undesignated: General Endowment Fund (for special needs and ministries identified and approved by the Administrative Council)

Designated: Sub-funds as (1) accepted under the gift acceptance policy for the Endowment Fund and/or (2) as identified and approved by the Administrative Council)

ADMINISTRATION

The Endowment Fund will be administered by the Permanent Endowment Fund Committee (“Committee”) at the direction of the Charge Conference. The Committee is accountable to the Administrative Council and ultimately to the Charge Conference. The membership of the Committee shall consist of nine voting members, three of whom are ex officio members, as follows: Chair of the Administrative Council; Chair of the Board of Trustees; Chair of the Finance Committee.

The six members-at-large shall be nominated as Elected Leaders by the Committee on Lay Leadership and elected for three-year terms at the Charge Conference. As member's three-year terms expire, members will be nominated and elected as provided herein. No member-at-large shall serve more than two consecutive three-year terms. The Senior Pastor shall not be a voting member of the Committee unless elected as an at-large member. Each year at its first meeting, the Committee shall elect two officers: Chairman and Secretary.

No person serving on the Committee shall profit personally, or through any business entity with which they may be involved, or from any transaction or investment made by the Endowment Fund. All questions of applicability of this paragraph should be submitted to the Committee for review.

DUTIES AND RESPONSIBILITIES OF THE COMMITTEE

The duties of the Committee include: 1) P roviding all services described in paragraph 2532.5 of The Book of Discipline, 2008 of the United Methodist Church and as revised; 2)Providing information and encouraging gifts to Endowment Fund; 3) Proper acknowledgment of gifts; 4) Keeping a record of donors and gifts; 5) Distributing grants and funds as approved by the Committee; 6) Incurring and paying ordinary and necessary expenses of managing the Endowment Fund; 7) Recording receipts and expenditures from the Endowment Fund; and 8) Maintaining a record of assets of the Endowment Fund.

INVESTMENT OF ENDOWMENT FUNDS

The Endowment Fund is required to place its funds in prudent investments. The Endowment Fund's investment objectives are: c onsistent annual income at a reasonable rate; e ffective maintenance of purchasing power through the growth of annual income and principal over and above that necessary to offset rises in the cost of living; and i nvestment of assets consistent with the goals outlined in the Social Principles of the United Methodist Church.

The Committee will determine an appropriate investment strategy for all the Endowment Fund's assets. The specific purpose of each sub-fund authorized by the Committee shall be stated in order to fulfill the wishes of the donor and thereby to segregate and maintain gifts for their stated purposes. Earnings from each sub-fund shall be available for distribution by the Committee in a manner consistent with the designated category. All gains and losses realized by the Endowment Fund must be applied against the Endowment Fund and not against any other assets of the Church. Each sub-fund of the Endowment Fund will share and be allocated, on a proportional (pro-rata) basis, the gains and losses realized from investing and managing the Endowment Fund, unless a gift was accepted on the basis of managing the investment individually.

In its investment policy, the Committee will be guided by the conservation of principle and making use of distributions determined by the Committee. The Committee will submit its investment policy to the Administrative Council annually for approval.

DISTRIBUTION OF INCOME AND PRINCIPAL

Distributions from all accounts (sub-funds) in the Endowment Fund shall be made with the majority approval of the full Committee. The amount of funds available for distribution each year shall be determined pursuant to a spending rate policy adopted by the Committee. This spending rate policy may be amended from time to time as deemed appropriate by the Committee. Any principal may be withdrawn only in extreme and overwhelming circumstances, bordering on the survival of the Church itself. Any such withdrawal of principal must be approved by a majority vote of the Charge Conference.

GIFTS TO THE ENDOWMENT FUND

Gifts to the Endowment Fund that are classified as designated will be assigned to the corresponding sub-fund.

For a gift to be designated for establishing a specific sub-fund, a minimum gift in the amount of $100,000.00 shall be required. The designation also must be in keeping with the Social Principles of the United Methodist Church. Gifts accepted into the Endowment Fund pursuant to gift instruments that either specifically require use of principal or impose further restrictions shall be accounted for and used in keeping with the terms of the respective gift instruments. A gift to the Endowment Fund that is not designated to a specific sub-fund will be placed in the General Endowment Fund.

The Committee shall have sole authority to accept or reject any and all gifts to the Endowment Fund in keeping with the authority granted by the Charge Conference. The Committee shall maintain a separate Gift Acceptance Policy.