As I shared with you in 2020, the Trustees for the Diocese of Western Massachusetts is a corporation organized in 1902 to receive, manage and dispose of monies, funds and real estate not only of the Diocese, but also for those parishes that have entrusted funds to their care.
Their original gift of $100,000 from the sponsoring Diocese of Massachusetts formed the base which, with many additions, has today grown to a portfolio exceeding sixty-four million dollars. Today, the Diocese and the participating parishes each own approximately one half of the total assets of the Fund.
The Trustees’ investment policy states that “The assets of the Fund are to be invested in a manner that provides the safeguards and diversity that a prudent investor would adhere to. The general instruction is that the investment managers shall exercise such judgment as persons of prudence, discretion, and intelligent exercise in the management of their property and affairs, not in regard to speculation, but in regard to the management of their capital for long-time investment purposes, giving consideration both to the protection of current and future income and the need to preserve the purchasing power of the principal and income there from. This is known as the ‘prudent man rule’ (Harvard College vs. Amory, 9 Pick 446,461[1830]).”
The Fund (consisting of the original funds left to the Corporation as a fiduciary, and of deposits by individual churches, parish organizations and the Diocese itself), administered by the Trustees for the Diocese, provides an excellent vehicle for parishes to practice responsible stewardship while receiving maximum value and protection for the funds.
The Fund is particularly suited to manage the investments or endowments of local parishes. Such investments or endowments can be managed more efficiently and effectively in the aggregate than when fragmented in a variety of programs.
Participation in the Fund assures the individual parishes and the Diocese of a professionally-managed fund, continuity of management, annual audits, automatic permanent records for invested funds and income, a canonically legal investment vehicle and investment performance of historically proven results.
The Trustees is comprised of a maximum of twenty-five active members, three are nominated by the Bishop and the remaining members are nominated by the Trustees. Each election carries a five year term. Upon attaining the age of seventy-five years, members must relinquish active status but may continue to participate as an emeritus member.
The elected officers of the Corporation, along with six additional elected members, constitute a Board of Managers, who has full authority to manage the affairs of the Corporation. Members of the Finance, Community Investment and By-Laws Committees are elected at the Annual Meeting to serve for one year. Members of the other committees, including Nominating and Audit, are appointed annually by the President.
The Trustees employ an executive director, custodian, shareholder accountant, financial consultant and investment managers, who are guided by an Investment Policy Statement which defines investment objectives and targets. In 2022, the Fund’s expense ratio was under 1%.
The Fund is revalued on a quarterly basis; and distributions are made to fund shareholders using a spending policy of 5% annually, based upon a twenty quarter moving average of the Fund’s ending market value. Through 2022, the Fund’s annualized return was -10.9%, and its ten year annualized return was 6.7%
Because the quarterly distribution is calculated based upon the twenty quarterly Fund values of the previous five years, a dramatic rise or fall of the Fund does not seriously affect the quarterly distribution. This muting effect was witnessed most recently during 2022 when the Fund decreased in value by 13.0%, but the quarterly distributions increased by 2.6% for the year.
Participation in the Trustees Fund assures the individual parishes and the diocese of a professionally-managed fund, continuity of management, annual audits, automatic permanent records for invested funds and income, a canonically legal investment vehicle and investment performance of historically proven results. Please contact me any time with any questions regarding your Trustees-invested funds.
