The LASA Endowment Fund was established in 1983 with an initial grant of $14,000 from The Ford Foundation. In 1999 the Ford Foundation provided an additional grant of $2 million for the Endowment. Member and friend contributions to the Fund, as well as transfers from the Reserve Fund of $200,000 in 1999 and $300,000 in 2001, and accrued interest, resulted in a value of $3.1 million by the end of 2001. During the following two years the Fund lost considerable value, despite the efforts of the LASA Investment Committee; however, due to favorable economic conditions, by December 2007 the value of the Endowment was 4.2 million. More recently the Fund felt the effects of the general economic decline and lost approximately 35 percent of its value. However, this trend has now been reversed, and in the most recent quarterly report, the Endowment Fund stands at $5.2 million.
Purposes of the Endowment
The Endowment Fund has two main purposes:
- To institutionalize the participation of Latin Americans in LASA International Congresses: Significant participation by scholars and practitioners from Latin America and the Caribbean in LASA meetings is critical to the success of these international encounters. Income from a strong Endowment allows the Association to expand the level of participation of these individuals in International Congresses and related activities of the Association.
- To guarantee funding for special projects (LASA-FORD Special Projects) that involves trans regional collaboration: Collaborative research, working groups, and mini conferences will allow small groups of LASA members to work closely with one another in "state of the art" activities. Such projects, based on competitions overseen by the Executive Council, permit activity that otherwise are unlikely to be funded. They will bring LASA members together in new, productive ways and encourage new thinking.
Payout Rate on Endowment
LASA's goal is to maintain or increase the value of the Endowment principal in real terms. Accordingly, LASA will normally draw no more than five percent per annum of the Endowment balance. A payout larger than five percent per annum will require a majority vote of the Ways and Means Committee, which will seek the advice of the Investment Advisory Committee before reaching a final decision. The actual amount of the annual payout will be calculated as a percentage of the average market value of the portfolio for the preceding two years. The purpose of using a two-year period rather than a shorter period is to even out swings in the value of the portfolio up or down. The Investment Advisory Committee and the Ways and Means Committee will review on a regular basis the payout rate in light of portfolio performance. LASA is not expected to revise the five-percent payout policy based on short-term swings in the portfolio, but a sustained decline for a year or more would probably require an adjustment in the payout policy. The Association will draw from the Endowment Fund between quarterly and once every eighteen months, as required.