LANC Fund Endowment
North Carolina Bar Association Foundation Endowment
LANC Fund Policy Statement
The North Carolina Bar Association and its Foundation, in keeping with its longstanding support of the legal services community and specifically Legal Aid of North Carolina (LANC), is establishing the LANC Fund to help meet the civil legal needs of poor people in North Carolina. The new named fund within the NCBA Foundation Endowment will be restricted to support LANC.
At its January 18, 2007, the NCBA Foundation Board of Directors approved the establishment of the LANC Fund within its Endowment for the specific benefit of Legal Aid of North Carolina. In addition, at its January 18, 2007, the NCBA Board of Governors approved a charitable contribution option to benefit the LANC Fund on the 2007-08 NCBA member dues statement. The NCBA Foundation designates the NCBA to serve as its authorized agent for collection of contributions for the LANC Fund through the member invoice charitable option.
The establishment of the LANC Fund helps meet Momentum 2010 – The Profession – Goal # 2 Target # 2. which calls for the establishment of such a fund.
In keeping with the policies of the NCBA Foundation Endowment regarding restricted funds, the LANC Fund will be activated upon receipt of contributions totaling $100,000. The new named fund accepts contributions from North Carolina lawyers, law firms, legally affiliated groups and any other source wishing to help build and expand an endowed fund for LANC. The LANC Fund will develop a new revenue stream of endowed funds and would not compete in any way with the LANC Access to Justice Campaign. An information brochure entitled Two Ways to Give explains how the LANC Fund and Access to Justice Campaigns both support LANC efforts. Also, LANC and other legal services groups will still be eligible to receive NCBA Foundation Endowment grant monies from the unrestricted portion of the Foundation Endowment through the semi-annual grant process.
Since the North Carolina Bar Association Foundation is a public charity under Section 501(c) (3) of the Internal Revenue Code it may receive charitable contributions. It has designated the North Carolina Bar Association as its agent to collect charitable contributions on the Foundation's behalf. Such voluntary charitable contributions are tax deductible to the extent allowed by law. Membership and section dues are not deductible as charitable contributions for income tax purposes. Such dues may be deductible as a business expense. Each member should consult their tax advisor to determine appropriate tax treatment of payments in specific circumstances.
The NCBA Foundation Endowment will administer the LANC Fund for LANC at no administrative cost, similar to the services provided to donor-advised funds within community foundations, however, without the associated fees. In similar fashion, the LANC Fund will be an asset of the NCBA Foundation Endowment. The NCBA Investment Committee will invest the funds within its investment portfolio, while absorbing any fees, as part of the Endowment.
Contributions placed in the LANC Fund will be treated as true endowed funds, meaning that the corpus (the total of all contributions) will never be touched. In accordance with the NCBA Foundation Endowment’s five percent disbursement policy, an annual grant would be awarded to LANC to support its operating budget.
In the future, if warranted by size and/or circumstances, the LANC Fund could be invested and managed as a separate portfolio by our investment company within the overall NCBA/F portfolio. Investment management fees could be charged to the LANC Fund. If managed as a separate portfolio, the annual return of the LANC Fund would assume all risks and benefits.
The LANC Fund will allow all lawyers, law firms, legally-affiliated groups and the general public to help secure the long-term future of Legal Aid of North Carolina. As LANC expands its fundraising efforts, planned gifts, cy pres funds, class action residual funds could be contributed to the LANC Fund. Since the NCBA Foundation is a 501(c)(3) educational and charitable organization, all contributions to the LANC Fund are tax-deductible within the legal limits of the law.
The LANC Fund is intended to develop a new revenue stream of endowed funds and would not compete in any way with the LANC Access to Justice Campaign. Any promotional materials would distinguish this effort as endowment-building by the NCBA Foundation on behalf of LANC as distinct from the ongoing LANC annual fund. Also, LANC and other legal services groups will still be eligible to receive NCBA Foundation Endowment grant monies from the unrestricted portion of the Foundation Endowment through the semi-annual grant process.
Establishment of the LANC Fund continues a legacy of commitment dating back to 1976, at which time the NCBA established LANC. With its statewide structure now established, LANC is committed to increasing its capacity-building and fundraising activities. In support of these directives, it is appropriate for the NCBA and the NCBA Foundation to renew its commitment to LANC through the LANC Fund.
NCBA Foundation Endowment support of legal services includes hundreds of thousands of dollars in grants over the past 15 years, not to mention significant commitments of in-kind resources. The NCBA served as the official sponsor of LANC's 25th Anniversary and routinely hosts legal services groups at the N.C. Bar Center.