The Masonry Foundation Board
Trustee
THE FUTURE OF THE MASONRY FOUNDATION
By Mike Sutter
I have said many times and even written in this magazine in the past that the Masonry Foundation is the future of our Industry. It will allow us to fund organizations across the U.S. for initiatives such as workforce development, promotion, and building code and standards that can affect the masonry industry. We can be proactive instead of reactive when it comes to stopping code changes that are detrimental to us.
We are supporting apprenticeship programs and High School masonry programs to train and recruit these students into the masonry industry. We are educating structural engineers in the design of masonry structures. Without funds, we have either not been able to do these things or have had to reach out to industry supporters to provide funds.
As you are probably aware, and we are very proud of the fact that we were able to fund some grants from the Masonry Foundation for the very first time last year, but that is only the beginning of a very long process. So long, in fact, that it is never-ending as the corpus of our Foundation will live in perpetuity. Our initial goal was to raise $5 million in our corpus, and we are nearly there, with $4.3 million now pledged.
The funds in our account are conservatively invested, and the historical annual return for the investment model we have chosen is approximately 8%. This investment model is tested over 30 years to arrive at the expected annual return on our investments. However, our Investment Policy Statement (IPS) is Consumer Price Index (CPI) plus 4%. As of the end of January 2020, the CPI was 2.5% for the previous 12 months. So at the current rate, our goal is to receive a 6.5% return.
While last year we earned over 18% on our investments, we can’t expect a return like that in the future. We will continue to project CPI plus 4% return and realize that some years we will exceed that amount, and other years we may experience a negative return.
The Foundation Board of Directors has guidelines in place that will allow total funding of grants not to exceed 5% of our corpus. While we received a great return last year, we only agreed to fund our grants at 2% of our corpus as we have not yet reached our $5 million initial goals. With over $52,000 given in grants last year, that was a nice start but with much more to come in the future.
While our initial goal is $5 million, our long-term goal is $10 million, which is very achievable in the next few years, especially in the booming market we have been experiencing in the last few years. Let’s play with some numbers for a minute. With our initial goal of $5 million and funding our grants at 3% of the corpus, it will allow us to fund $150,000 in grants each year while still growing our corpus at 3.5% (at the current CPI rate) or another $175,000. Once we reach our long-term goal of $10 million, we will be able to fund $300,000 in grants while also continuing to grow our corpus $350,000 at current rates! Once we reach these goals, the Foundation Board will likely increase the grant funding as well.
While viewing these numbers, you can see how important it is to grow our corpus to reach our long-term goal of $10 million. We may never see a market better than the one we are currently in, so now is the time to invest in our future. We can reach our goal, but it will require the commitment of all of us. If you have completed your pledge, please consider renewing it. If you have not yet pledged, please help us reach our goal and pledge today as you see how important it is to reach our long-term goal. Together we are stronger, and together we can do this!