The Long-Term Investment Pool (LTIP) is administered by Cornell University. The LTIP is similar to a mutual fund and includes both domestic and global investments; all securities are handled by outside managers. Funds invested in the LTIP include true endowments and funds functioning as endowments that are not expected to be spent for at least five years. The objective of long-term investment pooling is to produce reasonable returns coupled with capital appreciation. Like a mutual fund, participants buy shares at the current market rate and receive a per-share annual income payout as determined by the Cornell University Board of Trustees.
The two primary types of investment vehicles maintained in the LTIP are:
- True Endowments – gifts for which donors have stipulated that the principal never be spent. Only income generated from the investment of these funds may be used.
- Funds Functioning as Endowments (FFE) – funds that allow Weill Cornell Medicine departments to invest unrestricted operating funds in the LTIP. FFEs do not have a guaranteed rate of return; departments expose their investments to market losses as well as gains. All market risks associated with FFE investments are assumed by investing departments (to minimize risk, Cornell University and Weill Cornell Medicine have established FFE investment guidelines). FFE opportunities provide Weill Cornell Medicine departments with access to Cornell University’s LTIP income payout.
Minimum Investment Levels
The minimum amounts required for funds to be invested in the LTIP are set, according to investment purpose, by the Cornell University Board of Trustees. Minimum investment levels for Weill Cornell Medicine as of July 1, 2014 are as follows:
- Graduate School of Medical Sciences deanship: $5 million
- Interdisciplinary Program directorship: $3 million
- Full professorship: $3 million
- Assistant professorship: $2 million
- Clinical, investigative and educational endowment: $2 million
- Fellowship: $500,000
- Prize, book and journal funds: $100,000
- Scholarship and loan funds: $50,000
LTIP Payout
The payout for the LTIP is set annually by the Cornell University Board of Trustees, based on a payout policy adopted in 1998. LTIP payouts post monthly to individual SAP funds based on one-twelfth of the annual payout and an investment account's beginning-of-month permanent share position.
LTIP Rates
For the most current LTIP rate information, refer to the Cornell University Division of Financial Affairs. The Division of Financial Resources & Analysis distributes invested fund reports to Weill Cornell Medicine department administrators on a quarterly basis, providing information including book value, market value, estimated investment income and the number of permanent shares by investment.
Procedure for Establishing a True Endowment Fund
- All donor gifts to establish a true endowment are received by the Weill Cornell Medicine Office of External Affairs. External Affairs coordinates receipt of proper contractual agreements and donor payments to establish new true endowment funds.
- Contractual agreements and donor payment details are shared with the Division of Financial Resources & Analysis.
- Departments are notified of their fund number once their new true endowment fund is established.
FFE Procedures
Cornell University and Weill Cornell Medicine’s FFE policy currently states:
- The minimum investment threshold amount for an FFE is $100,000.
- Any requests for the establishment of a new FFE require the approval of the Weill Cornell Medicine CFO.
- Certain requests for the deposit of additional funds to an existing FFE may require approval of the Weill Cornell Medicine CFO; departments will be advised accordingly.
- The minimum investment threshold amount for an FFE must remain invested in the LTIP for a minimum of five years.
- All income earned from FFE investments is paid out monthly. A 10 percent surcharge is assessed by Weill Cornell Medicine on all income that is paid out to FFE funds.
- Any requests for withdrawal of funds from an FFE require a minimum two-month notice and approval from the Weill Cornell Medicine CFO.
- Any deviation from FFE policies requires approval from both the Weill Cornell Medicine and Cornell University CFOs.
- FFE policies are subject to change at the discretion of Cornell University and Weill Cornell Medicine.
To establish a new departmental FFE, add funds to an existing FFE or withdraw funds from an FFE, a memorandum should be sent to James Sisnett: jmsisnet@med.cornell.edu, providing the information outlined below; all necessary Cornell University and Weill Cornell Medicine approvals will be obtained by the Division of Financial Resources & Analysis.
To establish a new departmental FFE, using unrestricted operating funds, provide:
- The purpose of the new departmental FFE.
- A source of funding for the new departmental FFE:
- If a donor funds, provide one of the following:
- A copy of the donor letter stating that no restrictions preclude investment of the funds in the LTIP.
- A statement signed by both, the department chair or department administrator, and the Office of External Affairs, stating that the donor has not placed any investment restriction on the funds invested in the FFE.
- If Weill Cornell Medicine provides departmental surplus operating funds, provide a departmental fund transfer form signed by a department chair, noting the SAP fund number and title.
- Please note that professorships and scholar awards funded through FFE’s cannot be named for existing faculty members until they are retired.
- A completed, new SAP fund request form with appropriate authorized departmental signatures for the new FFE.
Once a new FFE is established, the department requesting the FFE will be notified of its SAP fund number.
To add funds to an existing FFE, provide:
- An SAP fund number for the FFE.
- A source of funding to be added to the existing FFE:
- If a donor funds, provide:
- A copy of the donor letter stating that no restrictions preclude investment of the funds in the LTIP.
- A statement signed by both the department chair or department administrator and the Office of External Affairs, stating that the donor has not placed any investment restriction on the funds being invested in the FFE.
- If Weill Cornell Medicine provides departmental surplus operating funds, provide a departmental fund transfer form signed by a department chair, noting the SAP fund number and title.
To withdraw funds from an FFE, provide:
- An SAP fund number for the FFE.
- The amount to withdraw from the FFE.
- A signed statement from a department chair noting the reason for the withdrawal.
Contact
For more information regarding invested funds, contact James Sisnett: jmsisnet@med.cornell.edu
