You can also see the Foundation's most recent Form 990-PF, Return of Private Foundation and Form 990-T, Exempt Organization Business Income Tax Return, for the year ending December 31, 2017. The 2016 Form 990-PF, 2016 Form 990-T, 2015 Form 990-PF and 2015 Form 990-T are also available. The 2018 Form 990-PF and 2018 Form 990-T will be available in December 2019.
Investment commentary for 2018
Investments and Audit
Global markets have been rising in recent years (though down at the end of 2018), creating better-than-expected returns for most foundations.
The Foundation's investment return in 2018 was 2.3%. The five- and ten-year investment returns were 7.0% and 8.5%, respectively. The Foundation's long-term investment objective is to generate a real return in excess of the IRS minimum 5.0% payout requirement. The Foundation has maintained more than sufficient investment liquidity to meet its operating needs.
The Foundation's investment program is coordinated by an Investment Committee of the board, a chief investment officer employed by the Foundation and an outside independent investment advisory firm.
KPMG LLP serves as the independent auditors for the Foundation. The Foundation's Finance and Audit Committee reviews the results of the audit examination and recommends to the board for approval. The Finance and Audit Committee also reviews the related federal tax filings.
Payout (Qualifying Distributions as defined by IRS)
The Foundation’s payout policy utilizes a multiyear smoothing formula that softens the impact of volatile markets in determining its annual payout targets. Targeted payout for 2019 is $46.1 million; actual payout for 2018 was $44.7 million. These payout totals exclude program-related investments, which can vary significantly from year to year. The Foundation’s long-term payout strategy is to continue to meet the required IRS minimum 5.0% payout over time.
Our aim is to be a highly dependable and effective partner for Minnesota, North Dakota and South Dakota and the 23 Native nations that share the geography. We expect that our investment and payout policies will provide the steady funding required by our program strategies in 2019 and beyond.