During economic downturns, charities and donors often inquire regarding a charity’s power to invade or borrow from its endowment. Charities may be interested in increasing endowment spending, seeking release of spending restrictions, making loans from an endowment, or pledging endowment assets as security for loans. Although it is true that endowments are typically established to support the related charity, myriad restrictions apply to their use, including restrictions created by donors and Boards, and those required under state law. Borrowing from an endowment or pledging endowment assets is subject to restriction and regulation as well—often to the surprise of charities and their Boards. READ MORE