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3147967984
Total Assets
265841451
Total Grants
5079
Grantees

Chart for the Consolidated Statements of Financial Position

Consolidated Statements of Activities Table

Consolidated Statements of Cash Flows Table

Notes to Consolidated Financial Statements


December 31, 2020 and 2019

(1) Organization

The New York Community Trust and Community Funds, Inc. (including its Long Island and Westchester divisions) (The Trust) are community foundations created to build permanent charitable endowments for the greater metropolitan region. The Trust, as the consolidated foundations are hereinafter referred to, is tax-exempt under Section 501(c)(3) of the Internal Revenue Code (the Code) and has been determined not to be a private foundation under Section 509(a)(1) of the Code. The Trust administers more than 2,000 individual charitable funds, each established with an instrument of gift describing either the general or specific purposes for which grants are to be made, from a spending plan distribution, income, and in some cases from principal.

(2) Summary of Significant Accounting Policies

Accounting standards provide that if the governing body of an organization has the ability to remove a donor restriction, the contributions should be classified as net assets without donor restrictions. However, under New York State law and The Trust’s governing instruments, the assets are held as endowment funds until such time (if ever) as the governing body deems it prudent and appropriate to expend some part of the principal or appreciation. Accordingly, the consolidated financial statements classify all net assets as without donor restrictions.

Cash equivalents represent short-term investments with original maturities of 90 days or less, except for those short-term investments managed as part of long-term investment strategies.

Fixed assets are recorded at cost and are depreciated on a straight-line basis over the estimated life of the respective asset. Leasehold improvements are depreciated over the life of the respective improvement or the remaining term of the lease, whichever is shorter. Fixed assets are reported net of accumulated depreciation of $920,578 in 2020 and $796,600 in 2019.

Grants and services to beneficiaries (Grantmaking) are primarily unconditional and usually paid within one year. Unconditional grants are expensed with approval of the Distribution Committee of The New York Community Trust (NYCT) or the Board of Directors of Community Funds, Inc. (CFI). Conditional grants are recognized as expense after all barriers have been met by the beneficiary.

The Trust has adopted a constant growth spending plan for many of its funds. This approach allows spending to increase at a steady rate within the confines of a floor, a ceiling, and a cap. The spending plan is not applied to funds in CFI that are considered to be underwater, as defined by New York State law. At December 31, 2020 and 2019, no fund was considered to be underwater.

Accounting estimates are an integral part of the consolidated financial statements prepared by management and are based upon management’s current judgments. Actual results could differ from those estimates.

Certain amounts in 2019 have been reclassified to conform with the 2020 presentation.

In 2019, The Trust adopted Accounting Standards Update (ASU) No. 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made, with respect to contributions received. The adoption of this portion of the ASU did not have a significant impact on The Trust’s consolidated financial statements. The portion of this ASU related to contributions made was adopted by The Trust in 2020, which also had no significant impact on The Trust’s consolidated financial statements.

(3) Liquidity and Availability of Financial Assets

Resources available to The Trust to fund general expenditures, such as operating expenses and grants, have seasonal variations related to the timing of spending plan distributions and receipt of gifts. The Trust actively manages its resources, utilizing a combination of short, medium, and long-term operating investment strategies to align its cash inflows with anticipated outflows. Furthermore, there are likely to be additional components of The Trust’s investments that may be available and liquid within one year. These components include certain portions of marketable alternatives, as well as return of capital from private equity. At December 31, 2020 and 2019, financial assets available within one year to fund general expenditures were as follows:

Note to the Consolidated Financial Statements

(4) Investments and Fair Value Measurements

Fair value is defined as the exchange price that would be received to sell an asset, or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy requires The Trust to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are:

• Level 1 inputs are quoted or published prices in active markets for identical assets or liabilities.

• Level 2 inputs are inputs other than prices included within Level 1 that are observable for the asset, such as quoted prices for similar assets or liabilities.

• Level 3 inputs are unobservable inputs for the asset or liability.

ASC 820, Fair Value Measurement, allows The Trust, as a practical expedient, to estimate the fair value using net asset value (NAV) for commingled investments that do not have a readily determinable fair value.

ASC 820, Fair Value Measurement, allows The Trust, as a practical expedient, to estimate the fair value using net asset value (NAV) for commingled investments that do not have a readily determinable fair value. Most of The Trust’s investments are in publicly traded securities or in commingled funds that invest in publicly traded securities. Fair value for these investments is based on quoted market prices or published prices. The Trust also invests in hedge funds and private equity investments, including private real estate investments. The fair value of these investments has been determined primarily through the net asset values provided by the fund managers utilizing quoted market prices for underlying securities, market values for comparable companies, an income-based approach, or discounted cash flow projections. The Trust received a gift of interest in a limited liability company (LLC), which is carried at fair value based on The Trust’s interest in the net assets of the LLC. The valuation is reviewed for reasonableness by management of The Trust. The Trust invests for long-term growth in real terms, consistent with a reasonable degree of risk. Donor advised funds that require a high degree of liquidity are invested in cash equivalents. The investments of NYCT are held in individual trusts at the bank designated by the donor in the instrument of gift. The following tables present The Trust’s investments at December 31, 2020 and 2019, respectively:

The Trusts Investments table

The Trusts Investments 2019

The Trust’s investments valued at NAV include:

Hedge Funds – Consist mainly of multi-strategy funds that attempt to generate consistent positive returns by focusing on opportunities that are not correlated with the overall markets. This category also includes two funds that seek to achieve equity-like returns with lower volatility than the equity markets. These funds may be redeemed at net asset value at least annually and in most cases more frequently. Advance notice of 30-90 days is required to redeem these investments.

Private Equity – These funds focus on buyouts – primarily of midcap companies. Certain funds of funds also have a small allocation to venture capital. As the underlying investments are liquidated, assets are distributed. Funds are expected to be fully liquidated over the next 10 years. Certain of The Trust’s investments in private equity involve future cash commitments, which amounted to approximately $54 million at December 31, 2020.

The following table presents a reconciliation for all Level 3 assets measured at fair value for the period from January 1 to December 31:

Level 3 Assets Table

(5) Functional Expenses

Salaries and benefits, occupancy, and office expenses are attributable to grantmaking, administrative, or development functions, and are allocated consistently based on estimates of time and effort. The following tables illustrate the functional expenses for the years ended December 31, 2020 and 2019, respectively:

Functional Expenses Chart

(6) Commitments

On March 30, 2004, The Trust entered into a lease agreement for office space expired March 31, 2020. In June 2017, The Trust signed the Amendment of Lease to extend the lease term through August 31, 2030. Future minimum annual rental payments are approximately $2.0 million in 2021 to 2025, and a total of $10.0 million thereafter through 2030.

Rental expense is recognized on a straight-line basis, in accordance with ASC 840, Accounting for Leases. The excess of recognized expense over actual rent payments as well as landlord-provided improvements has been recorded as deferred rent credits. Rent expense for the years ended December 31, 2020 and 2019 amounted to $1,117,407 and $1,362,862, respectively.

(7) Pension and Postretirement Medical Benefit Plans

The Trust administers a noncontributory defined benefit pension plan covering substantially all employees. Benefits are based on years of service and the employee’s compensation during the five highest consecutive years during the last ten years of employment. The Trust also provides medical insurance benefits for its eligible retired employees. Obligations and funded status at December 31 are as follows:

Pension Benefits and Postretirement Medical Benefits

The accumulated amounts not yet recognized as a component of net periodic benefit cost were $2,915,243 and $(394,162) at December 31, 2019 for the pension and postretirement medical plans, respectively. The estimated amounts that will be amortized into net periodic benefit cost in 2020 are $53,000 and $(5,000), respectively.

Pension Benefits and Postretirement medical benefits

The healthcare cost trend rate assumption for 2021 is 5.10%, decreasing to 4.80% in 2026.

The pension plan is invested in a balanced portfolio of equity and fixed income securities. Annual projected benefit payments for the pension and postretirement medical benefit plans are expected to average $1,826,000 and $115,000, respectively, through 2030.

The following tables present The Trust’s fair value hierarchy for the investments of its defined benefit pension plan as of December 31, 2020 and 2019, respectively:

The Trusts Fair Value Chart

The Trust also sponsors a defined contribution retirement plan in which contributions are based upon a specified percentage of salaries and years of service. The expense for this retirement plan was $753,987 in 2020 and $704,618 in 2019.

(8) Subsequent Events

The Trust evaluated its December 31, 2020 consolidated financial statements for subsequent events through April 21, 2021, the date the consolidated financial statements were available to be issued. The Trust is not aware of any subsequent events that would require recognition or disclosure in the consolidated financial statements.

Independent Auditor's Report

Distribution Committee of The New York Community Trust and Board of Directors of Community Funds, Inc.:

We have audited the accompanying consolidated financial statements of The New York Community Trust and Community Funds, Inc. (including its Long Island and Westchester divisions) (collectively, The Trust), which comprise the consolidated statements of financial position as of December 31, 2020 and 2019, and the related consolidated statements of activities and cash flows for the years then ended, and the related consolidated notes to the consolidated financial statements.

Management’s Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with U.S. generally accepted accounting principles; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly in all material respects, the financial position of The New York Community Trust and Community Funds, Inc. (including its Long Island and Westchester divisions) as of December 31, 2020 and 2019, and the changes in their net assets and their cash flows for the years then ended in accordance with U.S. generally accepted accounting principles.

KPMG

April 21, 2021

2020 Financial Highlights

Total Assets Graph

INVESTMENT COMMITTEE MEMBERS

Kevin R. Byrne, Committee Chairman Chief Executive Officer Pacific Global Asset Management

Elizabeth B. Dater, Retired Managing Director Angelo, Gordon & Co.

Patricia Haverland, Retired Vice President & Chief Investment Officer Siemens North America Pensions

Rosemarie Liu Shomstein, Retired Senior Vice President & Deputy Chief Investment Officer AXA Equitable Life Insurance Company

Lorie A. Slutsky, President, The New York Community Trust

Financial information about The New York Community Trust can be obtained by contacting us at: 909 Third Avenue, 22nd Floor, New York, New York 10022, (212) 686-0010, at www. nycommunitytrust.org, or as stated below: Florida: SC No. CH9514 A COPY OF THE OFFICIAL REGISTRATION AND FINANCIAL INFORMATION MAY BE OBTAINED FROM THE DIVISION OF CONSUMER SERVICES BY CALLING TOLL-FREE, WITHIN THE STATE, 1-800-HELP-FLA OR AT www.FloridaConsumerHelp.com REGISTRATION DOES NOT IMPLY ENDORSEMENT, APPROVAL, OR RECOMMENDATION BY THE STATE. Maryland: For the cost of postage and copying, from the Secretary of State. Michigan: MICS No. 22265. Mississippi: The official registration and financial information of The New York Community Trust may be obtained from the Mississippi Secretary of State’s office by calling 1-888-236-6167. New Jersey: INFORMATION FILED WITH THE ATTORNEY GENERAL CONCERNING THIS CHARITABLE SOLICITATION AND THE PERCENTAGE OF CONTRIBUTIONS RECEIVED BY THE CHARITY DURING THE LAST REPORTING PERIOD THAT WERE DEDICATED TO THE CHARITABLE PURPOSE MAY BE OBTAINED FROM THE ATTORNEY GENERAL OF THE STATE OF NEW JERSEY BY CALLING (973) 504-6215 AND IS AVAILABLE ON THE INTERNET AT http://www.state.nj.us/lps/ca/charfrm/htm. New York: A copy of our most recent financial report is available from the Charities Registry on the New York State Attorney General’s website at www.charitiesnys.com or, upon request, by contacting the NYS Attorney General, Charities Bureau, at 120 Broadway, New York, NY 10271 or at 212-416-8401. North Carolina: Financial information about this organization and a copy of its license are available from the State Solicitation Licensing Branch at (888) 830-4989 (within N.C.) or (919) 814-5400 (outside N.C.). Pennsylvania: The official registration and financial information of The New York Community Trust may be obtained from the Pennsylvania Department of State by calling toll-free, within Pennsylvania, 1-800-732-0999. Virginia: From the State Office of Consumer Affairs in the Department of Agriculture and Consumer Affairs, P.O. Box 1163, Richmond, VA 23218. Washington: From the Charities Program at 1-800-332-4483, or www.sos.wa.gov/charities. West Virginia: West Virginia residents may obtain a summary of the registration and financial documents from the Secretary of State, State Capitol, Charleston, WV 25305. Wisconsin: A financial statement of the organization disclosing assets, liabilities, fund balances, revenue and expenses for the preceding fiscal year will be provided to any person upon request. CONTRIBUTIONS ARE DEDUCTIBLE FOR FEDERAL INCOME TAX PURPOSES IN ACCORDANCE WITH APPLICABLE LAW. REGISTRATION IN A STATE DOES NOT IMPLY ENDORSEMENT, APPROVAL, OR RECOMMENDATION OF THE NEW YORK COMMUNITY TRUST BY THE STATE.