The Episcopal Diocese of Olympia announced on October 28 that it will transition the management of its $100 million investment fund into The Episcopal Church’s endowment, positioning the portfolio among the largest diocesan trusts under churchwide administration, as reported by Episcopal News Service.
Transitioning Western Washington Assets to Institutional Management
For decades, the Diocesan Investment Fund relied on volunteer oversight coordinated through the board’s Investments Committee. While that model guided the fund through years of market shifts, the increasing complexity of modern markets prompted church leadership to seek dedicated institutional expertise. By moving these assets into a new custodial trust account, the diocese joins a broader churchwide financial structure managed by the Domestic and Foreign Missionary Society (DFMS), the New York-based corporate entity of The Episcopal Church.
“For decades, our fund has been managed by volunteers overseen by the board’s Investments Committee,” the Diocese of Olympia’s board of directors said in a letter to shareholders. “While this has served us well in the past, the complexity of modern markets requires institutional expertise.”
According to figures provided by Episcopal Church Chief Financial Officer Christopher Lacovara to Episcopal News Service, the wider custodial trust program oversees $350 million across more than a dozen dioceses and over 150 congregations, operating alongside a separate $500 million church endowment. This scale allows participating bodies to access global managers and asset classes designed to diversify risk and support investment returns in times of market volatility—instruments typically reserved for much larger endowments.
Tying diocesan capital to ethical standards
Beyond portfolio diversification, the partnership directly ties diocesan capital to the denomination’s ethical standards. The transferred fund must comply with The Episcopal Church’s “no-buy” list while actively engaging in corporate social responsibility and impact investing programs dictated by General Convention resolutions. Church leaders emphasize that these mechanisms ensure financial returns do not contradict institutional values.
Performance metrics influenced the board’s decision. Sourced figures indicate that the DFMS Trust generated an average annual return of 8.3% net of fees since 1993. That historical yield outpaces the diocese’s internal benchmark evaluation, which showed an annual return of 7.8%.
The structural arrangement avoids punitive overhead charges. The Episcopal Church does not charge any management fees for custodial accounts, and investment fees are very competitive due to the scale of the DFMS Trust assets.
Retaining functional control over regional liquidity
Despite shifting day-to-day portfolio management to national leadership, local authorities retain functional control over liquidity. The Diocese of Olympia preserves the ability to manage deposits to and withdrawals from its Diocesan Investment Fund and holds the option to withdraw from the DFMS Trust in the future.
Diocese of Olympia’s investment fund joins Episcopal Church endowmenthttps://t.co/RXPcy1vuoO pic.twitter.com/2WH8dVPXWD
Bishop Phil LaBelle of Olympia framed the structural pivot as a direct boon to regional congregations operating across Western Washington.
“As faithful followers of Jesus in Western Washington, this change will help congregations better support mission-critical ministries throughout our diocese,” Olympia Bishop Phil LaBelle said in the release. “We are thrilled to partner with DFMS in this way.”
The integration reflects an ongoing initiative by The Episcopal Church Center’s Finance Office to assist local jurisdictions with long-term financial planning, real estate development, and portfolio oversight. Chief Financial Officer Chris Lacovara noted that supporting diocesan ministries through structured custodial programs remains a core operational priority for the national church office.
Frequently Asked Questions About the Olympia Endowment Move
Why did the Diocese of Olympia decide to transfer its investment fund now?
The diocese’s board of directors concluded that decades of volunteer oversight by the Investments Committee, while effective historically, could no longer match the complexity of modern markets.
How large is the fund being transferred into the churchwide system?
The Diocese of Olympia is transitioning a $100 million investment fund, making it one of the largest diocesan trusts under churchwide management.
What financial returns has the churchwide trust historically produced?
The DFMS Trust has generated an average annual return of 8.3% net of fees since 1993, outperforming the diocese’s own historical benchmark evaluation of 7.8%.
Will local leaders lose control over how money is withdrawn or deposited?
No. The diocese continues to manage deposits to and withdrawals from its Diocesan Investment Fund and maintains the option to withdraw from the DFMS Trust in the future.
