DAF Sponsor
Due Diligence Package
Program-Related Investment evaluation materials for DAF sponsors, advisors, and investment committee members.
One of your account holders has requested that their donor-advised fund make a Program-Related Investment (PRI) into the Civic Engine Guaranty Fund LLC, a Delaware limited liability company.
This package provides the information your investment committee needs to evaluate and approve this PRI. The Fund is designed specifically to be compatible with DAF-sourced PRIs and is designed to satisfy all four tests under IRC Section 4944(c), subject to confirmation by your tax counsel.
- Your account holder advises a PRI from their DAF into the Fund
- 100% of capital is invested in U.S. Treasury securities (~4.35% net annually)
- The Treasury portfolio backs construction loan guarantees for affordable housing in Kansas City
- Returns are retained and compound inside the Fund — growing guarantee capacity over time
- At fund termination (15 years + optional extensions), principal + all compounded returns return to the DAF
- No UBTI — Treasury interest excluded under IRC 512(b)(1)
The Fund is structured to satisfy all four IRC 4944(c) tests:
1. Charitable Purpose
Primary purpose is charitable — 1,600 affordable housing units, 8,000 tons CO₂ reduction, comprehensive wraparound services addressing eight cost burdens.
2. No Significant Income Purpose
~4.35% net return is well below market for comparable development risk (8–12%), confirming investment return is not a significant purpose.
3. No Lobbying Purpose
The Fund engages in zero lobbying activities. No portion of Fund capital is used for influencing legislation.
4. No Political Purpose
No political campaign activities of any kind. The Fund is exclusively focused on housing development and community impact.
We have prepared a detailed PRI Qualification Opinion (Document 1.9) for your legal team's review.
We have designed this fund to be the most straightforward PRI a DAF sponsor will ever review: 100% U.S. Treasury collateral, no active portfolio management, no equity risk to the underlying investments, and a clear charitable purpose that satisfies all four statutory tests. We welcome a direct conversation with your investment committee at any stage of your review.
(816) 529-7010
Supporting Materials
The following documents are available for your investment committee's review.
Fund Summary
| Fund | Civic Engine Guaranty Fund LLC (Delaware) |
| Manager | Civic Engine Fund Management LLC |
| Initial Fund Size | $30,000,000 (scalable to $200M) |
| Minimum Investment | $250,000 (DAF/Foundation PRI) · $1,000,000 (other accredited investors) |
| Collateral | 100% U.S. Treasury securities |
| Net Return | ~4.35% (retained, compounding; based on current Treasury rates) |
| PRI Eligible | Yes — all four IRC 4944(c) tests addressed (subject to tax counsel confirmation) |
| UBTI | None (IRC 512(b)(1)) |
| Fund Term | 15 years + two 2-year extensions |
| Effective Cost | ~0.15% (cost-recovery management fee; excess returned) |
| Carried Interest | None |
| Performance Fee | None |
| Leverage | 5.75:1 (development enabled per fund dollar) |
What Your Donor's Capital Enables
two KC districts
30–80% AMI
avoided annually
savings for families
savings
ratio
over 40 years through
capital recycling
Compatible DAF Structures
The Fund is structured to accept PRIs from a broad range of donor-advised fund platforms.
- Impact-focused sponsors (ImpactAssets)
- National sponsors (Fidelity Charitable, Schwab Charitable)
- Community foundations (Greater Kansas City Community Foundation)
- Custom PRI programs
If your platform does not currently offer PRI options, we can provide additional materials to support an approval process.