This series issue presents a description and assessment of the Agency for International Development (AID) funded endowment concept as conducted by a number of AID Missions and host governments in Latin American and the Caribbean. These endowments are being used to strengthen and sustain the financial base of existing or new non-governmental institutions, including foundations and educational institutions; or to help in transferring important development functions that are poorly performed by the public sector. Topics discussed include: the creation, funding, expansion, and management of endowments; their dissolution; and issues of concern that could hinder host governments and donors from establishing a successful endowment. These issues include institutional displacement, organizational performance, political interference, and the rapid devaluation of an endowment due to such things as currency instability, rampant inflation, and government policies. Also discussed are issues concerning financial accountability in order to protect endowment resources, and the point at which AID responsibility for monitoring and exercising control over the management and use of endowment earnings ends. Names and descriptions of eight AID-funded endowments in Costa Rica, Ecuador, Honduras, the Dominican Republic, and Portugal conclude the report. (GLR)