How can I stop my Church from withdrawing money from the “principal” of our endowment?

With UPMIFA now the law in 46 states and introduced in two others, I wonder whether there really is "true endowment" anymore, in the restricted sense used in the answer. Absent VERY specific language in the gift instrument, the endowment board would have broad discretion to use income and principal for any proper purpose.

Unfortunately I think there is something to what you say, since trustees have wide latitude in determining what should be spend from "endowment." There is still some concept of fiduciary duty to the organization, however, and the need to retain some of the purchasing power of the gift. In fact, most large charities spend their "endowment" at a rate between 4.5% and 5%, thus retaining a significant portion as permanent endowment. In addition, FASB tells accountants that they should get boards operating under UPMIFA to say what portion of a gift is to be considered permanently restricted. Although that has no force of law, for the reasons I have previously expressed, I think it all ought to be considered permanently restricted under UPMIFA. (See Ready Reference Page: "Permanently Restricted Assets Should Be Considered Permanently Restricted Under UPMIFA.")