FundSvcs Community

Good Evening, We are looking for best practices when a group of donors (nonrelated) decides to coordinate efforts to raise gifts for a specific named purpose that will require a gift agreement such as an endowment fund or expendable fund. An example of this would be raising funds to honor a deceased classmate or an advisory board that wants to pool their resources and create an endowment in the name of the advisory board. 1 - Do you do a different type of gift agreement than your standard endowment or expendable agreement? 2 - How do you determine who signs the agreement? 3 - After deciding who signs the agreement, then do you include language in the agreement that prevents that person from making changes in the future to the purpose for something they want and not the group? 4 - What happens if the group does not raise the minimum funding amount for a named scholarship? 5 - How long do you allow the fundraising to happen before you determine it is not feasible to fundraise anymore? 6 - Do you inform donors beforehand what the minimum amount is and how the funds will be used if the minimum amount is not met? Thank you. Colleen Colleen Hobson Senior Director of Advancement Services Utah State University Tel: 435-797-1285 Fax: 435-797-1364

Hi Colleen, We run into that situation quite often. Here are my responses: 1 - Do you do a different type of gift agreement than your standard endowment or expendable agreement? - Sometimes, it depends. Endowment GAs need to abide by UPMIFA laws so you'll want to consider having boilerplate language (e.g. Changed Conditions clause) that gives the university latitude to expend the funds to a similar designation should expenditure to the original designation become impossible or impracticable. Consult your legal counsel if you're unsure how to draft the language. 2 - How do you determine who signs the agreement? - Not sure if you mean internally or the donors. If you're referring to the donors, typically it's most prudent to have the least number of signers as possible. The more signers means the more approvals you may need to make changes, and the more change that one of the donors becomes lost or deceased. 3 - After deciding who signs the agreement, then do you include language in the agreement that prevents that person from making changes in the future to the purpose for something they want and not the group? - See my response in #1. Again, have your legal counsel account for this in the GA. Typically, you'll want language that either allows a selected individual to approve changes on behalf of the group or something akin to a "changed conditions" clause. 4 - What happens if the group does not raise the minimum funding amount for a named scholarship? - You should consider having boilerplate language in your endowment GAs that says if the minimum threshold isn't met by X years, that any accumulated funds will revert to an expendable account of similar purpose. 5 - How long do you allow the fundraising to happen before you determine it is not feasible to fundraise anymore? - Probably no more than 5 years, but that's really up to you. It should consider what is a reasonable amount of time and not something out of the ordinary for how you've accommodated previous donors. 6 - Do you inform donors beforehand what the minimum amount is and how the funds will be used if the minimum amount is not met? - YES, ABSOLUTELY! See response #4. They better know and I think you'll definitely want that clearly stated in your GA. -Eric Eric F. Valdescaro AVP, Advancement Services University of Hawaii Foundation From: Advancement Services Discussion List [mailto:FUNDSVCS@LISTSERV.FUNDSVCS.ORG] On Behalf Of Colleen Hobson Sent: Monday, April 15, 2019 2:28 PM To: FUNDSVCS@LISTSERV.FUNDSVCS.ORG Subject: [FUNDSVCS] Gifts being raised by multiple donors Good Evening, We are looking for best practices when a group of donors (nonrelated) decides to coordinate efforts to raise gifts for a specific named purpose that will require a gift agreement such as an endowment fund or expendable fund. An example of this would be raising funds to honor a deceased classmate or an advisory board that wants to pool their resources and create an endowment in the name of the advisory board. 1 - Do you do a different type of gift agreement than your standard endowment or expendable agreement? 2 - How do you determine who signs the agreement? 3 - After deciding who signs the agreement, then do you include language in the agreement that prevents that person from making changes in the future to the purpose for something they want and not the group? 4 - What happens if the group does not raise the minimum funding amount for a named scholarship? 5 - How long do you allow the fundraising to happen before you determine it is not feasible to fundraise anymore? 6 - Do you inform donors beforehand what the minimum amount is and how the funds will be used if the minimum amount is not met? Thank you. Colleen Colleen Hobson Senior Director of Advancement Services Utah State University Tel: 435-797-1285 Fax: 435-797-1364 This message (including any attachments) is covered by the Electronic Communications Privacy Act, 18 U.S.C. 2510-2521. It is the property of the University of Hawaii Foundation. It may contain confidential information intended for a specific individual and purpose. If you are not the intended recipient, you must delete this message. You are hereby notified that any disclosure, copying, or distribution of this message is prohibited.