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  • 1.  Gift fees on gifts covering gift fees

    Posted 09-14-2023 02:29 PM
    Our leadership is looking into changing our gift fee policy so that the gift fee is not charged on a gift made to cover the gift fee. 
    for example; if a person gives us $200,000 plus $10,000 to cover the gift fee, we need to acknowledge the donor gift of $210,000 but only charge a gift fee on the $200,000 and no gift fee on the $10,000.
    Currently, the gift fee is charged on all incoming gifts, even when donors give additionally to cover the gift fee.
    Does anyone have any guidance, tips, or warnings on this?
    Some thoughts already on my radar:
    • How is that equitable to all other donors?
    • Who makes the determination that a donor is making such a gift and not trying to avoid the gift fee?
    • How will these gifts be separated out for separate processing in our financial systems?
    • How will we communicate the difference to development and donors?
    I feel like I may be overcomplicating this, but it just seems like this proposed change will create an undue burden on our gift processing and accounting folks.
    Thanks,
    Amber


    AMBER R. GICHARD

    Director of Fund & Gift Services

    University of Alaska Foundation

    1815 Bragaw St., Suite 206, Anchorage, AK, 99508

    Voicemail: 907.786.1016

    Join us for Alaska: universityforalaska.com

    Make a gift online: engage.alaska.edu



    ------------------------------
    Amber Gichard
    University of Alaska Foundation
    argichard@alaska.edu
    ------------------------------


  • 2.  RE: Gift fees on gifts covering gift fees

    Posted 09-14-2023 02:44 PM
    Procedurally, I think you need to enter two separate gifts, even if there is a single check. You will want to create a unique transaction type to apply to the gift fee coverage amount so your automated systems knows to ignore that component.

    And, as the entire amount paid of $210,000 is tax deductible and countable, you do not need to differentiate between the amounts paid in fundraising totals.

    Donors must, however, either check a box or clearly state which portion of their payment will be used to cover the gift fee.

    I may not follow the equitability question, as this option is available to all donors. Unless, however, you are suggesting it is only available to some. In which case, I would rethink that stance and make it available!

    John


    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987




    Original Message


  • 3.  RE: Gift fees on gifts covering gift fees

    Posted 09-14-2023 02:59 PM
    Thanks John, 

    That's where my brain was going too on the processing end.
    Maybe I was overcomplicating it after all!

    Thanks,
    Amber


    AMBER R. GICHARD

    Director of Fund & Gift Services

    University of Alaska Foundation

    1815 Bragaw St., Suite 206, Anchorage, AK, 99508

    Voicemail: 907.786.1016

    Join us for Alaska: universityforalaska.com

    Make a gift online: engage.alaska.edu


    UA Employees: Please request fund balances, reports, lists, and receipts requests through the Foundation's Information Request Google Form. (You must be logged into your UA Google account.)






    Original Message


  • 4.  RE: Gift fees on gifts covering gift fees

    Posted 09-14-2023 03:04 PM
    I don't think you were overcomplicating this at all! Gift fees are complicated to begin with. When I was at NC State, we had to devise all sorts of "exception" rules that we had to figure out ways to automate. You are correct to question everything!

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987





    Original Message


  • 5.  RE: Gift fees on gifts covering gift fees

    Posted 09-27-2023 11:59 AM
    I missed this earlier, but does this boil down to a math problem? If your gift fee is 5%, and you're looking to net $200k, the math problem is what's the gross amount of donation that makes 95% of it be $200k? The formula is (200k x 100%) / 95% = $210,526.32 -- if the donor gifts $210,526.32, the net is $200k. Wouldn't it be easier to present donors with that number as the total gross-up to net $200k? Then you wouldn't have to make any exceptions in your process.

    The grand total of difference btw charging the fee on the fee or not is 0.25%, which really isn't going to make or break anything for the donor, so long as they know what number to put down. On the other hand, operationally supporting making this gift fee exception is a pretty substantial pain. 

    I guess another way of saying this is that not charging the gift fee on the extra gift is a complicated way to offer a very small discount on your gift fee, and how to get that discount is not really transparent to donors. 


    Thank you,
    Isaac Shalev
    Data Strategy Expert
    Sage70, Inc.
    (917) 859-0151
    isaac@sage70.com

    Schedule a 30-minute consultation now:




    Original Message


  • 6.  RE: Gift fees on gifts covering gift fees

    Posted 09-27-2023 02:17 PM

    I created a simple calculator for our staff to use to ensure they request the right amount.  

    Made a copy for you to see. 
    https://docs.google.com/spreadsheets/d/1unP7g-eUb5p1eSO5kt7TmqnITsq0utzUpmRvOl8sv4w/edit



    ------------------------------
    Jeff Baynham
    NC State University
    jtbaynha@ncsu.edu
    ------------------------------

    Original Message


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