I. Purpose of Policy
This is the Gift Fee Policy (“Policy”) of The University of Connecticut Foundation, Inc. (“Foundation”). The purpose of this Policy is to establish the gift acceptance fees (“Gift Fee”) that the Foundation will assess on charitable contributions received. The Gift Fees assessed by the Foundation will be used to support the Foundation’s mission including, without limitation, its administrative and fundraising costs.
The University has delegated primary responsibility for all University fundraising to the Foundation. The Foundation is committed to administering Non-endowed Funds (as defined herein) in compliance with all relevant Foundation by-laws, organizational concerns, industry standards, and federal and state laws and regulations including, without limitation, the Connecticut Uniform Prudent Management of Institutional Funds Act (the “Act”). No policy will supersede any provision of federal or state law or regulation.
In determining the Gift Fee charged on Non-endowed Funds, the Foundation will act in good faith, with the care that an ordinarily prudent person in a like position would exercise under similar circumstances and shall consider, as applicable and as required under the Act, the following factors:
- The purposes of the Foundation and the Non-endowed Funds;
- General economic conditions;
- The possible effect of inflation or deflation;
- The expected total return from income and the appreciation of investments;
- Other resources of the Foundation; and
- The investment policy of the Foundation.
The Foundation will in good faith make information concerning the Gift Fee available to donors and potential donors.
III. Fee Calculation Method
The Foundation has considered the prudence of assessing a Gift Fee on new gifts received by the Foundation, and has determined that Gift Fees will be assessed as follows:
- Five percent (5%) on gifts to Non-endowed Funds.
Twenty-five percent (25%) of any Gift Fee collected on a gift to a Non-endowed Fund will be transferred to unrestricted Foundation operating accounts supporting the school, college or unit responsible for the fund to which the gift was originally designated. If the school or college waives the twenty-five percent (25%) that portion of the gift fee will remain in the original gift account.
Any Gift Fee will be calculated as of the date of receipt by the Foundation and will be transferred to the Foundation’s appropriate operating funds as soon as practical. For assets requiring liquidation, including without limitation gifts of real estate, the Gift Fee will be calculated on the date of receipt and transferred to operating funds as soon as practical following liquidation.
IV. Exemptions from the Gift Fee
The Gift Fee will not be assessed on:
- Payments made pursuant to a Gift Instrument that by its terms does not permit the assessment of such fee;
- Payments made to University accounts;
- Payments made on documented pledges executed prior to February 1, 2009;
- Payments to support athletics for football seat donations only;
- Real estate or in-kind gifts if they are to be retained (not liquidated) for use by the Foundation;
- Gifts from large Private Foundations (as defined below) the governing board of which prohibits the assessment of such fee as an established organizational policy which can be documented in writing. (Note: Gift fees on any grant will not exceed the approved budgeted amount for indirect costs.)
- Non-deductible portion of a transaction (other than the priority seating portion of Athletic gifts);
- Principal payments to endowed accounts made on or after January 1, 2016;
- Gifts made directly to the spendable account of an endowment that is, at the time of the gift, more than 25% underwater;
- Gifts made pursuant to an exception to this policy as further described below.
In some cases, the gift fee realized on a non-endowed gift will be less than the approved gift fee percentage. No exception to this Policy is required in the following cases:
- Donor increases their donation to cover the cost of the gift fee;
- Gift fee is split between the Foundation and any University school, college, or unit and the gift agreement or budget does not allow the Foundation to realize 100% of the gift fee.
All exceptions to this Policy must be approved by the Finance Committee of the board of directors of the Foundation (the “Board”) upon the recommendation of the Foundation President where there is substantial potential for developing a long-term funding relationship with the donor and the gift’s designated use is compatible with the University’s organizational priorities. Exceptions to this Policy should be granted in only the rarest of circumstances.
Except as otherwise provided, this Policy applies to all gifts received, by the Foundation.
“Gift instrument” means a record or records, including a solicitation, under which property is granted to, transferred to or held by the Foundation or University.
“Non-endowed Fund” means a fund that is wholly expendable by the Foundation on a current basis under the terms of a gift instrument.
“Private Foundation” means a private philanthropic organization characterized by large staffs, a corporate management structure, large asset base, multiple branch offices, elaborate funding guidelines, the issuance of “requests for proposals,” broad-based philanthropic giving, and issue-focused philanthropic giving.
VII. Enforcement and Interpretation
It is the responsibility of all employees to uphold this Policy. Any violation of this Policy may result in disciplinary action up to, and including, termination of employment. Questions regarding interpretation of this Policy should be directed to the Foundation’s Vice President for Finance and Controls.
VIII. Effective Date
This Policy is effective retroactive to July 1, 2016 and replaces and supersedes any proceeding policy concerning this subject matter. This Policy shall be reviewed by the Finance Committee of the Board, which shall make any necessary recommendations with respect to amendments to this Policy to the Board of Directors.
Category: Finance and Administration
Applies to: All staff
Approved by: Board of Directors (Committee: Finance)
Effective Date: Approved October 7, 2016; retroactively effective July 1, 2016
Contact: Vice President of Finance and Administration
Official Website: www.foundation.uconn.edu/policies
Revision History: October 16, 2015; June 19, 2015; February 4, 2009