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"Fee" on restricted giving

  • 1.  "Fee" on restricted giving

    Posted 9 days ago
    I recently came across a practice at a school that was new for me so I wanted to see if it's "a thing" or not.

    In the gift acceptance agreement of this school, there is a policy that states if a donor makes a gift to restricted giving, there is an "overhead rate against gifts with restrictions to reasonably allocate administrative and fundraising expenses to the restricted gift those expenses support".  However, in practice this overhead rate (fee?) gets split to unrestricted.  So if I make a $100 restricted gift, $95 goes to my restricted intention, but $5 is split out to unrestricted as kind of a servicing charge and the donor is receipted $100.

    I'm paraphrasing because I don't have a complete understanding of what the split to unrestricted is supposed to be doing, (beyond the obvious of bolstering your annual fund dollars and discouraging restricted giving?)

    But, is that a practice (common or otherwise) to assess an unrestricted split on a restricted gift?

    Thanks!
    Chris

    ------------------------------
    Christine Schwing
    Senior Business Consultant
    Jenzabar
    chris.schwing@jenzabar.com
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  • 2.  RE: "Fee" on restricted giving

    Posted 9 days ago
    What is a common practice is the establishment of gift assessment fees.  They are applied against many different gift categories in many different ways.  When I researched this (for the fifth time!) ten years ago when we established a fee at NC State, I interviewed 50 different programs and found 37 different fee structures!

    CASE has written a few pieces on this and I have been interviewed by several papers and publications over the years.  And CASE includes questions on this in their IRF survey.  So, yes, gift fees are common - but there's no "standard" practice.

    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