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Endowment Funds - Re-designation of Purpose

  • 1.  Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 02:57 PM

    Greetings, colleagues,

     

    We have an endowment for a program that no longer exists and are hoping to contact living donors to formally ask them to re-designate the purpose of the funds they contributed toward the endowment. We intend to ask them to sign a formal re-designation of endowment funds form/agreement.

     

    Has your organization ever done this?

    Do you have a template or process you can share about how you did this?

    Any other thoughts/advice?

     

    Thank you and Happy Holidays!

     

    Best wishes,

     

    Michele M. Wanner

    Associate Vice President

    University Advancement

    Chapman University

    One University Drive, Orange, CA 92866

    (714) 744-7623

    chapman.edu

     



  • 2.  RE: Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 03:17 PM
    Your attorney might have different thoughts from mine.  However, my attorneys have stated the following, and I have followed their lead without issue several dozen times over my career.

    The only required signature to change the purpose of a fund is the donor who initially created the fund.  In other words, the individual (or their representative) who signed the original agreement.  If you cannot locate a representative, then you will probably need to seek relief from your AG.

    You can send other donors who subsequently gave to the same endowment a letter indicating your plans.  That letter does not require a formal agreement or confirmation. Instead, it can offer them an easy opportunity to contact you or "opt-out" if they do not agree with those plans.

    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






  • 3.  RE: Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 03:36 PM

    Hello, John,

     

    Thank you for your note below.  There is no formal agreement signed by anyone when the endowment was established, rather a group of faculty/staff members who did a direct mail campaign seeking funds to establish this endowment and held events to raise funds for the endowment in honor of the former Athletic Training director.  These key faculty/staff members who launched this endowment are still at Chapman and are requesting the change of purpose. They are also donors to the endowment.

     

    I have copies of the original solicitation materials from this group to establish the endowment. Is it sufficient to have this faculty/staff group document in writing the change in purpose, and then notice the other donors via direct mail as you noted below, with the option to opt out?

     

    Thank you!

     

    Best wishes,

     

    Michele M. Wanner

    Associate Vice President

    University Advancement

    Chapman University

    One University Drive, Orange, CA 92866

    (714) 744-7623

    chapman.edu

     






  • 4.  RE: Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 03:58 PM
    I ran into the same concept at another university.  They called these "Internal Endowments."  It took me a few minutes to figure out they were talking about programs where faculty and departments could establish endowments without a standard endowment agreement.  In their case, the documentation consisted of a single 1-page memo.

    So, yes, I do think your approach makes a lot of sense, especially since the "founding members" all agree!  What might be a nice touch is to have a representative from this group be the letter writer/signer to emphasize that they are initiating the change.  But the approach you mention sounds like the right process!

    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






  • 5.  RE: Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 04:10 PM
    Hi All,

    I have been asked to find out of any instances of a pledge of a gift-in-kind that could be counted in a campaign.  
    There would be a promise to give it in writing, but it would not be deeded over until later.
    My first thought was that it could be structured as a kind of planned gift so that it could be credited during a campaign through those counting rules. 
    Of course, I am not the person in my office who works on planned gifts. 
    For my part, I have never booked a pledged gift-in-kind. It always had to be conveyed first.

    Any advice, thoughts or considerations? I am hoping there is a way to do this within CASE rules.

    Thanks!

     

    Lesley T. Pratt

    Assistant Vice President, Advancement Services

    Office of University Advancement

    Northeastern University

    Boston, MA 02120










  • 6.  RE: Endowment Funds - Re-designation of Purpose

    Posted 12-10-2019 04:11 PM
    Whoops- wrong category. I will re-post

    Regards,

     

    Lesley

     

    Lesley T. Pratt

    Assistant Vice President, Advancement Services

    Office of University Advancement

    Northeastern University

    716 Columbus Avenue, 402 CP

    Boston, MA 02120

    P (617) 373-6192 | C (617) 416-3489 | F (617) 373-5519 |le.pratt@northeastern.edu