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Endowment Agreement with no representative for signature?

  • 1.  Endowment Agreement with no representative for signature?

    Posted 11 days ago
    Hello FundSvcs Community,

    We recently had a donor leave a gift to our university with wording in his will to establish an endowed scholarship. 
    Since the donor is deceased and we did not know the gift was coming, we don't have anyone to sign an endowment agreement as a representative. 
    What process do you recommend in a situation such as this? Do you create the agreement and not have a representative signature, do you just establish a memo of creation to keep on file with the other documentation, or do you have a different option we haven't thought of yet?

    Thanks in advance for your help!
    -Chet

    ------------------------------
    Chet Kepler
    ckepler@pointloma.edu
    ------------------------------


  • 2.  RE: Endowment Agreement with no representative for signature?

    Posted 11 days ago
    Isn't there an Executor or legal agent assigned in the will?

    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 Agreement with no representative for signature?

    Posted 11 days ago
    We are just in the process of updating our Gift Acceptance Policy to clarify determining donor intent when the donor is deceased.

    In a case like this, we are currently proposing that if there's no gift instrument and no documented conversations with the donor, we would draw up a document of understanding that would be signed by the College, and would define that the fund would be used for general support, ie if an endowed scholarship, the endowed fund would support scholarships to those with a demonstrated financial need.






  • 4.  RE: Endowment Agreement with no representative for signature?

    Posted 11 days ago
    I like having a written policy that first places all unspecified bequests in a quasi-endowment.  Then, the ultimate responsibility on how to spend the money falls on the Board.

    John

    John H. Taylor 
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard





  • 5.  RE: Endowment Agreement with no representative for signature?

    Posted 11 days ago
    PS

    Back when I was at Duke, our policy (written and approved by the Board, had two components.  Undesignated bequests of under $10,000 automatically went to the Annual Fund.  All others went to this quasi-endowment.  By doing this, we eliminated internal arguments over who got to spend the gifts when they came in.  The Board decided.  A few years later, we amended the policy to provide further guidance to the Board, stating that withdrawals had to be used toward priorities outlined in the Strategic Plan.

    Ten years later, at NC State, we were frustrated by the frequency of undesignated bequests.  And we were more frustrated that MGOs wanted to count them in their - and campaign - totals when there was no evidence they had spent any time with the donor to document their intentions.  So, as we prepared to go into our campaign, we wrote a policy that read, in part:

    "MOUs outlining specific purposes for use of the bequest must be executed during the campaign period.  Other prior bequests will not be counted, although additions to those provisions made during the campaign will as long as they are supported by the above documentation."

    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







  • 6.  RE: Endowment Agreement with no representative for signature?

    Posted 11 days ago
    John,
    I'm curious how you handled bequests which named NC State University (rather than one of the Foundation).
    We have had several instances where Western Carolina University is named and NOT Western Carolina University Foundation.  
    The practice of our finance office has been to set up the funds within the WCU Endowment rather than the WCU Foundation endowment.  It makes for some difficulty in reporting and stewardship when we have the funds set up outside of the Foundation.  Additionally, in some of these instances we (advancement staff) have tried to work with donor reps on further clarification of the use of funds beyond just "scholarship" as noted in a will or trust agreement.  
    I'd love to hear thoughts from you or anyone else on how they manage the relationships between public institution and foundation.
    Thanks!
    Ben


    ------------------------------
    Benjamin Pendry
    Executive Director of Advancement Services
    Western Carolina University
    bjpendry@wcu.edu
    ------------------------------



  • 7.  RE: Endowment Agreement with no representative for signature?

    Posted 11 days ago
    Ben, I do not recall this ever being a problem - however, the team at NC State today may have other thoughts!

    Our success can be attributed in part to very good MOUs between the University and our various Foundations (we had something like eleven different foundations), combined with well-documented correspondence with donors addressing donor intention.

    If we ever had a related issue, it was when donors wrote checks payable to the University and not a Foundation.  However, we worked closely with the Foundation and our banks to address that problem without asking donors to send in a new check.

    If I recall properly, the only endowments we established within the University were intentional and pertained to professorships qualifying for the North Carolina State Matching Grant program.  By statute, if I recall, those had to be held by the University.

    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







  • 8.  RE: Endowment Agreement with no representative for signature?

    Posted 6 days ago
    Do you have a sample document you would be willing to share?

    ------------------------------
    Chet Kepler
    ckepler@pointloma.edu
    ------------------------------



  • 9.  RE: Endowment Agreement with no representative for signature?

    Posted 6 days ago

    Chet –

     

    At GT, we currently code them as unrestricted quasi-endowment.  We are trying to make these "out of the blue" estate gifts permanent unrestricted endowment, which at GT is controlled by the President, giving the Institute the maximum flexibility of the  use of those investment earnings going forward.

     

    IMHO, that is the best way to go with these gifts.

     

    Mark

     

    Mark Sanders

    Office of Development
    Phone (404) 894.8889 

    mark.sanders@gatech.edu

    image001.png@01D29C9C.8B849980