Gift Acceptance Policy
SOUTHERN ARKANSAS UNIVERSITY FOUNDATION
Gift Acceptance Policy
Approved by the SAUF Board of Governors
February 29, 2008
I. OVERVIEW
A. GENERAL
The Southern Arkansas University Foundation (SAUF) offers donors the opportunity to make gifts of both cash and non-cash assets.
SAUF also offers donors opportunities to make gifts reserving a life income for the donor and other beneficiaries through their wills or through current giving.
B. SAUF AND THE ETHICS OF GIVING
SAUF accepts gifts only when there has been a full disclosure, to best of SAUF’s ability, between the donor and SAUF and when all of the tax ramifications of the gift have been discussed between SAUF, the donor, and the donor’s advisors.
SAUF encourages all donors, before accepting a gift, to seek counsel on legal and tax matters,
SAUF accepts only those gifts which are in the best interests of all of the parties.
C. DEFINITIONS
(1) Gift or donation: A gift or donation is cash or property, other than real property, received for the purpose of a program for the public good, scholarship funds, equipment for research, and for other educational purposes, without expectation of specific benefit to the donor. Examples of specific benefit to a donor would be use of the funds to perform research which is to be reported to or to become the property of the donor, or to test for the donor’s purposes equipment or a product provided by the donor.
(3) Endowment: An endowment is cash or property (including real property) received from an external donor creating a fund in which the principal of the fund is not expendable. The earnings from the investment may be expended.
(4) Restricted Gift or Endowment: A restricted gift or endowment is an endowment, scholarship, or other gift, donation, or grant of money or property of any kind, other than real property award, the use of which is subject to conditions or restrictions imposed, requested, or provided; e.g., a condition or restriction which relates to what kind of teacher or student may benefit from a gift or the subject matter which may be taught.
D. CONFIDENTIALITY
Information concerning prospective donors is confidential. SAUF releases information to the university community and the general public only in accordance with the donor’s instructions.
E. THE VALUATION OF GIFTS
Gifts will be valued by the application of generally-accepted accounting principles. The donor is responsible for documentation the value of the gift, which in some circumstances may require appraisals in a form satisfactory to the Internal Revenue Service before SAUF may accept the gift. Donors are expected to provide SAUF with copies of all appraisal materials.
F. MATERIAL RESTRICTIONS
SAUF may not accept gifts that place restrictions on the use of the gift in contravention of the law.
G. GIFTS REQUIRING SAUF BOARD APPROVAL
1. Gifts that are consistent with the purposes of SAUF and otherwise comply with the law do not require SAUF Board approval for acceptance.
2. Some gifts, because of the nature of the gift, the law, or special circumstances, require SAUF Board approval. These gifts include, but are not limited to:
Real Estate
Bargain Sales
Assets with unusual liabilities attached
II. ASSETS ACCEPTABLE AS GIFTS
The following assets are acceptable as described, either as outright gifts, as bequests or devises (estate gifts), or when appropriate, as funding for a charitable remainder trust, gift annuity, or lead trust as determined by the IRC. All gifts are subject to approval by ARCF staff and outside legal counsel. ARCF may decline a gift for any reason.
A. CASH
SAUF accepts cash, check, money orders, bank drafts and gifts via credit card and internet payment mechanisms.
B. MARKETABLE SECURITIES
SAUF accepts gifts of publicly traded stocks and bonds.
C. SECURITIES IN CLOSELY HELD CORPORATIONS
SAUF accepts stock in closely-held corporations, subject to a qualified financial and legal appraisal.
D. S-CORPORATION STOCK
SAUF accepts stock in so-called “S-corporations,” subject to a qualified financial and legal appraisal.
E. PARTNERSHIP INTERESTS AND INTERESTS IN LIMITED LIABILITY COMPANIES (“LLC”)
SAUF accepts stock in partnerships and limited liability corporations, subject to a qualified financial and legal appraisal.
F. FAMILY LIMITED PARTNERSHIPS (“FLP”)
SAUF accepts stock in family limited partnerships, subject to a qualified financial and legal appraisal
G. REAL ESTATE
Real estate gifts must be approved by the SAUF Board of Directors and legal counsel. Depending on the facts, the gifts may be accepted with conditions imposed by SAUF which will remain the responsibility of the donor. Donors remain responsible to environmental regulations to the extent required by the law.
H. BARGAIN SALES
The SAUF Board of Directors may approve gifts in the form of bargain sales. (A bargain sale is one in which SAUF is provided the opportunity to purchase property at less than its fair market value. The gift is usually the difference between the sale price and the market value. ).
I TANGIBLE PERSONAL PROPERTY
SAUF may, in its discretion, accept gifts of tangible personal property. Conditions for accepting such gifts include: salability or usability and current needs for the type of property offered; physical condition of the property; cost of any storage or insurance needed and any other unusual feature or condition involved in the transfer.
J. INSURANCE
SAUF may be named as a percentage or contingent beneficiary of any life insurance policy. In addition, SAUF accepts life insurance policies for which the donor has relinquished ownership by assigning all rights, title, and interest in the policy to SAUF. If the insurance policy is not fully paid up, then the usefulness of the gift is judged on a case-by-case basis. If the policy is accepted, then SAUF may choose either to cash it in for the current surrender value or continue to pay the premium still due. SAUF does not participate in charitable split dollar insurance plans.
K. RETIREMENT PLAN ASSETS
SAUF may be named as a beneficiary of any retirement plan.
L. BEQUESTS
SAUF receives bequests from persons who have directed in their wills that certain assets be transferred to the Foundation. The Foundation’s legal name is Southern Arkansas University Foundation.
M. OTHER ASSETS AND FORMS GIFT MAY TAKE
Other types of gifts not mentioned in this policy may be acceptable within reason for the purpose given, and in an amount appropriate for the gift type. SAUF rely on fiscal and legally-sound rationales for the acceptance of such gifts. The SAUF Board may be required to approve such gifts. .
IV. LIFE INCOME ARRANGEMENTS
The following life income agreements are acceptable when in compliance with the Internal Revenue Code at the time the gift is established, and are subject to reformation as tax laws change. SAUF willingly acts as trustee for these life income vehicles where SAUF is the irrevocable remainder beneficiary.
A. GIFT ANNUITIES
A gift annuity contract may be established for a minimum gift of $10,000. Additions to an annuity are not permitted. Annuitants must be sixty years of age or older when payments begin. Annuities may have no more than two annuitants and no exception shall be made. A gift annuity agreement shall not be issued unless the charitable gift computed using the government tables exceeds 10% of the amount transferred for the annuity. The payout rates offered are regulated by Arkansas statutes and shall be those recommended by the American Council on Gift Annuities.
B. CHARITABLE REMAINDER TRUSTS
SAUF may accept gifts from both charitable remainder annuity trusts and charitable remainder unitrusts which are in a form substantially similar to the forms approved by the Treasury Department or are otherwise determined by SAUF’s legal counsel to be legal trusts for administration by SAUF. SAUF encourages the use of a Trustee suitable to the donor including banks or other appropriate institutions. If SAUF be selected to serve as Trustee, then SAUF will provide donor’s advisors with certain necessary Trustee provisions. SAUF will consider serving as Trustee only on the following terms:
1. SAUF is the irrevocable remainder beneficiary.
2. The trust is funded with a minimum amount of $100,000.
3. The number of life income beneficiaries, and the generations across which beneficiaries may span are negotiable based on meeting Internal Revenue Code requirements for remainder values, generation skipping tax implications for the donor, and the funding amount.
4. The charitable contribution to SAUF is computed to be $20,000 or more.
5. In no event shall mortgaged property be accepted.
SAUF encourages donors to consult their own legal counsel and tax advisors to create a charitable remainder trust. When requested by the donor, SAUF will provide sample documents and calculations for the donor and his or her advisors to review.
V. POLICY EXCEPTIONS
A. General exceptions – Exceptions to this policy must be approved by the SAUF Board of Directors.
B. Exceptions for completed gifts and gifts under negotiation – Gifts made through estate plans that have been properly executed prior to the date of this policy, and gifts already received by SAUF are “grandfathered” in under this policy. Gifts under negotiation at the time this policy is adopted need not conform to the policy but will be accepted based upon the spirit of this policy and the specific terms negotiated with the donor.
VI. AUTHORITY TO NEGOTIATE
The SAUF Board authorizes the Executive Director and his/her delegates to negotiate on behalf of SAUF acceptable gifts (other than cash and listed securities). Gifts negotiated must be in consonance with this policy.
The Board authorizes the Executive Director or any delegate working through the planned giving program, and any advisor or outside counsel deemed necessary, to negotiate life income gifts – charitable remainder trusts, charitable lead trusts, pooled income fund gifts, gift annuities – both intervivos and through estate planning.
Negotiated gifts shall be submitted to the SAUF Board of Directors or the Executive Committee for approval. They may seek the advice or input of any party they deem appropriate to make a fiscally, legally, sound decision in accepting any gift.
Modified: February 26, 2010 at 2:52 pm
