Schola Foundation
Gift Acceptance Policy and Procedure Guide
PURPOSE
Schola Foundation (SF), encourages the solicitation and acceptance of gifts that will help SF further and fulfill its mission of facilitating and promoting Catholic education. Given the complexity of IRS regulations, the potential volume of real estate and other property gifts, and state and federal environmental laws, SF recognizes the value in carefully screening proposed gifts. SF, including its directors and officers (Board) must assure that gifts accepted by SF do not place other assets of SF at risk, and that they can be readily converted into assets that fall within SF’s investment guidelines. This Gift Acceptance Policy and Procedure Guide (Policy) sets forth procedures and guidelines governing the review and acceptance of gifts made to SF for the benefit of its programs.
AUTHORITY
All assets gifted to SF shall be, without limitation, subject to the following reservation of powers and rights of the Board:
To accept or refuse any proposed gift.
To modify or eliminate any restriction, condition, limitation or trust imposed with respect to any funds or property the title to which has become vested in SF if, in the sole judgment of the Board, such restriction, condition, limitation or trust becomes unnecessary, incapable of fulfillment or inconsistent with the charitable needs of the community or area served by SF.
In conformity with U.S. Treasury Department regulations gifts to SF may not be directly or indirectly subjected by a donor to any material restriction or condition that would prevent SF from freely and effectively employing the transferred assets or the income derived therefrom in furtherance of its exempt purposes
The Executive Committee of SF shall serve as the Gift Acceptance Advisory Committee (Committee), in evaluating whether to accept certain complex gifts and assets. The Committee has the responsibility to review and recommend the acceptance or rejection (Committee Review) of complex gifts and funds, as may be determined by SF from time to time. Examples of circumstances in which Committee Review is requires are set forth in Appendix I.
Committee Review will include, at minimum but without limitation, consideration of the following criteria:
Furtherance and fulfillment of SF’s mission.
Charitable intent and benefit to education.
Nature and extent of proposed gift restrictions.
Permanency of the gift; or in the case of a non-permanent fund, the likely duration of the fund.
Projected costs of managing the gift asset.
Fee generation to SF for gift administration.
Impact of acceptance and ownership of gift assets SF’s financial condition and liquidity.
Financial and reputational risks and liabilities associated with acceptance and ownership of the gift assets.
Fees and disbursements expended by the donor including without limitation as described in Appendix II.
PROCEDURE FOR COMMITTEE REVIEW
Upon the presentation of a potential gift, the circumstances of the proposed gift will be referred to the Committee. Referral may be by meeting, telephone, written or electronic communication, or such form of communication reasonably available to all Committee members. Professional advisors may be consulted as deemed necessary by SF. The Committee shall make a recommendation to the Board as to acceptance or rejection of a proposed donation of a gift asset. The Committee’s recommendation shall be by decision of a quorum constituting at minimum a majority of the Committee members and shall be reduced to writing. Minutes of all Committee meetings shall be prepared for review by the Board at least quarterly.
CONFLICTS OF INTEREST
To effectuate this policy, SF relies on the good judgment and integrity of its directors and officers. SF encourages a culture of transparency in which such individuals fully and promptly disclose all affiliations, interests, and gifts of which they are aware that might present a conflict relating to a potential transaction or might otherwise affect their objectivity. Directors and officers shall bring to the attention of their SF colleagues and staff, all personal and professional interests or affiliations that might conflict with their duty to SF. In situations where conflicts are uncertain, SF encourages individuals to err on the side of caution and disclosure and shall avoid at all times any perception or appearance of a conflict of interest or impropriety. In addition, it is SF’s policy and mandate to comply with the Model Standards of Practice for the Charitable Gift Planner disseminated by the National Committee on Planned Giving.
APPENDIX I
GIFTS SUBJECT TO REVIEW
The following, without limitation, are examples of types of gifts that may be subject to Committee Review:
Interests in business entities (e.g., closely-held corporations, partnerships and limited liability companies).
Trusts funded with assets other than cash or publicly traded securities, and/or with terms that otherwise fall outside of the SF’s policies for acting as Trustee of a charitable trust.
Testamentary transfers of incentive stock options (ISO) and non-statutory stock options (NSO) or lifetime gifts of publicly traded stock obtained through the donor’s exercise of ISOs or NSOs.
Rights in intellectual property such as copyrighted materials, trademarks and patents, and royalties.
Interests in tangible personal property.
Other property that may be unusual or fall outside the type of gifts usually handled by SF.
Promissory notes or other instruments of indebtedness.
Interests in organizations supporting donors or donor contributions.
Other assets or interest as may be required by the Board or Executive.
APPENDIX II
GUIDELINES REGARDING GIFTS THAT REQUIRE COMMITTEE REVIEW
The Committee’s review should include consideration or need for review of:
The impact of the use or image of the property on SF’s mission and strategic plans.
Impact of donor designated restrictions on SF’s mission and strategic plans, and potential to violate the terms of the corporate charter, tax exempt status of SF.
Compliance with applicable laws and regulations of federal, state and local governmental entities, including without limitation the Internal Revenue Code.
Potential effect on SF’s overall liquidity and risk profile.
Ownership or title of the gift asset.
Periodically updated financial information and/or appraisals.
The donor’s independent appraisal and IRS Form 8283 at time of the gift or as such other time as recommended by the Committee.
Valuation by a qualified appraiser, whether at the expense of the donor or SF.
Value of the gift asset relative to associated expenses and liabilities pending liquidation.
Whether the asset can be liquidated within a reasonable time period.
Risks and burdens associated with operation and administration of a gift asset pending liquidation.
Need for budgetary contingency plans and the extent to which Board oversight of budgetary processes are indicated.
The need, if any, to prepare an annual operating budget and maintain financial reports of the actual performance of the asset compared to that budget so as to prudently manage any ongoing revenues generated or costs incurred related to the asset. Should such a process be deemed necessary, there should also be established a normal cadence whereby the performance of the asset against the budget will be reviewed with the Board.
Establishment of the proper thresholds whereby specific material changes to the asset or significant costs that have arisen and are likely to be incurred will be referred to the Board for its approval.
Development and recommendations of procedures and deadlines for the timing of asset liquidation.
Potential liability or adverse consequences for SF (e.g., capital calls on limited partnerships, the issuance of warranties, representations, indemnification agreements, or covenants not to compete, operating losses, liens, contracts, leases, management agreements, mortgages, unpaid taxes or assessments and environmental matte
Consequences for acceptance of assets located outside of the United States.
Expenses to the Donor or SF pending liquidation of the gift asset (e.g., for appraisals, attorney fees, real estate taxes, assessments, insurance, maintenance, preservation, repair, insurance, unrelated business income tax, appraisal fees).
Physical condition of real estate or personal property assets, including without limitation applicable building, health, and safety codes, need for repairs or improvements, and the source and adequacy of any funds necessary for such matters.
Exposure to SF for financing ownership of the gift asset
Marketability of the gift asset or income stream royalties, distribution rights or intellectual property.
