8.12 Gifts | Financial Policies

Page last updated

07/25/2022

Policy Information

Policy Number: 8.12	Effective Date:
Responsible Unit: Financial Management	Last Revised Date: 07/25/2022
Email: FNSV-Financial-Management@arizona.edu	Phone: 520-621-9097

Purpose and Summary

To provide guidelines for soliciting, reviewing and accepting, processing, reporting and stewarding gifts.

Source

Internal Revenue Code, including but not limited to 26 U.S. Code §170.
Arizona Board of Regents Policy, including but not limited to: 3-207 and 7-201.

Scope

This policy applies to all University locations and units, including all University extensions, satellite locations, and off-site campus units, both domestic and international.

Definitions

Annual Giving Office: The Annual Giving Office is the university-wide resource for securing current-use revenue and regular support from alumni, parents, friends and prospective donors through gifts that are typically less than $2,500. It is responsible for coordinating all mass solicitations for the University, which are defined as direct donation requests sent to more than one constituent. These include donation appeals conducted through mail, telephone outreach, e-mail, crowdfunding, social media and other digital channels to benefit the University and its colleges, departments and administrative units.
Central Gifts Office: The Central Gifts Office provides final validation for compliance with gift policy and IRS regulations. The Central Gifts Office provides receipts for all gifts to the University and maintains a historical database of all such gifts. The Central Gifts Office is also the primary contact for questions related to gift processing.
Development Officers: Fundraisers known as development officers (DOs) are assigned centrally to the University Alumni Development Program (UADP) as well as to colleges and other selected units. DOs’ fundraising priorities and goals are established annually in partnership with the college dean/unit director and development leadership. DOs collaborate with faculty members and administrators to cultivate and steward donors and to solicit major and principal gifts.
Benefit Fair Market Value: The value attached to any benefit given to a donor in exchange for his or her contribution defined as what a reasonable person would expect to pay for the item in an open market. Any item representing more than a token fair market value, as defined by IRS policies, must be deducted from the total donor contribution to determine the tax-deductible amount of the gift.
Foundation Relations/GIFT Center: This office provides high-level strategies for external foundation prospects, facilitates visits to and from foundation leaders, matches foundation opportunities to campus strengths, provides proposal development, editing, and trainings to development officers and campus academic and administrative units, and provides stewardship guidance for foundation funders. This office also provides compliance pre-check services on all proposals/awards from foundations and corporations to the University of Arizona Foundation (Foundation).
Gift: A voluntary transfer of items of value from a person or organization where no material amount of goods or services are expected, implied or provided to the donor. Gifts normally take the form of cash, checks, securities, real property or personal property and may be restricted or unrestricted to a general area of use that benefits the University or one of its components.
Gift Commitment: A donor's intention to make a defined gift over a period of time for a specified purpose. It is not a legally binding agreement but serves to document a commitment to make a gift.
Gift Planning Office: This office maintains relationships with persons who have made gifts to the University through wills, living trusts, beneficiary designations, charitable gift annuities, charitable remainder trusts, and life insurance policies. It collaborates with professional advisors and/or persons interested in making such gifts. Gift Planning Office team members have extensive legal, financial, and practical knowledge in discussing, illustrating, soliciting, closing, and carrying out these gifts. This office receipts all estate gifts whether to the University or the Foundation. It also administers charitable gift annuities and charitable trusts for the Foundation and administers gifts of life insurance policies. See the Gift Planning Acceptance Policies for more information.
Gift Pledge: A legally binding agreement in the form of a contract, where both parties have agreed to specific described actions. Only those parties who have signed the pledge agreement may fulfill the terms of the pledge.
Sponsored Award: A payment made to the University for a project that binds the University to a specific scope or area of work that benefits the sponsor. These payments are occasionally referred to as grants or contracts; however, these are not gifts. There is almost always a signed, legally enforceable document involved. See Considerations for Routing Proposals and Awards.
The University Alumni & Development Program (UADP): Administers the University's engagement and fundraising activities and manages all gifts to the University. The UADP is led by the University of Arizona Vice President of Development/President & CEO of the University of Arizona Foundation (Foundation), an Arizona nonprofit corporation. The Foundation provides development and asset management services to the University.
Foundation's Gift Database (currently Lynx): The Foundation's gift database system of record of alumni, donors, prospective donors, and charitable gift transactions.
University Development Fund: A repository of funds to support fundraising activities undertaken by and on behalf of the University. Refer to 8.33 University Development Fund Policy and Procedure.

Policy

Gifts not processed according to these policies will not be accepted by the University or Foundation.
The UADP has the authority to approve all fundraising activities seeking gifts undertaken by and on behalf of the University or Foundation.
The Foundation’s General Counsel Office approves all contracts with outside development-related consultants and vendors.
The Development Office is not responsible for student-run fundraising events, or sponsored projects. Sponsored Projects Services (SPS) coordinates sponsored projects.
Only the President of the University or the President of the Foundation (or their designees) can accept a gift to the University or the Foundation, respectively. The acceptance is formalized by the presentation of an official gift receipt, which may only be issued by the Central Gifts Office or the Gift Planning Office.
Acceptance of any gift signifies Foundation or University willingness to administer gift funds in compliance with donor directions. Responsibility for initial acceptance lies with the Central Gifts Office. Responsibility of further monitoring of gift funds for compliance lies with the department or division head. In authorizing the acceptance of a gift, it is the signor's college responsibility for any current/future obligations.
All planned gift agreements must be reviewed by the Gift Planning Office and Foundation General Counsel Office before they are submitted to the donor.
For all projects, the faculty member, department and college are responsible for complying with University policies.
All gifts to the University or the Foundation must be processed through the Foundation's Gift Database. Once the Foundation or the University has accepted the gift, it becomes University or Foundation property and the donor has no further direct decision-making power regarding the gift.
Gifts are subject to the provisions of 8.33 University Development Fund Policy and Procedure.
Gifts must not be accepted if any of the following circumstances exist:
1. The gift is in contradiction of applicable Federal or State laws, or the Arizona Board of Regents or University policies.
2. The gift would obligate the University to undertake duties, financial or otherwise, which it may not be fully capable of meeting for a period required by the terms and conditions of the gift.
3. The gift constitutes a request to the University to operate a commercial endeavor for the sole benefit of the donor.
4. The gift cannot be properly administered within the intended recipient's normal budget or resources (for example, in the case of the requirement for matching funds or resources).
5. The gift presents an unreasonable or unacceptable degree of risk due to environmental or health/safety issues.
6. The gift is from a Restricted Party. Such potential donors, particularly foreign source donors and related entities, will require upfront disclosure and coordination with University Export Control before solicitation or acceptance. For additional information consult Procedures for Restricted Party Screening.
Gifts made with the condition that funds be spent for the personal benefit of a named individual or individuals (e.g., a scholarship for a specific student or gifts for the benefit of specific University employees) will not be receipted as charitable contributions in accordance with IRS regulations.
Gifts from a University employee cannot be directed toward the employee's own salary, research, or account from which the employee will have a direct benefit.
Gifts from Canadian citizens or entities must be deposited at the University. The Canadian government requires entities to register with the Canadian Revenue Agency in order to receive recognition as a "qualified donee" for charitable gifts. The University is a registered/approved "qualified donee" with the Canadian Revenue Agency. The Foundation is not a "registered donee." Therefore, all gifts from Canadian citizens or entities must be made payable to and deposited with the University. Also, Canadian procedures for acceptance of non-cash/in-kind gifts are much different than University procedures. As such, no Canadian-source non-cash/in-kind gifts will be processed by the University unless there is evaluation and pre-approval.

Procedures

Refer to the sections below for Gift procedures.

Frequently Asked Questions

How do I determine if an item should be routed through Sponsored Projects?
- For assistance determining if an item is a sponsored award, please see Considerations for Routing Proposals and Awards.
What are some examples of when it may be difficult to determine the donor?
1. 1. A donor maintains a fund (normally a donor advised fund) with a community foundation (e.g., Community Foundation for Southern Arizona) or a charitable gift fund (e.g., Fidelity Charitable Gift Fund) and directs the foundation or fund to issue a check to "The University of Arizona" or one of its units. The community foundation or charitable gift fund, not the individual, is the legal donor, although the individual may receive "recognition credit" for the gift (see Recognition Credit for Gifts). Please note: As per IRS regulations, funds distributed from a third-party charitable organization may not be used to satisfy a personal, legally enforceable pledge obligation.
  2. Several people pool their money, giving that money to a person who writes a check as a charitable contribution. In this case, the legal donor is the person who wrote the check, not the people who provided the money.
  3. Someone gives money to an organization that collects money for dispersal to other charities, designating that the funds be given to the University or one of its divisions. The legal donor is the organization, not the individual, although "recognition credit" could be given.
  4. A legally enforceable pledge is made under an individual's name, but the pledge payment is paid with a third-party check. The tax receipt will be issued in the name of the third-party, not the individual. Please note: this payment from the third-party may not legally be applied against the personal pledge obligation unless the third-party is specifically a party to the original and accepted pledge.
  5. If a donor cannot be easily determined, please contact the Central Gifts Office for assistance.
How can a faculty or staff member who wishes to contribute to a gift account, from which they may indirectly benefit, do so?
The employee must submit a letter stating the following:
1. The gift account is for general purposes of the unit and is not specifically related to the donor's research or other work.
2. The funds from the gift account are dispensed impartially and the donor is not the authorized approver on the account.
3. The sum of the gifts from the donor, his or her immediate family, and/or other related entities do not constitute the majority of the funds in the account.
4. This letter must be signed and dated by the faculty or staff donor, approved in writing by the responsible Dean or Department Head, attached to the gift report and forwarded to the Central Gifts Office. The Central Gifts Office will forward the letter to the appropriate fund accountant with Sponsored Projects Services.
Note: A letter is not required for non-designated pooled donations made to the Foundation for UA Cares when the funds are dispensed impartially (3.b.) and the account is not majority funded by the donor, his or her immediate family, and/or related entities (3.c.).
When would a Gift Pledge be required?
Gift pledges are required when the gifts support activities that require borrowing of funds commercially to meet University objectives, capital construction projects where facility naming rights are used as part of the acknowledgment process or other circumstances where the University or Foundation is relying on the pledge.
Can funds in a University Gift account be transferred to a Foundation account?
No, funds gifted to the University must remain in a University account.
Can gift funds be directed to specific individuals?
The University or Foundation accepts gifts for specific areas or departments or to support specific research areas under the direction of specific individuals but does not accept gifts designated for specific individuals.
Where do I direct tax concerns from a donor regarding gift funds?
University of Arizona employees, while in their official role at the University, are not allowed to act as tax consultants or provide tax advice. Donors should be directed to consult with their tax advisor.
How do I learn more about the current Foundation Gift Database?
For more information on training and questions regarding the Gift Database, visit the Foundation webpage.
Where are gifts deposited?
The only two authorized repositories for gifts are the University and the Foundation. The University and the Foundation consider all gifts to be irrevocable.

Gift Planning Acceptance Policies
University of Arizona Foundation
Foundation Gift Database
Sponsored Projects Services
Research, Innovation and Impact
Central Gifts Office
8.13 Endowments
8.33 University Development Fund Policy
University Export Control Policy
In-Kind Gift and Construction In-Kind Gift Forms (please contact the Central Gifts Office)

Please note that sections titled Frequently Asked Questions and Related Information are provided solely for the convenience of users and are not part of the official University policy.