- An endowed gift is one in which the original principal is never invaded and the gift exists in perpetuity. Endowments are generally funded within five years of the initial contribution. Income is distributed annually pursuant to policies adopted by the University of Georgia Foundation.
type of endowment determines the type of fund agreement required. Please see
the next section “Endowment Levels” for the various kinds of endowed
funds and the minimum funding required to establish each one. There are
generally four endowed fund agreement formats. They are:
- Endowed – This agreement is used when the initial gifts are sufficient to meet the minimum endowment balances. This type of fund is subject to support fees, investment fees, and earnings from both short-term and long-term investments.
- Time-Period Specification – This agreement is used when the total gifts will be received over a time-period. This time-period is generally three to five years. The time-period is indicated in the fund agreement and expenditures from the fund are prohibited until the minimum funding has been reached.
- Chairs / Professorships – All chairs and professorships are generally created as an endowment. Language that satisfies the University of Georgia and Board of Regent requirements for hiring professors to a named chair or professorship position is included in the agreements.
- Declaration of Trust – This agreement is used when the gifts are received through a deferred mechanism. The donor(s) is deceased and the gift(s) has been received through a deferred gift or from the estate. A planned gift agreement or will is usually the source for drafting this type of agreement (a declaration of trust may also be a non-endowed agreement).
non-endowed gift allows for the gift to be spent to support the trust purpose.
There are two types of formats for non-endowed fund agreements. They are:
- Non-Endowed – A non-endowed fund generally generates no investment earnings and is not assessed a support or investment fees.
- Declaration of Trust – This agreement is used when the gifts are received through a deferred mechanism. The donor(s) is deceased and the gift(s) has been received through a deferred gift or from the estate. This fund follows the same criteria as the endowed declaration of trust, except that the donor’s intent is for the entire gift to be expended for the purpose indicated by the gift transmittal, a deferred gift arrangement, a planned gift agreement, a will, or any other document which transfers the estate gift to the Foundation.
- A non-endowed gift allows for the gift to be spent to support the trust purpose. There are two types of formats for non-endowed fund agreements. They are:
Types of requests that require a new agreement, not an addendum are:
- Change from non-endowed to an endowed fund, or
- Change in purpose of fund.
An addendum is used to make minor modifications to the original fund agreement. Changes to the original fund agreement are not encouraged and should be done on a case by case basis. Some types of modifications that may be considered are changes to scholarship or award criteria and adding an additional donor or donor representative. These requests must be in writing and approved by the appropriate Dean/Vice President and in some cases the Executive Director of the Foundation.
Changes to the benefiting department name through department mergers or university renaming will be handled by the UGA Foundation Office and do not require an addendum.
Last Updated on September 23, 2019