UCSD Gift Processing

1. UCSD Gift Processing

2. Content • This is a very short course designed to help Development Officers and staff process gifts. • We generally teach a four-hour class on the topic via Staff Education, so….we will not be able to cover everything here today.

3. Responsibilities Generally speaking system-wide, Advancement Services Offices are responsible for: • Reporting all PRIVATE SUPPORT to the campus for the year and for campaigns. • Processing all GIFTS. • ER IT&FS is responsible for these items at this campus.

4. Overarching Guidelines What must we ALL adhere to, in order to carry out our role? • UCOP Policies and Delegations of Authority • UCOP Development Policy and Administration Manual • UCSD Policy and Procedure Manual • UCSD Foundation Policies and Guidelines • CASE Management Reporting Standards • IRS Regulations • Other legal/ethical considerations

5. DEFINITIONS • PRIVATE SUPPORT All gifts and private grants (not contracts) provided by private (non-government) entities (CASE definition) • GIFT Given with charitable intent and without consideration (legal definition)

6. Resources • UC Development Policy and Administration Manual http://www.ucop.edu/ucophome/policies/devpol/ • UCSD Policy and Procedure Manual: 1. Classification et al of Awards from Private Sources PPM 150-35 http://adminrecords.ucsd.edu/PPM/docs/150-35.HTML

7. Resources (Continued) • UCSD Policy and Procedure Manual • UCSD Gift Fee Policy PPM 410-3 http://adminrecords.ucsd.edu/PPM/docs/410-3.HTML • UCSD Minimum Gift/Naming Policy PPM 410-4 http://adminrecords.ucsd.edu/PPM/docs/410-4.html

8. Resources (continued) • CASE Management Reporting Standards Order phone: 202-328-5900 or http://www.case.org/books/myProducts.cfm

9. DONEE Entities • Within the UC System, there are generally TWO legal entities to which gifts can be made: • The Regents of the University of California OR • The Campus Foundations: HERE, it’s UCSD Foundation

10. Regents vs. Foundation What’s the Difference? • It is important to Understand the Difference Between These Two Entities in Order to Correctly Process Gifts • Knowing how best to solicit and process a gift will help expedite it! • Truth is…either The Regents or the Foundation can accept gifts, and UCSD Gift Processing handles both. • SO……………………………

11. How Does One Determine which entity a gift should go to? There are some general rules……

12. Gifts to The UC Regents • Gifts in Kind that are to be kept and used by UCSD (e.g.): • Computers • Equipment • Other (many examples here) • One time gifts typically generated by faculty that will be expended and not replenished • Fellowships with a named Fellow and an application process; money really belongs to the Fellow

13. Gifts to the Foundation • Ongoing gifts that will continue (annually solicited gifts) and most events with a gift component • Most gifts solicited by Development • Significant gifts-in-kind to be sold (typically handled as a planned gift) • Capital project gifts (again, Development solicited) • Most Endowed Gifts

14. Delegation of Authority for Gift Acceptance • Over $5 Million: UC President • Up to $5 Million: Chancellor • Up to $1 Million: VC- External Relations • Up to $250,000: AVC: Development • Up to $100,000: Director, IT &FS • Up to $50,000: Manager, Gift Administration • Up to $25,000: Manager, Gift Processing NOTE: The Foundation must have all gifts in excess of $5 million accepted by the UC President as well.

15. What do we need to Process a Gift to EITHER The UC Regents or the UCSD Foundation? • A proper gift letter from the donor, or solicitation letter sent to the donor (required for all gifts over $10,000, otherwise encouraged) http://plannedgiving.ucsd.edu/giftagreements.htm • Check (unless it is only a pledge) • Copy of a thank you if already written by the department

16. What do we need to Process a Gift to EITHER The UC Regents or the UCSD Foundation (continued)? • A proper University or Foundation fund number the gift may be placed in, or a request for a new gift fund if none • Economic Interest Statement from the faculty member if applicable. http://adminrecords.ucsd.edu/PPM/docs/200-13.html

17. What do you need in addition for a Regents gift? • A completed Regents Gift Acceptance form (can be ordered from the Storehouse, form number FO2035, or use the online version: http://www-er.ucsd.edu/giftprocessing/pdf_excel/GiftAcceptanceForm.xls

18. What do you need in addition for a Foundation gift? • Nothing, unless a new fund needs to be established. • If so, a completed Foundation Fund Information form and Signature Form http://www-er.ucsd.edu/foundationDir/FDN-ACT/fundfrms/Forms.htm

19. What happens to a Regents Gifts once processed? • Deposit gift • Key into Millennium • Receipt and thank donor • Allocate the gift on the University Fund Accounting system • File our back-up information Note: Only after a gift is allocated will the gift show on the Department ledger for spending.

20. What happens to a Foundation gifts once processed? • Deposit gift • Key into Millennium • Receipt and thank donor • Provide to Foundation Accounting for allocation in the Foundation’s Fund Accounting system (for access by Departments) • File our back-up information

21. Spending a Regents Gift • Gifts may be spent from the ledger in accordance with normal ways to expend all University funds • Check request • Travel • Purchase order • Payroll costs These funds work like a check book

22. Spending Foundation funds • Departments request use of Foundation funds by lump sum transfers to the University • The transferred funds are placed in a University Fund by Foundation accounting personnel. • Departmental personnel then expend the funds in the same manner as other University funds

23. Endowed Funds • Endowments can be held by either Regents or Foundation • Preferred - through the Foundation • Endowed funds need special gift language, since they are held forever and invested by law. http://plannedgiving.ucsd.edu/giftagreements.htm • Endowments are held and invested in perpetuity • This means the principal is never spent-it is invested to grow over the long term.

24. Endowed Funds (continued) • The Regents & The Foundation have very similar Endowment Spending Policies for spending some of the return on an endowment. This “spending” is then made available to the Departments.

25. Gifts-in-Kind • Gifts in Kind generally must have a related use for UCSD to be able to accept them (Certain exceptions for appreciated property). • Typically valued at their fair market value. • However, if there is an educational discount that UCSD would have received if they had purchased the items donated, the gift will be valued at the educational discounted amount.

26. Gifts-in-Kind (continued) IRS Requirements: Donor will need an appraisal if the fmv is $5,000 or more, and will have to submit an IRS 8283 form with tax return 8283 Form http://www.irs.gov/pub/irs-pdf/f8283.pdf 8283 Instructions http://www.irs.gov/pub/irs-pdf/i8283.pdf

27. Gifts-in-Kind (continued) • Free or reduced services provided to us are NOT considered charitable gifts. Donors may report to us and deduct their out-of-pocket costs incurred in providing the services, but not the amount that they have lost in revenue. • Gifts of intellectual property are particularly difficult and tricky. Please contact gift administration for more information.

28. Gifts-in-Kind (continued) • Gifts in kind are receipted only with a description of the gift. No values are provided. The words “value as declared by donor” appears in the amount section of the receipt. Values are entered in Millennium, however, so that proper private support totals can be reported. • Donors are responsible for determining the value they will deduct, if any, on their tax returns. • Corporate donors have entirely different tax treatment than individual donors. Consult gift administration.

29. Gifts of Marketable Securities • Valuation date is the date they are received into our brokerage account (via DTC wire) or the properly endorsed certificates are delivered to a University representative. VERY IMPORTANT: Donors should not endorse the back of stock certificates. Separate stock power forms should be used. Consult with Planned Giving or Gift Administration for proper handling. • Valuation amount is the average of the high and the low price as published by the exchange on the date of the gift.

30. Gifts of Marketable Securities • Donors are advised of how UCSD calculated the value of their securities gift; however, it is the donor’s obligation to determine valuation deducted for tax purposes

31. Questions?