Gift Services FAQ

Standard written gift agreements include:

• A description what is being given (amount and gift tender type- i.e. cash, stock, Gift-in-Kind)
• What entity the gift is being given to (The Regents or the UC San Diego Foundation)
• A designated purpose and fund type (restricted or unrestricted, current or endowed)
• A statement that the gift is "irrevocably" contributed
• Identification of who will administer the fund (the administrator of the fund or "the Chancellor")

If the gift is to be used to create a new endowment fund additional language is needed regarding the agreement (or "terms") that is established between the University and the donor.

The gift agreements used by UC San Diego and the UC San Diego Foundation have been standardized and disseminated to Development Officers for use. Sample gift agreements can be found at Gift Agreements.

It should be noted that many significant gifts are negotiated over a period of time. During that period, the gift agreements are reviewed and critiqued by Gift Services and the Director of Advancement Services, as well as many others prior to finalizing them with the donor.

Standard pledge agreements essentially include the same disclosures as a gift agreement. The primary difference is where a gift agreement accompanies a gift, a pledge agreement commits to a specific amount to be paid at a future date. There must be a written donor letter, and it must include the statement that is it "irrevocably pledged" and include a date certain for payment or payments. Pledges may be paid over a period of years in annual, semiannual, quarterly, or monthly installments, with payments to begin at the donor's convenience. To record a pledge, we must have confidence the donor is known and that payment is likely.

As with significant gifts, pledge agreements for significant gifts may also be negotiated over a period of time. Due diligence regarding the donor's ability to fulfill the pledge terms may need to be completed before acceptance of the pledge.

UC San Diego records Gifts in Kind for non-monetary assets (e.g., computer equipment, artwork, books, animals) donated for related educational purposes.

Gifts-in-Kind donated for related educational purposes are generally processed through the Regents as the UC San Diego Foundation does not have the infrastructure to inventory and maintain these gifts. Gifts-in-Kind are recorded at their fair market value as determined by an appraiser or under certain circumstances by an appropriate department official. The University requires physical possession of the gift-in-kind to affect the asset transfer. The date of gift is based on both the date the deed is signed and the date the possession of the item is accomplished.

When do you need to send a proposal to the Office of Contracts and Grants (OCGA) for approval prior to submitting it to a foundation? Awards come to the university usually in the form of gifts, grants and contracts. In accordance with CASE Management Reporting Standards, we classify all gifts and grants from private sources as private support. Contracts are not private support as they are not charitable gifts.

All awards classified as grants or contracts are handled by OCGA and usually are subject to the University's indirect cost assessment. UC San Diego negotiates this rate with the federal government and applies it to both federal and non-federal awards. Contracts and grants are not assessed the 6% gift fee.

The distinction between a gift and a grant is rarely based upon the presence or absence of any single characteristic; instead, the totality of the situation, including the donor's intent, is reviewed.  OCGA makes the final decision after consultation with Gift Services.

The distinction basically derives from the degree to which the grantor places restrictions that would impede the acceptance and the use of the award. With a gift, no contractual requirements or other enforceable obligations are imposed. The grantor of a gift may make certain requests such as a brief technical report, a stewardship report or acknowledgement of support in appropriate research and other publications.

Please note:

• All awards from government agencies are classified as grants (or contracts) and are handled by OCGA.
• All awards for fellowships are initially handled by Gift Services but may ultimately be a grant or a contract.
• Most foundations refer to their awards as "grants." The use of such terminology does not affect the classification of the award. We do not ask foundations to rewrite award letters and agreements so that the word "gift" is used instead of "grant." Changing the term does not change a grant into a gift or vice versa.

Triggers:

An award may be classified as a grant and thus subject to review and management by OCGA if the grantor requests any of the following:

• a detailed line-item budget including faculty salaries as part of the proposal
• the right to license any inventions or software created
• the return of any unexpended funds
• the right to terminate the work at the grantor's discretion
• an audit conducted by or on behalf of the grantor
• a detailed technical report of research results
• a formal report of expenditures
• terms and conditions stating a precise scope of work
• terms and conditions stating  a precise time period
• any enforceable obligations in connection with the acceptance or use of the funds

Other factors that may indicate that an award is a grant are as follows:

• Previous awards from the funding source were classified as grants
• The funding source is a "disease-specific" agency, e.g. The Arthritis Foundation, Juvenile Diabetes Foundation
• The award is the result of a peer-review or Request for Proposal (RFP) process or competition
• The funds are to be used to augment an existing contract between the grantor and grantee for a specific research project
• Payments received will be based on specific expenses incurred
• The researcher has an existing consulting agreement with the grantor which is related to the researcher's area of interest

UC San Diego PPM 150-35 is policy document that both OCGA and Gift Services must follow to ensure that awards to UC San Diego are properly classified.

When a donor makes an online gift and their credit card is successfully charged, the donor, Gift Services, and the appropriate campus department automatically receive e-mails with a confirmation number and details on the gift. The donor also receives an electronic acknowledgement/thank you for their gift. A standard gift receipt will also be mailed after the donation is recorded in the donor database to either a Regents or UC San Diego Foundation gift fund. We accept donations made with Mastercard, American Express, Discover and by e-Check. Please note the bank charges a processing fee of approximately 3% for each credit card transaction which is charged to the fund receiving the gift.

To make a credit card or e-Check gift on-line, please go to our secure on-line giving web site at http://www-er.UC San Diego.edu/givetoUC San Diego.

Fund Accounting Rules require all gifts with a similar purpose to be allocated to the same fund. New funds are only created when a unique purpose cannot be attributed to an existing fund.

Gift Services will set up a new gift fund when a gift is received and there is no active fund that has the same restrictions as those put on the gift by the donor. A request to set up a new fund may come from a department, from a development officer, or after working directly with a donor.

Gift Services will open new funds for Regents gift as well as gifts to the UC San Diego Foundation.

All gifts and pledges received by the University are designated to either an existing  gift fund or to a new fund set up to support the purpose of the gift.

Gift Services will set up a new gift fund when a gift is received and there is no active fund that has the same restrictions as those put on the gift by the donor. A request to set up a new fund may come from a department, from a development officer, or after working directly with a donor.

Management of all gift funds is the responsibility of each department in UC San Diego. Gift Services is not the general accounting office or OPAFS, and neither they, nor we, monitor the detail ongoing activity in a University gift fund.  It is completely up to the department to ensure that gift funds are in balance and that the financial condition of the fund is not in deficit. Unlike other kinds of funds, gift funds should be monitored to ensure that the actual money is in place for spending, as there is never a guarantee that a donor will in fact pay.

Gift funds have no reporting requirements generally to donors, other than PI's typically saying thank you and advising on how the funds helped them. There is no staff in place in any central office for this level of monitoring. Those reviews were and continue to be the responsibility of the fund manager in the department and, of course, the P.I.

Similarly, department fund managers should also know the balances in their Foundation funds before committing to spending. Foundation gift funds work like savings accounts. Departments request transfers from their Foundation fund by submitting a Request for Transfer form to the UC San Diego Foundation. Foundation accounting personnel then transfer funds to a linked University fund. Once transferred, the funds are available to departmental personnel to expend in the same manner as other University funds, in accordance with donor restrictions.

We encourage departments to review all of their gift funds and to inventory them. The UC San Diego Administrative Responsibilities Handbook (please see the policy at Delegation of Authority and Potential Risk: Finance requires that officials in each area have monitoring procedures. This includes Regents gift funds and Foundation gift funds. If you have any ledgers that you do not have documentation on regarding Regents gift funds please contact the Deputy Director -Financial Systems at X20715 and Gift Services will obtain the documentation for you.

Mail solicitations generally fall into the following categories: annual fund appeals, special campaigns, capital campaigns, and new projects. The goal of any mail solicitation is to raise money for a specific purpose. However, writing a compelling appeal is only half the equation. The University, through Gift Services, has a responsibility to assure that 1) the money raised is available quickly and can be spent in the way the department intended and 2) the fund purpose meets the department's needs.

Avoiding Problems with Solicitation Letters

The University has a legal obligation to spend donations as the donors intended. Your solicitation letter governs how the money can be spent. If your letter is unclear, or if you have unintentionally misled your donors, your department may have to go back to your donors and clarify the purpose for which their gifts will be used. You can eliminate this problem by having your letters reviewed by Gift Services prior to mailing. We can also help you ensure consistency between your solicitation letters and remit devices.

Example:

A department solicits for an endowed fund. The solicitation letter states that "Your gift will be used to endow the Jane Triton Memorial Student Aid Fund." Only $3,800 is raised, falling far short of the amount required to endow a student aid fund.

The department decides, instead, to use the money to provide student aid through its current use or operations fund. Because donors have been told that their gifts will be used to establish an endowment, the department must go back to each donor and notify her/him of the proposed new purpose of their gifts.

This time consuming and embarrassing process could have been avoided if the solicitation letter had stated that "Your gift in memory of Jane Doe will be used by the technology department to provide student aid. We hope to raise enough to endow the Jane Triton Memorial Fund" at $(dollar amount) minimum. Then the department would have had the flexibility to use the funds no matter how much money was raised.

Avoiding Problems with Remit Devices

Like the solicitation letter, your remit device can contain incomplete or incorrect information that could slow down the processing of your gifts and delay your department's access to its funds. Even worse, it could create a situation in which your department is not able to spend gift money in a manner that best suits its needs. You can eliminate this problem by having your remit devices reviewed by the Manager of Gift Services. We can also help ensure consistency between your solicitation letters and remit devices.

Example:

A college solicits its alumni to raise money for a variety of needs at the dean's discretion. On the remit device, donors are offered the opportunity to check the area they would like to support: student aid, lectures, library materials, graduate fellowships, etc. A donor checks the box marked "graduate fellowship" and sends in a check for $50.

The University, which must demonstrate that it has allocated the gift according to the donor's instructions, is obligated to set up a separate fund for this gift, even if it is the only gift received for this purpose. The college could end up with small amounts of money in several funds rather than a large pot that would truly benefit it. The remit device could have informed donors that "Your gift to the College of Technology discretionary fund will benefit faculty and students through support of student aid, lectures, library materials, and graduate fellowships."

Solicitation Guidelines

• Always have your solicitations reviewed by Gift Services to ensure that your mailings include all the necessary information to easily process your gifts. You may fax a copy of your remit letter and remit form to (858) 534-8160. Forquestions contact the Manager of Gift Processing at 858-822-8159.
• If contributions are going into a UC San Diego Foundation fund, ask donors to make checks payable to "The UC San Diego Foundation." If contributions are for a Regental fund, ask donors to make checks payable to "UC Regents"" or "The Regents of the University of California."
• Allow space on the solicitation for donors to write or indicate a change of preferred home, business address, business title, e-mail address, and phone number.
• Allow space on the solicitation for donors to list their name as they wish it to appear in a publication; suggested wording: "In any published list of donors, how would you like your name(s) to appear?"
• Matching gifts can double or triple a donor's gift. Suggested wording: "__My/my spouse's employer may match my gift. The company's matching gift form ___is enclosed,___ will be mailed, or ___ company has been notified. ___ Please determine if our employer(s) has such a program. Employer(s) name(s) ___________."
• The IRS has strict regulations regarding the deductibility of donor benefits. If your donor receives theater tickets, a dinner, a sweater, etc., in return for a contribution, the solicitation must state the fair market value of the item and that its value is not tax-deductible. The amounts reported must be a "good faith estimate" of the fair market value of the benefit and not simply the cost to the University. Such Estimates are required if the donor contributes $95 or more.
• Give donors the option to decline benefits so that the tax deductibility of a gift can be maximized.
• Offer donors the option of giving by credit card. Include a check-off box for Visa, MasterCard, and American Express; a line for credit card number and expiration date; and a line for donor's signature.
• Suggest that your donors give gifts of securities. Suggested text: "____ Yes, I would like to receive information of giving a gift of securities."
• If you are soliciting for restricted support, such as building or endowment purposes, always include an optional use of proceeds provision. For example, if you are soliciting for an endowed chair and you don't reach the required minimum, an alternative purpose could be to have the income used to support seminars and lectures in the same academic field. Having this future flexibility is very important as you may not change the purpose of the fund without permission from the donors. Again, contact Gift Services at (858)-534-8159 for help.
• Somewhere on your solicitation, thank your donors for their support of UC San Diego and your department's program/project. You can never thank your donors enough.

If a gift is over $500, and designated to a named individual (PI) for research, the PI must complete a Contract of Interest form in accordance with the  State of California's Fair Political Practices Commission.

For guidelines on the form requirements, please see the UC San Diego COI- Conflict of Interest website.

In April 2008, The Regents adopted the UC Health Care Vendor Relations Policy ("HCVRP") ". This Policy, while new, supplements the provisions of the Political Reform Act and OP's "University Business and Finance Bulletin G-39 (Conflict of Interest Policy)" adding restrictions to Health Care Vendor relationships in those circumstances where the potential drawbacks of the relationship outweigh the anticipated benefit.

In compliance with this policy, the department head must complete a Gift Certification for gifts from Health Care Vendors to certify that the gift is in full compliance with the UC Health Care Vendor Relations Policy and that it is a charitable gift.

Gift Services is the office of record for all matching gifts at UC San Diego, and matching gift forms should be sent to us. If a donor sends a matching gift form to your department, you should forward it to us at the following address:

University of California, San Diego

9500 Gilman Drive #0940 (mail code is important)