Issues to Consider When Requesting an Exception for a Mini-Campaign
Departments and programs may request permission to conduct a mini-campaign for a number of reasons including the establishment of a fund to honor a retiring faculty member, creating a memorial fund for a recently deceased faculty member or student, or launching a new programmatic initiative. There are, however, several practical issues and questions to consider before pursuing these funds:
- What type of an account or endowment does the department/program want to establish?
- An Expendable account (known as a “32 account”) – an account administered by the IU Foundation in which all monies may be spent at the discretion of the account manager. This type of account is invested in a short-term fund and thus does not earn significant interest.
- An Endowment account (known as a “37 account”) – a permanently restricted account administered by the IU Foundation in which the principal is protected and only the income may be spent. These accounts typically generate income for the department/program at a rate of 5% annually. For mini-campaigns establishing funds to honor a retiring faculty member or to memorialize an individual, these are the most preferred accounts by donors as they provide for an award in perpetuity.
- An Expendable Endowment account (known as a “38 account”) – an account in which the funds are invested along with the IU Foundation’s pooled funds and earn interest accordingly, but in which the total may be spent at the discretion of the account manager at any time.
- What level of income needs to be generated annually for this award/scholarship/program to be meaningful? What amount of money (i.e. gifts from donors) can be reasonably expected to flow to this account?
- The IU Foundation requires a minimum of $10,000 to be received within a five-year period in order to create a permanently endowed fund. If the mini-campaign fund drive does not reach this goal by the fifth year, then the fund is expended in accordance with the intent established in the gift agreement.
- If the department/program believes the fund can be permanently endowed with $10,000, the mini-campaign will most likely be successful if the fund is set up such that all earned income is re-invested during its first years. Please be advised that this means that there would be no spendable income for the first five years (or until the fund balance reaches $10,000).
- If the department or program does not believe the fund can be permanently endowed with $10,000, then it will be best handled by having individual gifts be sub-accounted in the department’s/program’s general fund.
- If the goal is to establish an endowed account, the department/program must work with a College of Arts and Sciences major gift officer to create a “gift agreement”. An individual must be designated to represent the department/program and must be authorized to sign the gift agreement.
- If the goal to get to $10,000 within five years, what individuals are likely to emerge as “lead donors”
in this effort?
- It is exceedingly rare for a fund like this to reach the $10,000 threshold in five years unless there will be one or two donors who will make contributions to get it well beyond the halfway point, and typically more than three quarters of the way.
- Will the solicitations be small-scale, face-to-face (mostly faculty, family members, etc.) or are does the department/program envision having a letter (print or electronic) as a solicitation piece?
- If the latter, the solicitation piece must be reviewed by the College’s Office of Advancement, and then forwarded to the IU Foundation for approval before it is mailed out. The major gift officer with whom you work with will coordinate this process.
- Does the department/program plan to run a solicitation piece in a newsletter and/or a social media site?
- If so, the solicitation piece must be reviewed by the College’s Office of Advancement, and then forwarded to the IU Foundation for approval before it is mailed out.
- Who will be the signor on the letter? If the goal is to create an endowment, would the lead donor(s) be willing to be the donor representative who signs the gift agreement?
- This is the best way to ensure that the lead donor(s) is/are properly stewarded and routinely kept apprised of progress with the fund.
FOR ADDITONAL INFORMATION CONTACT:
Office of Advancement
College of Arts and Sciences
790 East Kirkwood Ave.
Bloomington, IN 47405-7101