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UNT
Home » Office of Development
» Foundation » Policies and Procedures Manual
GENERAL INFORMATION
The Mission of the UNT Foundation
Structure of the Foundation
Staffing the Foundation
Board of Directors Volunteer Position Description
Conflict-Of-Interest Policy
Directors and Officers Liability
Communicating with the Board
Nondiscrimination/Equal Opportunity/Affirmative Action/Sexual Harassment Policy Statement
Whistleblower Policy
Public Information
ACCOUNT MANAGEMENT
Definitions throughout this Manual
Establishing a New Account
Types of Accounts
Account Holders
Deposits (Contributions) to Accounts
Procedure for Acknowledging and Receipting Gifts
INVESTMENT MANAGEMENT
Endowment Account - Investment Vehicles
Operating Account - Investment Vehicles
Bank, Cash and Funds Management Accounts
Investment Policy
Appendix A
Appendix B
Appendix C
OBTAINING FUNDS FROM ACCOUNT
Withdrawals of Amounts from Endowment Accounts
Distribution Policy
Fees Charged to Endowed Accounts
SPECIAL INFORMATION
Funding Requests from Foundation Unrestricted Assets
Executor Functions
Trustee Functions
GIFT PLANNING AND ACCEPTANCE POLICIES
Overview
Liquidation of Gifts
Appraisal
Tangible Personal Property
Life Insurance
Guidelines for Gifts of Life Insurance
Gifts of Cash
Securities
Individual Wills
Charitable Gift Annuities
Charitable Remainder Trusts
Management
Real Estate Policies
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GIFT PLANNING AND ACCEPTANCE POLICIES
Overview
In keeping with the objectives of the University of North Texas Foundation, Inc., the following guidelines regarding gifts to the Foundation have been developed.
Professional Counsel
- Each donor is encouraged to seek professional advice and counsel about any gift made to the Foundation. Members of the Foundation Board of Directors and University of North Texas Development Office staff will not supply professional counsel or advice to donors about tax liability, estate planning, and comprehensive investment planning. Board members and UNT staff will aid donors in examining these issues; they will aggressively encourage donors to seek appropriate independent professional counsel about their personal situation.
Liquidation of Gifts
- All gifts made to the Foundation will be held or liquidated based upon the decision of the Board. It is the practice of the Board to convert gifts into manageable, income-producing assets as soon as practical. The various endowed assets of the Foundation are preserved for current and future earnings, and will not be liquidated for operating funds. Unendowed gifts designated in support of operating expenses or specific projects may be liquidated by the Board at their sole discretion.
- The Board reserves complete control of all decisions about the liquidation of any asset given to the Foundation. Under no circumstances is the Board bound to share with any donor its investment decisions or use of any specific asset given as a gift beyond the specifications of the Memorandum of Understanding. Under conditions determined by the Board, discussion of possible uses or liquidation strategies for a gift asset with a donor is advisable.
- Upon the advice of a donor, the Board may decide to use a suggested broker to liquidate a particular asset. The Board is not limited to the use of any particular broker for these purposes.
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Appraisal
- Gifts of non-cash property other than publicly traded securities, and closely held stock valued at less than $10,000, must adhere to strict appraisal rules if the value of the property is more than $5,000. A timely qualified appraisal of such a gift must be supplied by the donor. The IRS 8283 form shall be filed within sixty (60) days of receiving the gift under most circumstances. The costs of appraisal will be borne by the donor, unless these costs are specifically authorized by the Board to be borne by the Foundation.
- Property subject to appraisal requirements at the time the gift is donated requires that IRS Form 8282 be completed if the property is liquidated within two (2) years. The consequences of a decision to liquidate this type of gift should be discussed with the donor in advance of the Board accepting a gift.
Tangible Personal Property
- The "ordinary income reduction rule" under section 170 of the Internal Revenue Code reduces the value of the charitable deduction for tangible personal property to cost basis (usually original cost) for anyone who created the property or acquired it from the creator. This rule primarily applies to artwork, and the resulting charitable contribution amount may be significantly less than the current market value.
- The "partial interest rule" under Section 170 denies a charitable contribution for a gift of less than a person's full ownership interest in tangible personal property (for example the transfer of a painting while retaining the copyright interest in the artwork).
- The "future interest rule" specifies that a person may not transfer a future interest in tangible personal property and receive an income tax deduction (for instance, contributing a painting to a charitable remainder trust - no deduction would be allowed).
- The "related use rule" applies to virtually all outright and deferred gifts of tangible personal property. Generally, tax deductions are limited to gifts of tangible personal property unless it is put to "related use" by the Foundation. A "related use" is a purpose within the tax-exempt mission of the organization. With some exceptions, if the property is put to an unrelated use (including immediate sale at auction or otherwise), then the donor is allowed to deduct his or her basis in the property.
- All tangible personal property received as a gift will be reported in accord with these IRS rules, and donors shall be made aware of these unique tax consequences before any such gift is accepted.
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Life Insurance
- Donors wishing to make a gift of Life Insurance should indicate on any Life Policy that the owner and sole beneficiary of the policy is the "University of North Texas Foundation, Inc." Donors giving pre-paid (fully funded) policies or new policies that name the Foundation as sole owner and beneficiary, shall receive recognition for the replacement value of the policy.
- Donors who name the Foundation as a beneficiary of any life insurance policy without also naming the Foundation as sole owner, shall receive the thanks of the Board for this future gift, but no tax advantages or other benefits shall accrue.
- Donors wishing to make regular contributions to the Foundation that would be applied to a life insurance policy, the sole owner and beneficiary of which is the Foundation, shall use the "Gifts of Life Insurance" procedures in effect at the time for this type of gift.
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Guidelines for Gifts of Life Insurance
These Guidelines are for donors who are considering a gift to the University of North Texas Foundation through contributions of cash to the Foundation that will be used to pay premiums on a life insurance policy.
- The owner of the policy shall be University of North Texas Foundation, Inc.
- The sole beneficiary of the policy shall be University of North Texas Foundation, Inc.
- The policy must be whole life. Term, group, variable, flexible premium, universal life policies, or other product variations that are not whole life policies will not be accepted without prior approval.
- Coverage of the policy shall be on the life of the donor, only.
- The minimum age of any donor making a gift of life insurance shall be 45 years at the start of policy coverage.
- The minimum face amount (death benefit) of the policy shall be $50,000.
- All correspondence, policy applications, and original premium notices shall be sent to:
University of North Texas Foundation
Insurance Program
P.O. Box 311250
Denton, Texas 76203-1250
for action and signatures, as applicants and/or owner, by the appropriate UNT Foundation representative.
- The policy SHALL NOT incorporate an automatic premium loan provision.
- The policy SHALL carry a disability waiver of premium endorsement.
- The policy SHALL incorporate a vanishing premium schedule with a maximum payment period of ten (10) years.
- Premium payments shall only be made on a quarterly, semi-annually, annually basis, or through a single initial payment.
- When a federal Employer Identification Number (EIN) is required, the proper number to use is: #23-7232618.
- University of North Texas Foundation, Inc. shall have physical possession of the policy and the underwriter shall issue a duplicate policy or certificate of insurance to the insured.
- Prospective donors providing a gift of life insurance are requested to provide the University of North Texas Foundation with the name, address and telephone number of the executor or administrator of their estate.
- Donors wishing to use a gift of life insurance to meet the lifetime membership requirements for any UNT affiliated organization must make up any shortage between the normal annual membership fee for the organization and their annual insurance premiums with annual gifts of cash before February 1 each year until the insurance policy is fully funded and the insurance premiums have vanished. Until the policy is fully funded and the premiums have vanished, the donor is considered to be an annual member of the organization; once fully funded the donor becomes a life member of the organization.
- Individuals considering any gift of life insurance should contact the UNT Foundation Office at (940) 565-4555 or have their insurance agent contact the UNT Foundation Office once a proposal has been prepared, and before the final application is completed or any funds paid for premiums. The final decision to accept any gift of life insurance rests with the University of North Texas Foundation, Inc.
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Gifts of Cash
- Gifts of cash may be made to the Foundation at any time and will be accepted as outright contributions. Payments of dividends from privately held insurance policies, shares of stock, securities, or other income producing assets that are held in the name of the donor, will be treated similarly.
Securities
- Publicly traded stocks and bonds that have current marketable value will be accepted at any time. Valuation of the gift shall be the average of the high and low trade prices of the security on the day it is irrevocably transferred to the Foundation. Commission and sales costs will be paid from the proceeds of the sale of the security.
- The Foundation utilizes a local brokerage house to handle receipt of all securities gifted to the Foundation. Special procedures apply to different types of stock gifts. Donors and development staff should contact the Executive Director for assistance and instructions regarding any gift of securities.
Individual Wills
- Bequests from an properly executed Will, Living Trust, Inter Vivos Trust, or Testamentary Trust shall be accepted in accord with the donor's wishes, and in accord with the mission and purposes of the Foundation. The Board reserves the right to refuse all or any part of any bequest or beneficiary designation that does not serve to further the missions of the University of North Texas and the Foundation, or for any other reason determined by the Board.
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Charitable Gift Annuities
Donors who wish to establish current or deferred Charitable Gift Annuity contracts with the Foundation may do so under the following conditions;
- the minimum contribution necessary to establish a Gift Annuity contract shall be $5,000;
- the rates of return paid on all Gift Annuity contracts shall be those established annually by the American Council on Gift Annuities, or its successor, a not-for-profit organization that sets charitable annuity rates that are approved for use by charitable organizations by the Internal Revenue Service, with a minimum of at least 5% paid annually; Gift Annuities over $25,000 with rates in excess of the current ACGA rates will be considered on an exception basis, only, and any payout rate in excess of 10.0% must be approved by the applicable Foundation Committee before being accepted;
- annuity payments will be made annually, semi-annually, or quarterly to the annuitant; and,
- appropriate annual income tax return information will be supplied to the donor and filed with the Internal Revenue Service by the Foundation’s designee.
Charitable Remainder Trusts
- Gifts that seek to make use of the various Charitable Remainder Trust instruments allowed by the Internal Revenue Code will be considered by the Board individually. Grantors may ask the Foundation to serve as Trustee of a Charitable Remainder Trust that the Grantor wishes to establish.
- The minimum asset value that will be considered for any such Foundation-managed Trust shall be at least $100,000 designated for the Foundation. Real estate shall not be used to fund trust arrangements without first meeting the criteria set forth in the Gifts of Real Estate policy statement. All Trusts managed by the Foundation may be charged reasonable management fees as determined on an individual basis.
- The Board of Directors of the Foundation reserves the right to contract with any third party to serve as a Co-Trustee or Successor Trustee of any Trust for which the Foundation serves as Trustee or Co-Trustee to fulfill any or all management functions. Any resulting management fees will be borne by the individual Trust(s) so managed.
- Any Charitable Remainder Trust for which the Foundation would serve as Trustee must name the University of North Texas Foundation, Inc. as remainderman of at least 50% of the assets of the Trust. At least 50% of the remainder value must be for the benefit of the University of North Texas.
- The Foundation will not serve as Trustee of any Charitable Lead Trust due to inherent conflicts possible with this type of relationship.
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Management
- The Executive Director of the Foundation, or another entity designated by the Board of Directors of the Foundation, shall manage these gift planning and acceptance policies, and shall aid donors and University staff in planning and making gifts. The Executive Director shall oversee record keeping, ensure that all mandated State and Federal Tax filings occur, prepare and present regular reports to the Board, and prepare gift acknowledgment and donor recognition materials.
- The Executive Director shall, at the direction of the Board, take any steps necessary to promote donations and contributions to the Foundation, cultivate and educate potential contributors, and secure major gifts in accord with these policies.
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Real Estate Policies
SUBJECT: Procedure for Acceptance of Real Estate Gifts
PURPOSE: To establish general procedures for the acceptance, receipt, and documentation of real estate gifts.
PROCEDURE:
- Normal contact with a donor is handled by a UNT Development Officer (DO).
- The DO should obtain as much information as possible about the real estate such as:
- Complete legal description or a copy of the donor's warranty deed. If a copy of the deed is not available, determine the date of ownership by the donor, copy of the legal survey, etc.
- Does the donor have a title policy or an abstract of the property?
- Are there any outstanding liens or indebtedness against the real estate? If so, obtain as much information as possible including copies of note, deed of trust, etc.
- Mineral Status - Are the minerals being conveyed or retained by the donor? If minerals are being conveyed, how much do they own?
- Are there any improvements to the property such as water well, electricity, buildings, fence, improved grasses, ponds, row crops, etc? Any portion of property in a flood plain?
- Tax Status - Have the previous years' taxes been paid? Are the current year's taxes to be paid by the donor, prorated or assumed by the Foundation? Request copy of last three years paid property tax receipts from all taxing authorities.
- Are there any leases affecting the property such as farming, hunting, grazing, oil and gas or rental agreements? If so, obtain a copy of the lease or leases. Are there any easements? Is the property zoned?
- Is the gift restricted or unrestricted, endowed or non-endowed?
- What has been the principal use of the property since the donor has owned it. Secure the name of previous owner for follow-up if possible.
- Has the property ever been used in the production, storage, or disposal of toxic material? If there is any possibility of hazardous exposure, document the situation as much as possible.
- Inform the donor of the need to obtain a qualified appraisal.
- Commercial Properties (apartments, duplexes, houses, office buildings, warehouses, etc.) - The donor will be required to furnish the following information:
- Copy of the last three years income tax Schedule E on the subject property.
- Copy of current lease agreements.
- Copy of last three years paid property tax receipts.
- Any other financial information that might be helpful in evaluating this property.
- The DO will inform the donor that the above gathered information will be given to the Foundation's Real Estate Committee, the property will be analyzed, and the DO will be back in touch with the donor within two (2) weeks of receiving all information and documents necessary for proper evaluation. (DO will explain to donor that final resolution may take longer, but that donor will be kept informed on a timely basis.)
- The DO will provide the Director of Planned Giving with a copy of the property checklist as well as a statement concerning the past and potential giving of the donor and the purpose of the gift for inclusion in the property evaluation report.
- The Director of Planned Giving will be responsible for preparing a thorough report on the property. In addition, The Director of Planned Giving will include an appraisal value, if available, and a comment on the current market for the type property being considered.
- Gifts of real estate are acceptable only after it has been determined that no reasonable possibility exists that the property is contaminated with toxic waste. If potential for toxic waste has been indicated, that property, if ultimately accepted by the Foundation, must be accepted by a different entity such as a Limited Liability Corporation or an irrevocable and perpetual trust or series of trusts, as opposed to accepting the property in an endowment fund, regardless of whether or not a licensed toxic waste inspector indicates that the property is not contaminated. No exceptions may be made. The expense of the inspection will be borne by the bequest unless an exception is approved by the Foundation.
- The Property Evaluation Report will be circulated, and the Chairman of the Real Estate Committee, Director of Planned Giving, DO, and Vice President for Development will make recommendations on acceptance to the Chairman.
- If the gift is accepted, the Director of Planned Giving will explain to the DO, who will then convey to the donor how the Warranty Deed or Gift Deed should be prepared.
- Real estate and mineral interests that will be used to fund a charitable remainder trust will be deeded to the University of North Texas Foundation, Inc.
- All other real estate and mineral gifts will be deeded to the University of North Texas Foundation, Inc.
- Gifts of undivided interests will only be accepted with a value of $50,000 or more.
- When the Warranty Deed or Gift Deed is received, it should be delivered with all documentation and correspondence to the Director of Planned Giving. At this point, a permanent file will be opened and the gift will be booked and receipted.
- The property will be inspected at least annually to evaluate the current condition of the property and review the market approach with the real estate company listing the property until the property is sold.
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SUBJECT: Environmental Guidelines
PURPOSE: To provide guidelines for the acceptance of real estate in order to minimize potential liability for damages and clean up of properties contaminated by hazardous waste.
GENERAL: Due to strict environmental laws concerning real estate, the Foundation as a land owner could have significant liability on properties contaminated by hazardous waste.
PROCEDURE:
- Prior to accepting farms, ranches, urban acreage, commercial, and industrial real estate, a Phase I Environmental Site Assessment will be performed on the property.
- The environmental assessment will include but not be limited to the following:
- Documentation of the geographic location of the property and current usage.
- Site operational history, which will entail:
- Document current and prior ownership based on information obtained from area plat books, and title search;
- Document current and past usage based on historical aerial photographs, historical city directories, and fire insurance maps.
- Environmental site characteristics, which will encompass:
- Geology and soils characterization, to include topography and soils types;
- Ground water characteristics, to include aquifers, depth to usable groundwater, special groundwater districts;
- Surface water characteristics, to include topography run off and run on drainage, flood plains, and location and distance from downstream surface water, wet lands and endangered species.
- Visual inspection, which will involve:
- Conversations with adjoining property owners, maintenance personnel, and other knowledgeable parties;
- Document current land usage, photographs of structures, and operations;
- Photographs of adjoining properties, indicating current usage;
- Identify potential problem areas such as horse farms, poultry farms, dairy farms, illegal dumping of hazardous material, PCB's, land fills, waste water, containers, air emissions, distinct odors, underground/above ground storage tanks.
- Inspect for asbestos. Some of the more common areas for asbestos use is ceiling tile, flooring, pipe and boiler insulation. If asbestos is found, determine if it is damaged or flaking.
- The environmental engineering firm selected by the Real Estate Committee will review regulatory agencies records, which will include:
- Reviewing federal and state environmental agency files, and document any permits or complaints that relate to the subject property or any adjoining property.
- Review local governmental records that have jurisdiction over underground storage tanks, solid waste, drinking water, and septic systems.
- The environmental engineering firm will submit their completed report to the Foundation Real Estate Committee on a timely basis.
- Properties which do not satisfy the standards as established by the Phase I Environmental Site Assessment will be further studied and referred to the Real Estate Committee as necessary prior to further action being taken.
- Properties, which pass the environmental assessment test, will be subject to normal property acceptance guidelines.
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SUBJECT: Oil, Gas and Mineral Leases
PURPOSE: To provide guidelines for negotiating contracts.
GENERAL: The Foundation receives rent and/or royalty payments on various properties, but does not act as an operator for oil and gas wells.
PROCEDURE:
- Primary term of lease - no more than three (3) years.
- Royalty - minimum of one-sixth (1/6) or 16.66%
- Lease Bonus - not less than $50 per acre.
- Delay Rentals - not less than $10 per acre.
- Shut-in Royalties - not less than $10 per acre.
- Establish pooling arrangements to the maximum benefit of the Foundation.
- No option rights on future acreage.
- Inquire as to depth that well will be drilled. Include the following provision to the Lease:
Maximum Depth Provision
It is understood and provided that this lease covers and pertains to the oil, gas and casing head gas and all rights pertaining thereto in the land specifically described above insofar, and only insofar, as such products are produced from strata or formations lying between the surface of the above described property and a Maximum Depth of______ feet. This lease does not cover and include any depths below the Maximum Depth set forth above.
Offset Well Provision
Well must be drilled on lease if successful well is drilled within specified distance of property covered by lease (400' is an example).
Pugh Clause
Production in paying quantities on a portion of the leased premises or lands unitized therewith will extend this lease only to such portion of the leased premises beyond the primary term as may be then included in a producing unit or units; however, this lease shall not terminate if actual drilling operations on any portion of the leased premises, or on lands with which a portion of the leased premises may be unitized, are being conducted at the end of primary term. Such operations shall continue to maintain this lease in force and effect as to all of the above described lands beyond the primary term for so long as actual drilling operations are being conducted with no cessation of more than one hundred eighty (180) consecutive days from the date of completion of one well and the commencement of drilling operations of another well. If operations taking place at or after the expiration of the primary term are discontinued for longer than one hundred eighty (180) consecutive days, then this lease shall remain in force and effect only as to the leased premises then included within a producing unit or units.
- During the lease negotiations, information will be obtained from local knowledgeable parties such as Landmen, Attorneys, and Brokers. In some instances, DO should check the terms and conditions of oil and gas leases that are recorded in local County Clerk's Office.
- Secure a copy of oil field plat illustrating proposed lease acreage and surrounding acreage. Secure information as available on any nearby wells and drilling activity.
- The Primary objective is to ensure that we secure favorable lease terms for the Foundation and accumulate as much information possible about the surrounding lease area and the Lessee.
- Set up payment schedules and place one copy in the donor's file and the original should be placed in the fire proof cabinet.
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SUBJECT: Real Estate Marketing
PURPOSE: To provide guidelines for marketing of real estate held by the Foundation.
GENERAL: Fair market value is defined as the price at which property would transfer between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts.
PROCEDURE:
- A qualified appraisal is required when the donor plans to take a charitable tax deduction and the property is worth more than $5,000.00.
- These appraisals reflect opinions usually based on historical data. The Appraisal may or may not reflect the price at which the property can be sold within a reasonable time.
- Verify the current fair market value. A current market analysis should be obtained from a Real Estate Broker who is marketing similar properties in the area.
- If the market analysis indicates a value that is substantially different than the original appraisal, then the Director of Planned Giving will determine the appropriate marketing price in conjunction with the Real Estate Committee as appropriate.
- A market appraisal/analysis of the property will be conducted annually. All properties valued at $100,000 or more will be submitted to the Real Estate Committee for review and Board approval.
- Mineral rights will be considered for sale as appropriate to the circumstances. Every effort is made to retain mineral rights for future investment opportunities.
- Conveyance will be by Special Warranty Deed.
- Strive for payment in cash.
- If necessary, the Foundation can offer seller financing on the following terms:
- Down payment - 20%-25% range.
- Balance of purchase price will be carried on a note set at the prevailing interest rate that is subject to change as determined by the Board of Directors.
- Monthly, quarterly, or semi-annual principal and interest payments.
- Length of note should be 10 years or less. In some cases, the note payment can be amortized over longer periods than 10 years with a balloon payment due at the end of the note term.
- Secure basic credit information on the buyer and the proposed use of the property.
- The contract will be presented to the Real Estate Committee for approval. If the value of the property exceeds $75,000, the contract will also be presented to the Board of Directors for approval.
- The sales contract must include a provision that ensures that any roll-back tax charges or other similar charges related to the sale and/or changes in property ownership, zoning, platting, development or easements are to be paid 100% by the buyer.
- Appropriate file copies will be made and distributed as required.
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SUBJECT: Farm and Ranch Leases
PURPOSE: To provide guidelines for negotiating and managing surface leases.
GENERAL: Every effort is made to surface lease all rural property with a goal of maximizing the income.
PROCEDURE:
- Inspect the property and be familiar with it. All property will be inspected periodically with a minimum of one inspection per year.
- Determine the best type of lease for the property.
- On farm land, check with local USDA-ASCS and determine amount of base acreage and established yield of different crops for the particular property.
- On pasture land, check with local USDA and Soil Conservation Service (SCS) and document normal pasture stocking rates for the particular property, and if not previously made, ask SCS to prepare a conservation plan for the property.
- Communicate with local banks, Production Credit Association, Federal Land Banks and Realtors to obtain normal types of leases made and average pasture lease rates for the area.
- Check background of Lessee with persons in the area, e.g., ASCS, SCS, and lenders.
- Review the lease form with the Lessee and advise him of the conditions under which he will be operating.
- Have understanding between Lessor/Lessee regarding improvements.
- Lessor will not pay any bills that have not been previously approved by Lessor.
- If Lessor is to pay a portion of expenses for repairs, an inspection of the property will be necessary to make certain Lessee and Lessor are in agreement on what repairs will be shared.
- Lease should be prepared by individual responsible for the property management.
- After approval has been obtained, secure Lessee's signature and forward Lessee a fully executed copy of the Lease.
- Set up payment schedules and place one copy of the lease in the real estate file and the original should be placed in the fire proof cabinet.
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SUBJECT: Procedure for Acceptance of Bequests of Real Estate through a planned gift arrangement
PURPOSE: To establish general procedures for the acceptance, receipt, and documentation of bequests of real estate through the maturation of a planned gift arrangement.
GENERAL: Bequests of real estate must be handled as the completion of a planned gift arrangement in a timely manner
PROCEDURE:
- Normal contact with a donor's personal representative and/or attorney is through the Real Estate Committee and the Executive Director.
- The Foundation should secure independent legal counsel on the ground in the local of the property to assist with proper analysis and possible transfer of the bequest to the Foundation.
- The Real Estate Committee and the Executive Director should confirm the status of the information previously obtained by the DO about the real estate such as:
- Complete legal description or a copy of the donor's warranty deed. If a copy of the deed is not available, determine the date of ownership by the donor, copy of the legal survey, etc.
- Does the Estate have a title policy or an abstract of the property?
- Are there any outstanding liens or indebtedness against the real estate? If so, obtain as much information as possible including copies of note, deed of trust, etc.
- Mineral Status - Are the minerals being conveyed or distributed to other beneficiaries?
- Are there any improvements to the property such as water well, electricity, buildings, fence, improved grasses, ponds, row crops, etc? Any portion of property in a flood plain?
- Tax Status - Have the previous years' taxes been paid?
- Are there any leases affecting the property such as farming, hunting, grazing, oil and gas or rental agreements? If so, obtain a copy of the lease or leases. Are there any easements? Is the property zoned?
- Is the bequest restricted or unrestricted, endowed or non-endowed in a manner different from the existing Memorandum of Understanding?
- What has been the principal use of the property since the donor has owned it. Secure the name of previous owner for follow-up if possible.
- Has the property ever been used in the production, storage, or disposal of toxic material? If there is any possibility of hazardous exposure, document the situation as much as possible.
- Commercial Properties (apartments, duplexes, houses, office buildings, warehouses, etc.) - confirm that this information is already on file:
- Copy of the last three years income tax Schedule E on the subject property.
- Copy of current lease agreements.
- Copy of last three years paid property tax receipts.
- Any other financial information that might be helpful in evaluating this property.
- Prior to accepting transfer of the property, a Phase I Environmental Assessment, or other acceptable environmental liability analysis approved by the Foundation, depending on the type of property, use, location, and history, shall be completed.
- The original Property Evaluation Report and all of this updated information will be circulated to the Real Estate Committee, which will make recommendations on acceptance or disclaimer of the bequest to the Board of Directors of the Foundation.
- If the bequest is accepted by the Foundation, the Executive Director will work with the personal representative(s) and legal counsel to affect the transfer of title.
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SUBJECT: Procedure for Acceptance of Bequests of Real Estate through a spontaneous notification by a representative of an Estate, with no prior planned gift arrangement
PURPOSE: To establish general procedures for the acceptance, receipt, and documentation of bequests of real estate through a spontaneous notification.
GENERAL: Bequests of real estate must be handled as the completion of a planned gift arrangement in a timely manner
PROCEDURE:
- Normal contact with an Estate’s personal representative and/or attorney is through the Real Estate Committee and the Executive Director.
- The Foundation should secure independent legal counsel to assist with proper analysis and possible transfer of the bequest to the Foundation; proceeds from the bequest will pay all direct expenses associated with acceptance of the bequest. Exact timeliness and responsibilities regarding acceptance and/or disclaimer of the bequest must be identified and communicated to the Foundation Board of Directors within sixty (60) days of notification of the bequest by representatives of the Estate.
- The Real Estate Committee and the Executive Director should obtain as much information as possible about the bequest, such as:
- Copy of the complete Will, inventory and appraisal of property from personal representative.
- Complete legal description or a copy of the donor's warranty deed. If a copy of the deed is not available, determine the date of ownership by the donor, copy of the legal survey, etc.
- Does the Estate have a title policy or an abstract of the property?
- Are there any outstanding liens or indebtedness against the real estate? If so, obtain as much information as possible including copies of note, deed of trust, etc.
- Mineral Status - Are the minerals being conveyed or distributed to other beneficiaries? If minerals are being conveyed, how much do they own?
- Are there any improvements to the property such as water well, electricity, buildings, fence, improved grasses, ponds, row crops, etc? Any portion of property in a flood plain?
- Tax Status - Have the previous years' taxes been paid?
- Are there any leases affecting the property such as farming, hunting, grazing, oil and gas or rental agreements? If so, obtain a copy of the lease or leases. Are there any easements? Is the property zoned?
- Is the gift restricted or unrestricted, endowed or non-endowed? Do any restrictions comply with Foundation Gift Acceptance Policies and appropriate UNT policies?
- What has been the principal use of the property since the donor has owned it? Secure the name of previous owner for follow-up if possible.
- Has the property ever been used in the production, storage, or disposal of toxic material? If there is any possibility of hazardous exposure, document the situation as much as possible.
- Commercial Properties (apartments, duplexes, houses, office buildings, warehouses, etc.) - the Estate will be asked to furnish the following information:
- Copy of the last three years income tax Schedule E on the subject property.
- Copy of current lease agreements.
- Copy of last three years paid property tax receipts.
- Any other financial information that might be helpful in evaluating this property.
- The Executive Director will inform the personal representative of the Estate that the above gathered information will be given to the Foundation's Real Estate Committee, the property will be analyzed, and the Executive Director will be back in touch with the personal representative regarding the Foundation’s decision regarding accepting or disclaiming the bequest.
- The Real Estate Committee and the Executive Director will be responsible for preparing a thorough report on the property for Foundation Board consideration. In addition, the report will include an appraisal value, if available, and a comment on the current market for the type property being considered.
- Gifts of real estate are acceptable only after it has been determined that no reasonable possibility exists that the property is contaminated with toxic waste. If potential for toxic waste has been indicated, that property, if ultimately accepted by the Foundation, must be accepted by a different entity such as a Limited Liability Corporation or an irrevocable and perpetual trust or series of trusts, as opposed to accepting the property in an endowment fund, regardless of whether or not a licensed toxic waste inspector indicates that the property is not contaminated. No exceptions may be made. The expense of the inspection will be borne by the bequest unless an exception is approved by the Foundation.
- The Property Evaluation Report will be circulated, and the Chairman of the Real Estate Committee, Director of Planned Giving, DO, and Vice President for Development will make recommendations on acceptance of the gift to the Chairman.
- If the bequest is accepted by the Foundation, the Executive Director will work with the personal representative(s) and legal counsel to affect the transfer of title.
- If the bequest is not accepted by the Foundation, the Executive Director will work with legal counsel to file the appropriate disclaimer papers in a timely manner.
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