The purpose of this policy is to clarify how EMU fundraising priorities are established, lines of authority in making fundraising decisions, and the process for ensuring that all fundraising activities on behalf of EMU and its various divisions are conducted in a manner consistent with IRS regulations and meet these operating standards: a) employ appropriate fundraising strategies, b) avoid unnecessary overlap or duplication of fundraising activities, and c) effectively coordinate contact with external donor constituencies.
Under the direction of the president of EMU, and the vice president for advancement as her/his designee, all fundraising for the university and its divisions is coordinated through the development office. (The development office is part of the advancement division.) Fundraising priorities are derived from EMU’s board-approved strategic plan to attract ongoing philanthropic support for the institution and for special projects deemed to be strategic in nature. There are occasions when personnel in divisions other than advancement desire to initiate fundraising on behalf of a special project. In these instances, it is required that the project be approved in advance by the head of the relevant division, and then carefully coordinated with the development office. In addition, there may be faculty or other personnel who occasionally initiate grant proposals to foundations or government agencies. The development office must be advised in advance of preparation of grant proposals to insure that no overlap occurs with funding agencies, and to assure that a plan is in place for the receipt and monitoring of grant funds. In the event of conflicts between parties concerning funding sources, timing of fundraising activities, etc, the vice president for advancement will facilitate a solution with the appropriate parties.
- The University Fund – The University Fund is the top fundraising priority for EMU. Contributions to this annual operating fund supplement financial aid for students as well as provide general operating support for EMU’s various programs. The development office conducts a variety of fundraising activities (appeals, phonathons, donor visits, alumni communications, etc.) to seek continuously increasing sums in support of this vital funding stream for the university and its programs.
- Planned Giving – To ensure the long term viability of EMU, the institution places a priority upon the cultivation of estate gifts from EMU’s constituency of alumni and donor friends. These gifts are often referred to as “bequests” or “planned gifts” and, in most cases, come to the university through the estates of donors after they have passed away. Gifts of this nature are often added to EMU’s endowment fund to provide ongoing program support or scholarships for students.
- Capital Campaigns – From time to time, and with oversight of EMU’s president and the board of trustees, EMU undertakes a concerted effort to raise extraordinary contributions from its donor and alumni constituencies to fund strategic priorities for the institution. These fundraising campaigns (sometimes referred to as “capital” or “comprehensive” campaigns) generally seek major financial commitments that may extend for several years. The focus of these campaigns often includes capital projects, such as constructing new or renovating existing buildings, as well as the establishment of endowment funds to provide permanent support for the university and its programs. The vice president for advancement, as designated by the president, may serve as the director of the school’s capital campaigns.
- Program-Specific Projects* & Grant Opportunities– Occasionally, there are EMU personnel who initiate fundraising activities to generate revenues in support of special projects in their departments that are not fully funded in their annual operating budgets. This includes foundation and government grant opportunities that often come to the attention of faculty. As noted in the policy statement above, it is required that such initiatives be carefully coordinated with EMU’s development office prior to conducting the fundraising activity or initiating the proposal process mainly to ensure no overlap with other departments. Note the following required action steps that help facilitate a smooth process in fundraising or grant preparation for special projects:
a) Department chair or project sponsor presents fundraising request (including purpose, budget, intended funding source or donor audience, amount, timeline, etc.) to the dean or vice president to whom s/he is responsible. It is very important that before the project is approved, careful consideration is given to the required budget for the project, and whether there are any implications for the institution’s budget if the project is ultimately funded, in part or in full.
b) If approved, the dean or vice president communicates approval in writing to the vice president for advancement including any additional instructions or clarification that may be appropriate (i.e. the level of priority, etc.). At this point, the vice president for advancement will review the proposal with the executive director of development and grants coordinator in the development office to sign off on the fundraising or proposal plan, and to confirm there are no conflicts of interest.
c) If the fundraising or proposal plan is approved by the vice president for advancement, the development office may assist with certain aspects of the fundraising activity or proposal being planned in collaboration with the department making the request. If it is a grant proposal, the faculty member or project sponsor may contact the foundation as planned, and should also forward a copy of the grant proposal, budget, and notification regarding a denial or award to the grants coordinator in the development office for tracking purposes. The development office will also assist with proper receipting and acknowledgment of contributions.
5. Student Projects – Students or student organizations may occasionally raise funds for activities initiated, organized and/or sponsored by students. Approval for such projects must be secured from the vice president for student life and the Student Government Association (SGA). In instances where students propose a fundraising project that requires the support of any EMU constituency beyond the student body, approval must be secured in advance from the executive director of development.
6. Social Responsibility – Consistent with EMU’s investment policy for endowment funds, EMU seeks institutional funding from foundations that do not derive a significant percentage of their assets from corporations that manufacture military goods or which collaborate significantly with military operations. The same applies to companies that make tobacco or alcohol products. If a funding source that does not meet this criteria desires to make a contribution or grant to EMU, consideration will be given by the president prior to accepting or rejecting the contribution.
7. Purchase of a Chance – The IRS has special reporting requirements for “gaming activities” including bingo, raffles, scratch offs, casino nights, etc. Fundraising strategies which include the purchase of a “chance,” as in the case of raffles and other gaming activities are not permissible.
8. Quid Pro Quo Contributions – A quid pro quo contribution is a payment to a charity that is partly a contribution and partly for goods or services. For example, if a donor gives a charity $100 and receives a concert ticket valued at $40, the donor has made a quid pro quo contribution. In this example, the charitable contribution is $60. If the donor’s payment to the organization is more than $75, the organization must provide a disclosure statement to the donor either in connection with the solicitation or the receipt of the payment. This also applies to advertizing: commitments made by individuals, businesses, etc., for advertizing space in event programs do not qualify to receive a charitable gift receipt unless the value of the commitment exceeds the value of the benefit. In this case, only the amount above and beyond the value of the benefit qualifies as a charitable deduction. Failure to provide the required statement may result in a penalty of $10 per contribution. (See Internal Revenue Service Procedures 90-12 and 92-49.)
9. Special fundraising events – Fundraising events require special reporting to the IRS on the University’s annual Form 990 report. The IRS defines fundraising events as “dinners/dances, door-to-door sales of merchandise, concerts, carnivals, sports events, auctions, and casino nights that are not regularly carried on. Fundraising events do not include sales of gifts or goods or services of only nominal value, sweepstakes, lotteries or raffles where the names of contributors or other respondents are entered in a drawing for prizes, raffle or lotteries where prizes have only nominal value or solicitation campaigns that generate only contributions.” Any University department or program using fundraising events must provide a financial report for the event promptly after the event with the information required for Schedule G of Form 990, i.e., gross receipts (excluding contributions), charitable contributions, expenses (i.e., cash prizes, non-cash prizes, rent/facility costs, and other direct expenses). The report should be filed with the vice president for finance and with the development office.
The vice president for advancement is responsible for this policy. Development staff assist with the administration of fundraising policies and procedures.
This policy is to be reviewed every two years.
Approved by President’s Cabinet, February 18, 2009
Reviewed by VP for Advancement, January 16, 2019
* Note: Examples of program-specific projects include, but are not limited to, EMU booster clubs like Loyal Royals, Haverim, Encore, as well as special programs such as Bach Festival and Shenandoah Valley Children’s Choir.