Authority: Wright State University Board of Trustee Resolution 98-26 (December 5, 1997); Vice President for University Advancement
Wright Way Policy
3702 Quasi-Endowment Fund | Wright Way Policy
3702.1 General Policy
To help support Wright State University's continuing efforts to achieve its mission, external donors may provide gifts to the university. The donor may impose no restrictions on the gift whereby the gift may be used for any university purpose (an unrestricted gift), or the donor may restrict the gift to be used only for a specific department, activity, or project (a restricted gift). One method of giving is to establish an "endowment," which is a gift whereby the donor stipulates, as a condition of the gift, that the principal be maintained for a specified period of time or until an event occurs or that the principal be maintained in perpetuity. The funds are invested for the purpose of producing present and future income which may either be expended currently or added to the principal. The Wright State University Foundation, Inc., has the responsibility to receive gifts and maintain accountability for them.
3702.2 Quasi-Endowment Funds
Wright State University may make internal decisions to allocate and designate funds as quasi-endowment funds, in order to achieve the institution's initiatives and to serve the needs of its students. A quasi-endowment functions in the same manner as an endowment except that a quasi-endowment is created by the university rather than by an external donor. Therefore, it is the discretion of the Board of Trustees to expend the principal of a quasi-endowment or to continue the existence of a quasi-endowment.
Quasi-endowments are to be maintained within the university and are to be maintained separately from Wright State University Foundation accounts which are funded by external gifts only. The following procedures govern establishment, maintenance, and termination of a quasi-endowment fund.
Creation of a quasi-endowment fund may be recommended by a university unit to the provost or appropriate vice president. The provost or appropriate vice president will then submit the recommendation to the President's Cabinet for approval. Once approved by the President's Cabinet, the recommendation for a quasi-endowment fund will be submitted to the Finance and Audit Committee of the Board of Trustees and ultimately to the full Board for approval.
The submitting unit must include as part of a recommendation a description of the quasi-endowment, including the purpose of the fund, how it relates to the university's mission, and an identification of the source of funds for establishing the quasi-endowment. The funds for establishing the quasi-endowment are to be cash balances and not base budgets. The minimum amount necessary to establish a fund is $50,000.
The quasi-endowment will be accounted for in the university's endowment fund and accordingly be subject to the disbursement policies and investment guidelines in place for those funds. In addition, no endowment principal may be expended without approval by the Board of Trustees.
Upon approval, the Office of Financial Services will create an account number in the endowment fund for the quasi-endowment. In order to expend annual earnings, the responsible unit must identify the operating account number. Any questions regarding an appropriate account from which to expend funds should be directed to the Office of Financial Services.
Establishment of a quasi-endowment will be considered permanent. Therefore, a request to terminate or discontinue a quasi-endowment and a subsequent transfer of funds to general university funds is subject to the same approval process described in paragraph 1) above, including approval by the Board of Trustees.