KCD
Also DIBA
GIFT AND TRUST FUND MANAGEMENT
I. Purpose:
The purpose of this policy is to establish guidelines for oversight, including, but not limited to, acceptance, distribution, investment and records management, of gifts and trusts.
II. Definitions:
A. Gifts
Any donation, grant, bequest, contribution or endowment given or transferred to the District or any entity of the District. If such gift falls under the parameters of a trust as defined below it shall hereinafter be referred to as a Trust.
B. Trusts
1. District Trusts
a. Unrestricted
Monetary funds owned by the District and over which the District has absolute control but have stipulations, either by donor intent or School Committee vote, to establish a principal which remains wholly or partially undisbursed for the purpose of providing a source of fund revenue that continues for more than a single fiscal year.
Under Government Accounting Standards Board Statement 34 (GASB 34) this fund type is defined as a Private Purpose Fund (fully expendable).
b. Restricted
Monetary funds owned by the District over which the District has restricted discretion, by donor stipulation, with regard to investment and/or distribution. The funds have a principal which remains wholly or partially undisbursed for the purpose of providing a source of fund revenue that continues for more than a single fiscal year.
Under Government Accounting Standards Board Statement 34 (GASB 34) this fund type is defined as a Permanent Fund (non-expendable).
2. External Trusts
Monetary funds not owned and/or managed by the District; however, by donor stipulation, provide specified disbursements at prescribed or implied intervals to or through the District.
External Trusts are subject solely to §IV - Acceptance of this policy.
C. Trustee
Trustees of District Trust Funds are the custodian of the District's perpetual care funds, charitable (scholarship) trusts, and capital reserve/expendable trust funds as well as any other District Fund managed under terms or conditions requiring a Trustee.
III. Management: Investment Subcommittee
In accordance with §7.1 of the AWRSD Bylaws, a Standing Subcommittee of the School Committee, “The Investment Subcommittee,” is hereby established.
Scope of Responsibility:
The Investment Subcommittee is charged with overall administration and enforcement of this policy “Gift and Trust Fund Management.”
Specific Duties:
The Investment Subcommittee
· will ensure, in consultation with the Director of Finance and Business Operations and District Treasurer, all District funds, including District Trusts, qualifying under §VI Investment of this policy are appropriately managed with the goal of maximizing investment revenue.
· shall perform the duties of Trustee in all District matters requiring such designation.
· has the ongoing responsibility of ensuring compliance with this policy and recommending revisions to this policy as warranted.
Authority:
The Investment Subcommittee
· is authorized to act in the capacity of “Trustee.”
· has authority to ensure that all terms of this policy are effectuated in a timely and responsible manner.
· has authority to engage professional services, subject to School Committee approval, for the purpose of securing advice with regard to investment of district funds.
The Chairperson, Vice Chairperson and Secretary shall provide guidance should any question of authority arise.
IV. Acceptance
All gifts and trusts must be officially accepted by the Ashburnham-Westminster Regional School Committee and thereafter (with the exception of external trusts) become the property of the Ashburnham-Westminster Regional School District. A letter, in addition to other appropriate legal documents, from the donor, should accompany all gifts and trusts presented to the District so that the School Committee can make proper recognition.
To be acceptable, a gift or trust
Must be able to be used for a purpose consistent with the policies, procedures and culture of the School District.
Must be offered by a donor acceptable to the School Committee.
Must not result in unreasonable demands being made on the staff.
Must not result in any hidden costs to the School District.
Must not be in conflict with Massachusetts General Law, Department of Elementary and Secondary Education Regulation or School Committee policy nor should the acceptance of a gift or trust imply an endorsement of any business, product or service.
Should not contain stipulations that, in the view of the School Committee, could invalidate the terms of the gift or trust at some future date. (see §VIII Miscellaneous ¶3 of this policy)
V. Distribution
The School Committee, on recommendation of District Administration, shall vote on the frequency and distribution of District Unrestricted Trusts and any Gift or District Restricted Trust having no definitive designation with regard to distribution.
Where award discretion for perpetual disbursement trusts is permitted, the Investment Subcommittee should recommend amounts that will allow for modest growth of principal (see §VII Records Management ¶6.a. of this policy).
VI. Investment
Notwithstanding any statute or rule of law to the contrary, Trustees of District Trust funds may establish, maintain and operate one or more common trust funds, in which may be combined money and property belonging to the various trusts in their care, for the purpose of facilitating investments, providing diversification and obtaining reasonable income. Where appropriate, possession of all, or a portion thereof, District Trust funds will be transferred to these funding agencies (as defined in the following paragraphs) as soon as feasible for professional management as recommended by the District Treasurer subject to approval by the Investment Subcommittee. The School Committee may request quarterly financial data on these funds.
As provided by M.G.L. c 167 §15A, not later than July first, the Commissioner of Banks of the Commonwealth shall prepare a list of all stocks, bonds, notes and other interest-bearing obligations which are then legal investments.
Bank accounts, Certificates of Deposit, Term Deposits, Repurchase Agreements of U.S. Securities, U.S. Treasury of Federal Agency obligations and Massachusetts Municipal Depository Trust are all available as investment instruments. Investment in money market accounts is also allowed.
Nothing in this policy shall preclude the inclusion of other eligible District funds from participating in the investment pooling described in this section.
·Gift, Trust and other District funds not participating in the investment pooling described above should be deposited into interest bearing financial instruments that meet state and federal laws. These include Trust Companies, National Banks, Savings Banks, Banking Companies or Cooperative Banks. Credit Unions and Loan Associations are not permitted.
VII. Records Management
The Ashburnham-Westminster Regional School District will maintain a permanent file, under the supervision of the Business Office, for each trust sustained by the District.
This permanent file will be updated annually, or more often if warranted, for all District Trusts using an appropriate format that records the following:
(* indicates this item is required –other items, although not required, should be solicited if not provided)
* Name of Donor
Anonymous gifts will be initially handled by vote of the School Committee as to whether they are treated as a Gift or District Trust. (For purposes of this file the School Committee as a whole is the donor unless the full committee desires some other recognition for anonymous Trusts.)
Donor Information / Directives
a. Reason for Trust / General Purpose of the Trust
b. Information to be “advertised” at each presentation/disbursement
Name of Scholarship or Trust Fund (to be advertised at awards ceremonies, news releases, etc.)
If no name is given the Administration may use its discretion as to how it is identified.
* Amount and date of Original Trust
Trust Augmentation (excluding interest, if anticipated, how will it occur)
* Trust Specifications:
a. Amount to be distributed (interest only, specific amount, percentage), frequency and timeframe (graduation, awards night, start of fiscal year, etc.)
Note: If the original intent implies a perpetual disbursement, care should be taken to ensure the ongoing viability of the Trust, including consideration for growth of principal.
b. Recipient Eligibility / Selection Criteria
Items to Include:
For an individual
i. Individual Characteristics
ii. Academic Record
iii. Need
iv. Type of Educational Institution
v. Course of Study
vi. Selection Process
For other purpose:
i. Specific criteria: School, Building, Department, Program, etc.
ii. Use intent: Books, Maintenance, Enrichment, Augment, supplant existing budget, etc.
Legal Documents
a. * Trust Specifications (documents that elucidate the terms)
b. Legal Counsel Approval (if required)
* Oversight
For an Individual
a. The person(s) or office charged with recipient selection.
b. The date and reference to the actual disbursement of funds.
The recipient may be required to furnish proof that the Scholarship was used for its intended purpose (copy of canceled check, book store receipt, etc.).
For other purpose
a. The date(s) on which funds were transferred and the authorizing individual.
b. Reference to where the funds were transferred and actually expended.
* Balance Sheet: Expenditures, Investment/Interest Earnings, Balance
Pooled funds must clearly show separate accounting for each Trust/fund.
Note: For each Trust/fund, if documented in the District Annual Budget Report, a reference to that effect may be substituted, however the history must be maintained.
VIII. Miscellaneous
Gifts intended for one time distribution and gifts wholly distributed in the same fiscal year as received are exempt from §VII- Records Management of this policy.
The Investment Subcommittee will audit the file (§VII-Records Management) at intervals the Investment Subcommittee deems appropriate, but at least annually.
Should the District, through changing conditions, lose its authority to manage a District Trust fund as originally intended, the District shall first attempt to have the terms of the Trust revised (consulting with legal counsel about invoking the cy-près doctrine is advised) and, if failing that, attempt to divest itself of the Trust as soon as feasible.
Note: The Attorney General of the Commonwealth has power over the enforcement of a charitable trust.
The Business Office and the School Committee Investment Subcommittee are charged with review of this policy and to recommend revisions as necessary.
LEGAL REF: M.G.L. c. 71 §37A
MISC. REF: Massachusetts Municipal Collectors and Treasurers Association Handbook, c 6 “Trust Funds, Grants and other Special Funds” as revised 2009
CROSS REF: BDCA Appointed Committee Officials - Treasurer
This policy (§III Management: Investment Subcommittee) fulfills the requirements of the Ashburnham-Westminster Regional School Committee Bylaws, §7.1.2, specifying Scope of Responsibility, Specific Duties and Authority of the Investment Subcommittee.
First Reading: 1/20/15 Second Reading: 2/10/15 Adopted: 2/24/15