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ERIC Number: EJ788936
Record Type: Journal
Publication Date: 2008-Feb-22
Pages: 1
Abstractor: ERIC
Reference Count: 0
ISSN: ISSN-0009-5982
More Money Doesn't Have to Mean More Problems
White, Lawrence
Chronicle of Higher Education, v54 n24 pA29 Feb 2008
A gasp-provoking amount of money will be donated and bequeathed to the nation's colleges over the next two generations. The total amount of college endowments is about $411.2-billion, according to the National Association of College and University Business Officers, and it can be expected to double, if not triple, in size over the next several decades. With such large sums of money coming in, it is a safe bet that lawsuits, recrimination, finger-pointing, and public posturing will not lag far behind. This has already taken form in recent years in high-profile and big-money disputes between donors or their descendants and the colleges that thought they were the beneficiaries of charitable largess. Lawsuits go in both directions. Donors sue when they think colleges have ignored gift restrictions, mismanaged funds, or used donations for unintended purposes. Colleges sue donors for failing to honor pledges, reneging on promised gifts, and micromanaging how donated funds are used. A former general counsel of a large university with an active planned-giving department, the writer maintains that there is no empirical evidence to suggest that development offices are exhibiting a pattern of deliberately ignoring restrictions in negotiated gift agreements, and offers five points for colleges to minimize the likelihood of acrimonious feuds with donors and potential donors: (1) Development offices should have access to experienced lawyers who can help negotiate gift agreements; (2) Fund-raising professionals must budget ample time for regular discussions with donors and prospective donors; (3) Institutions should make sure they approach negotiations with donors in an organized fashion; (4) Institutions should learn a basic lesson from the experiences of other colleges that have had to deal with litigious donors or their descendants: the most sensitive moment in the life of any gift is when the recipient uses or is tempted to use the gift for purposes not clearly outlined in the gift agreement; and (5) Institutions need to know when to say no. Colleges should approach gift agreements with integrity, attention to ethical standards, and sensitivity to the desires of donors. They should take comfort from the fact that disagreements with donors are exceptionally rare. It is also comforting to know that, when disagreements arise, donors who sue do not often win. It is sobering to remember that when donors sue, lawyers are usually the biggest victors.
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Publication Type: Journal Articles; Reports - Descriptive
Education Level: Higher Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A