Powell Fund Match Program Policies and Procedures Memo
This memo is intended to summarize the high-level financial policies and procedures of the Powell Fund Match (PFM) program at University of the Pacific. It is a consolidation and refinement of previous work on the topic and is intended to outline how the PFM program will impact the University's and units' annual budgets and how the program will operate in broad terms. The memo will cover eligibility, principles of each dimension of the program, i.e., scholarship match originally funded at $57M and academic program match funded at $25M, as well as operating procedures and reporting to Powell Advisors. These policies and procedures are all consistent with the Powell Gift Agreement.
Gifts are eligible for the Powell Fund Match if they are new gifts of $50,000 or more that establish a new endowment or expand an existing one. New gifts are defined as those that the pledge and/or gift was made on October 1, 2012, or after. Gifts of cash, stock or other assets, including pledges of up to 5 years in length, qualify for 1:1 matching so long as the assets can be liquidated within a 5-year period. Corporate matching gifts may count toward minimum eligibility as long as donors take responsibility for making up the difference if the corporate matching gift is not received within the time of the pledge.
For the purposes of this program, a donor is defined as an individual or couple, a group of individuals, a family foundation, or any other defined individuals or entity establishing the single endowment of $50,000 or more.
The Powell Fund Match is made available after a gift or total payments received toward a pledge total at least $50,000.
Revocable estate gifts do not qualify for matching. However, deferred gifts will be considered for matching at a 0.5:1 ratio (i.e., a 50% match) under the following guidelines:
All commitments eligible for the Powell Fund Match will be documented using a gift agreement.
Endowed Scholarship Match: Basic Principles
Eligible Endowed Scholarships
Only conforming scholarships are to be considered for a match. Conforming scholarships are defined as merit and/or need-based scholarships that may recognize academics and/or performance-based merits of the student; they are administered by financial aid, or awarded by X (School/Unit) and administered by financial aid, and are in compliance with all applicable Federal and State regulations.
Non-conforming scholarships will not be matched as they can put Pacific in risk of violating Federal and/or State regulations.
Impact of Matched Scholarship
To further the enrollment management strategies of the University, Powell Matched Scholarships will be awarded as 100% extra financial aid to the recipient. The Powell matched portion is also awarded as extra, e.g., minimum scholarship at $50K with $50K match awards approximately $4,000 in extra scholarships.
Existing endowed scholarships that are enhanced by a Powell Match will also be awarded as 100% extra financial aid to the recipients even if prior to being matched the scholarships had been awarded as replacement financial aid.
Allocation of Match Funds
Each school will be allocated a baseline of $4,000,000 and the College will be allocated $5,000,000 of the Powell Fund for matching of new endowed scholarship gifts to establish or enhance conforming scholarships. Athletics will also be allocated $4,000,000 and the Brubeck Institute will receive a $2,000,000 allocation.
These amounts will be divided into two tranches as scholarship matching initiatives are worked into the campaign plan. At the end of the first tranche of funds period if units still have funds available that these funds be allocated to the Reserve pool, allowing the University to provide the most strategic allocations as opportunities arise.
The Arthur A. Dugoni School of Dentistry's allocation of matching funds will be reserved and will be available at a later date, allowing the School to be able to complete its new building fundraising initiative before focusing on the match program.
University-wide endowed scholarships will be promoted so that the students who most need, and deserve scholarships, have access to them regardless of the school in which they are enrolled.
These allocations are summarized in the table that follows. [Note that the amount used in this table ($57,152,470) is the original gift value; we expect it to be increased to more than $60M by 2017.]
Allocations of Powell Scholarship Match Funds
Endowed Academic Program Match: Basic Principles
Eligible Academic Program Endowments
As the Office of the Provost oversees all University academic units, any academic program endowments to be considered for matching through the Powell Match program will support the operations in this Division. The Provost is responsible for retaining Pacific's high academic and research standards and new (or enhanced) endowments in this area will strengthen the Academic Division in fulfilling its priorities:
1) Strive for excellence in all that we do
2) Develop well rounded and successful students
3) Promote a vibrant academic environment
4) Be relevant to students
5) Enhance sustainable revenue streams
The College, schools and units of the Academic Division are welcome to propose endowments to be matched, especially if the endowments augment its mission to provide the highest quality academic learning experiences for Pacific students and promote a vibrant academic environment consistent with strategic plans found in Pacific 2020.
While units outside of the Academic Division such as athletics and student life enhance the student learning experience, in order to propose endowments to be matched, these units will need to have an academic unit within the Academic Division collaborate on proposals in order to be considered.
As stipulated in Exhibit A of the Powell Agreement, the following endowments supporting faculty will be considered for matching if at least one-half the minimum gift level to establish them are given by the donor(s): Endowed Chair ($2M minimum); Endowed Professorship ($1M minimum); Endowed Fellowship ($500,000 minimum): and Endowed Lectureship ($250,000 minimum).
Exhibit A also mentions as examples of academic program endowments that may be considered for matching: naming an academic program, or endowing student learning opportunities such as academic competitions, a lecture series, or experiential learning programs.
Professional schools, also by nature of their academic programs, offer unique additional opportunities such as endowing clinic programs, professional presentations and hands-on learning experiences that are directly connected to the curriculum.
All academic program endowment matches must go through an approval process before being offered to donors. Proposals will be reviewed and either approved or disapproved within a week of submission by the Provost and/or her assignee and Dean (if applicable) and need to include the following information:
1. How does the endowment support the Academic Division's priorities and/or strategic plan?
2. Define the purpose and impact of the endowment.
3. Detail of proposed funding sources – name(s) and proposed ask amount.
4. Detail the timeline of the pledge expected to establish (enhance) the endowment.
Final approval will be issued by the Vice President for Development for matches less than $500,000 and by the President for matches of $500,000 or more.
Impact of Matched Academic Program Endowment
When an academic program endowment is established, it will enhance the unit's budget. For example, an endowed chair position should be presented to a distinguished faculty member, not to assist in paying salary line as one should already be in place in the operating budget, but to enhance that individual's research and academic opportunities, or to enhance or retain talented faculty.
The budget authority for the endowment will be consistent with current policy on authority of academic program expenditures.
To allow for strategic allocations, like interdisciplinary programs, $5,000,000 is to be allocated to a Reserve pool, $2,250,000 be allocated to each school and $3,250,000 to the College, and $1,000,000 available for the library.
These funds will be available in tranches (with exceptions for prior agreements or proposals in place) based on institutional priorities and progress in the fundraising campaign, with a minimum of 50% of the funds available in the first tranche. [Having Dugoni's allocation of matching funds reserved will allow them to be able to complete their new building fundraising initiative before focusing on the match program.] At the end of the first tranche of funds period, if units still have funds available, these funds will be allocated to the Reserve pool, allowing the University to provide the most strategic allocations as opportunities arise, such as when new academic programs are approved.
Allocations of Powell Academic Program Match Funds
To be most effective and efficient in administering the Powell Fund Match program at Pacific, the Vice President for Development and Alumni Relations and the Vice President for Business and Finance will each appoint an individual in their respective offices to be the lead administrator for the Powell Fund Match program. The assistant vice president for advancement operations (Scott Rivinius) has been identified as the lead for Development and the assistant vice president/chief investment officer (Bayani "Jol" Manilay) has been identified for Finance.
These staff members are authorized to oversee their division's responsibilities in allocating, tracking and reporting on the program's status as it moves forward. Their strategic partnership is needed to communicate to internal and external constituents, including Powell Advisors, how match Powell Match Funds are designated, as well as the balance available for the different schools and units as funds are utilized.
When a gift qualifies for a match, allocations of matching funds to the proper endowment account will be done quarterly (as of March 31; June 30; September 30; and December 31). The number of endowment units allocated will be based on the unit value from the prior quarter, e.g., if $50,000 bought twenty (20) endowment units on March 31 and a donor makes an eligible gift of $50,000 in April, twenty (20) endowment units will be allocated on June 30 for the April gift.
Once a donor has surpassed the minimum amount to establish an endowment or add to an existing endowment, each gift above and beyond that minimum will be matched in the quarter the gift is received. For example, if a donor makes a $100,000 pledge to an endowed scholarship that is payable in five $20,000 installments, the initial match will be allocated after the third payment on the pledge is made, for a cumulative total of a $60,000 match; for the next two years after that, a $20,000 match will be allocated in the quarter the fourth and fifth pledge payments are made.
The Treasury Office is tracking the Powell Fund Match endowment and its designations using the same method it does with the general endowment pool, using Fundriver and Banner. However, the general endowment and Powell fund pools are to be invested separately as outlined in the Powell Agreement.
The donor-funded endowment gifts that qualify for a match will be invested in the University's general endowment pool and the Powell Fund Match will be invested in the separate Powell Fund pool. Each Powell Match Gift Agreement includes the following to inform the donor: "While the Powell Gift Agreement requires the University to keep the match portion of the endowment invested separately from the University's endowment pool, for annual reporting purposes the combined endowments will be presented together."
A memo has been prepared by the President that summarizes how the distributions from the Powell Fund Match program will be utilized during the time that matching funds have not yet been identified. It is attached as Appendix A.
Reporting to Powell Advisors
A Quarterly Powell Fund Match Programs Report has been developed and reviewed at the April 2014 Powell Advisors meeting. It was approved and is expected to be distributed on a quarterly basis to the Powell Advisors. The template for this report on both the Powell Fund Scholarship and Academic Program Matches includes information on matches that have been offered, committed and funded. The Quarterly Report template with information as of June 30, 2014 is attached as Appendix B.
In addition, an Annual Powell Fund Impact Report will be prepared. This stewardship report will include information on endowed academic program and scholarship match activity, including annual data on matches offered, committed and funded, as well as information on the use of unmatched Powell Fund distributions. It will be comprehensive report of all Powell Fund endowment activity, including information on Powell Scholars program activities, including Director's report, i.e., student recipient demographic data, program budget and expenses, and activities; and use of art endowment.