51±¾É«

This online version is for convenience; the official version of this policy is housed in the University Secretariat. In case of discrepancy between the online version and the official version held by the Secretariat, the official version shall prevail.

Approving Authority: Vice President: Advancement & External Relations

Original Approval Date: April 28, 2011

Date of Most Recent Review/Revision: October 8, 2019

Administrative Responsibility: Office of Advancement Services

Parent Policy: 13.6 Gift Acceptance Policy

1. Gift Agreement Guidelines

1.1. A gift agreement between the donor and the university (or approved written documentation in accordance with these guidelines) is required:

1.1.1. For all gifts which dictate the creation of a unique designated donor fund

1.1.2. For all gifts in kind

1.1.3. For all pledges involving multi-year commitments

1.1.4. For all gifts that include naming or other commitments from the University to the donor beyond Development standard stewardship established at relevant giving levels

1.1.5. In cases when a singular gift is directed to an existing designated donor fund (pooled with other gifts), a gift agreement may not be required but is recommended for gifts valued at $10,000 and above.

2. Approval

2.1. In all cases, 51±¾É« faculty and staff responsible for the spending of gifts will be involved in the drafting and approval of gift agreement terms prior to final signatures. Correspondence will be kept on file of these approvals for the lifetime of the gift.

2.2. All gifts that meet the criteria set forth in 4.02.01 of Policy 13.6, Gift Acceptance Policy will be brought forward to the Development Committee of the Board for approval.

2.3. The following signatures are required for all gift agreements with the University:

2.3.1. Vice-President: Advancement & External Relations

2.3.2. Director: Advancement Services

2.3.3. In cases when one of the above signatories are unavailable, the Assistant Vice-President: Alumni & Community Engagement can serve as signatory.

2.3.4. The President & Vice-Chancellor signs gift agreements valued at $1,000,000 and above.

2.3.5. In rare circumstances, where the nature of the gift recommends additional signatories due to a unique impact, such signatories can be added at the discretion of the Vice President: Advancement & External Relations.

3. Guideline for Acceptance of Gifts

3.1. 51±¾É« is a registered charity and complies with all requirements of the Income Tax Act, regulations, publications and guidance from the Canada Revenue Agency (“CRA”).

3.1.1. If at any time there is a conflict between CRA requirements and this procedure, CRA requirements will supersede this procedure.

3.2. Tax Receipting

3.2.1. Advancement and External Relations, in particular Advancement Services, will record all donations to the University and issues donation receipts on behalf of the University.

3.2.2. All tax receipts will be issued in accordance with CRA requirements and guidance.

3.2.3. For pledges, gifts are receipted for payments made as they are received.

3.3. Donor Involvement

3.3.1. In order for a gift to be valid at law, the donor cannot receive any consideration for the transfer of property (or such advantage must be removed from the donation). Accordingly, it is important to ensure that the donor does not retain control or possession of the gift once it is given to the intended recipient. Without limiting the foregoing, no donation should:

3.3.1.1. Interfere with academic freedom

3.3.1.2. Be contingent on the hiring of a particular faculty or staff member

3.3.1.3. Allow the donor to make ongoing decisions about how and where money will be spent (beyond donor restrictions with regard to the specific charitable purpose established at the time of gift)

3.3.1.4. Allow the donor to make hiring decisions

3.3.1.5. Allow the donor to make academic decisions – advisory committees which provide input but do not make decisions about academic direction are permissible

3.3.1.6. Allow the donor to choose a specific beneficiary for their gift (such as a scholarship recipient)

3.3.1.7. Be designated to any program that would provide a benefit to the donor or to anyone not at arm’s length from the donor

3.3.2. 51±¾É« does not accept or administer Donor Advised Funds.

3.3.3. Per CRA, the following transactions do not qualify as gifts:

3.3.3.1. Gifts of services (time or labour)

3.3.3.2. Gift certificates that the issuer donated

3.3.3.3. A non-cash gift for which the fair market value cannot be determined

3.3.3.4. Gifts provided in exchange for advertising or sponsorship (see Policy 13.3, Sponsorship and Advertising)

3.3.3.5. A gift that gives the donor an advantage valued at more than 80% of the gift amount

3.3.3.6. A payment for a lottery ticket or other chance to win a prize

3.3.3.7. A court-ordered donation

3.3.3.8. The admission fee to an event or program

3.3.3.9. The purchase of goods or services from a qualified done

3.3.3.10. A loan of property

3.3.3.11. The use of a timeshare

3.3.3.12. The lease of premises

4. Types of Gifts Accepted

4.1. Bequests and Legacies

4.1.1. Sample bequest/legacy language for restricted and unrestricted gifts, including endowments, will be made available to donors and their lawyers to help ensure the bequest/legacy is properly drafted and able to be accepted by 51±¾É«. A power to vary purpose clause is to be included whenever possible.

4.1.2. Donors will be encouraged to provide information about their bequest/legacy provision and, if they are willing, to send a copy of that section of their Will naming 51±¾É« or sign a confidential statement of intent form.

4.1.3. During the probate of estates containing a bequest/legacy to 51±¾É« and/or during administration of trusts containing provisions where 51±¾É« has an interest benefiting the University, the Vice-President: Advancement and External Relations, and the Planned Giving Officer, in consultation with 51±¾É« legal counsel, shall represent 51±¾É« in all dealings with the donor’s solicitor and/or the trustee. It is 51±¾É«’s responsibility to follow and monitor the activities of the estate trustee and their lawyer to ensure that the wishes of the donor are met.

4.1.4. It is the responsibility of the Vice-President: Advancement and External Relations, Planned Giving Officer, and 51±¾É« legal counsel, to approve any indemnity and releases or recommend a passing of accounts.

4.1.5. Upon notification of an estate gift, the Planned Giving Officer will:

4.1.5.1. Thoroughly review the materials provided by the estate trustee or lawyer with a view to determining impact on the University;

4.1.5.2. Send a copy of all documentation for review to the Director, Advancement Services, who will engage external legal counsel in complex cases;

4.1.5.3. Promptly correspond with the estate trustee or lawyer to acknowledge receipt of notification and to provide appropriate information as requested;

4.1.5.4. Monitor progress of administration of estate to ensure that 51±¾É«’s interests are protected;

4.1.5.5. Ensure that all relevant information pertaining to the administration of estates is received and reviewed for accuracy;

4.1.5.6. Seek legal opinion/advice on particular issues as needed in consultation with the Director, Advancement Services, who will engage University Counsel as required. If legal costs could become significant, a decision to proceed will be made University Counsel;

4.1.5.7. Provide signature(s) of appropriate signing officer(s), i.e. on behalf of 51±¾É« for release of estate trustee or recommend a Court Passing of Accounts as per Signing Authority Policy (5.7);

4.1.5.8. Upon receipt of bequest monies, ensure proper recording and receipting takes place, as well as proper acknowledgement to estate trustee or lawyer and, if possible, appropriate next of kin;

4.1.5.9. Retain all correspondence in records for future reference; and

4.1.5.10. Ensure appropriate recognition of estate gifts.

4.2. Gifts of Securities

4.2.1. 51±¾É« accepts all gifts of publicly traded securities, bonds, and units of mutual funds.

4.2.2. 51±¾É« may accept gifts of private company stock or closely held stock. Such stock requires an independent valuation. Usually, 51±¾É« will not accept gifts of securities where there is not a reasonable assurance they can be sold.

4.2.3. Securities which carry beneficiary designations such as RRSPs, LIFs, Segregated Funds etc. will be assessed on an individual basis.

4.2.4. Procedures

4.2.4.1. 51±¾É«’s Broker will accept securities on behalf of 51±¾É«, either by electronic means or in certificate form, and will liquidate the securities immediately.

4.2.4.2. Valuation of gifted securities for tax receipt purposes will be at the closing trade value on the day the university receives the shares (or the most recent trading day).

4.2.5. Flow Through Shares

4.2.5.1. Flow through shares are tax-based financing incentives available to the oil and gas, as well as the mining sectors. 51±¾É« will treat such a gift on a case-by-case basis.

4.2.5.2. 51±¾É« will ensure that the donor is advised to obtain independent legal advice on all aspects of the transaction and will obtain a written valuation.

4.3. Life Insurance

4.3.1. 51±¾É« accepts gifts of life insurance where ownership is irrevocably assigned to 51±¾É«. In accordance with CRA, tax receipts will be issued for premium payments made by the donor, and, if applicable, for the cash surrender value of the policy.

4.3.2. Although the preferred mechanism is for the donor to make premium payments directly, if a policy is donated on which premiums remain to be paid, 51±¾É« may pay the premiums provided the donor makes equivalent tax-deductible contributions for that purpose.

4.3.3. 51±¾É«, on the advice of the Ad Hoc Committee on Gift Acceptance, may pay premiums on policies that have lapsed or are about to lapse, provided that the policy benefits are substantial and outweigh the cost of the premiums.

4.4. Reinsured Gift (Plus) Annuity

4.4.1. 51±¾É« will receive gifts of commercial annuities. The amount of the gift receipt and taxation of annuity payments will be in accordance with the CRA guidelines.

4.5. Charitable Remainder Trusts

4.5.1. 51±¾É« will not act as trustee for charitable remainder trusts.

4.5.2. Assets included in trust property must be consistent with the principles and policies set out in this document and other university policies.

4.5.3. The trust agreement shall be either drafted or reviewed by the donor’s own legal counsel. 51±¾É« shall execute no agreement until that person has determined that the trust agreement is in the proper form and that the gift is appropriate for the donor’s situation.

4.5.4. In every instance the Planned Giving Officer, Vice-President: Advancement and External Relations, and 51±¾É« legal counsel will ensure the proper CRA mortality and present value tables are used prior to receipting the gift. An independent third party appraiser shall determine the present value of the residual interest for receipting purposes.

4.5.5. 51±¾É« will request the donor to obtain independent legal advice and approval of Trustee.

4.5.6. 51±¾É« shall approve the trustee of the trust whenever possible.

4.6. Gift of a Residual Interest

4.6.1. The donor shall continue to be responsible for all expenses arising from the property, such as real estate taxes, insurance, utilities and maintenance, after transferring title to the property until 51±¾É« has taken possession of the property. The terms of the gift and responsibilities for expenses shall be specified in a Deed of Gift executed by the donor(s) and 51±¾É«.

4.6.2. 51±¾É« reserves the right to inspect the property and conduct searches to assure that its interest is properly safeguarded.

4.7. Gifts of Real Estate

4.7.1. The following guidelines pertain to gifts of real estate in general.

4.7.2. The donor shall secure an appraisal of the property from qualified, independent appraiser(s). The name and address of the appraiser must be provided.

4.7.2.1. 51±¾É« reserves the right to secure its own appraisal and issue a gift receipt based on it.

4.7.3. 51±¾É« shall determine if the donor has a marketable title to the property, free of liens or encumbrances.

4.7.4. 51±¾É« shall review other factors, including zoning restrictions, marketability, current use and cash flow, to ascertain that acceptance of the gift would be in the best interests of 51±¾É«.

4.7.5. 51±¾É« may conduct an environmental assessment, which shall include at least a Phase 1 environmental audit, and accept the property only if (a) it contains no toxic substances, or (b) they are removed or other remedies have been taken assuring that 51±¾É« will have a reduced risk of liability.

4.8. Gifts-in-Kind

4.8.1. The donor must provide a clear description of the property being donated (the gift-in-kind) including details such as the type of property, its condition and age. The fair market value of the gift must be disclosed with supporting documents in compliance with CRA guidelines.

4.8.2. The needs of the appropriate faculty/department/campus and its willingness to accept the tangible property will be ascertained. If it is deemed useable by the University, an appraisal will be undertaken to determine its fair market value. However, if the item is to be sold by 51±¾É«, the receipt value will be based on the amount for which it was sold.

4.8.3. 51±¾É« must have on file official documentation (e.g. a sales receipt) or an appraisal that defines the fair market value of the donated item. Appraisal fees are the responsibility of the donor or the receiving department. For gifts valued greater than $1,000, CRA recommends an independent appraisal. For gifts valued greater than $5,000, 51±¾É« may require two independent appraisals. In all other cases, an official of the University with expertise in the field of gift can establish fair market value. For corporate donations from inventory, an invoice must be provided.

4.8.3.1. When an external appraiser is required, the donor agrees to cover the costs of appraisal, for which a tax receipt can be issued.

4.8.4. Gift certificates should be reviewed with Advancement Services prior to acceptance as the terms of the certificate, and whether or not the donor is the issuer, determine the ability and timing of a receipt being issued.

4.8.5. A payment for a lottery ticket or other chance to win a prize is not a gift.

4.8.6. The date of donation is the date that legal ownership of the property is transferred from the donor to 51±¾É«, which in the majority of cases is the date of physical delivery of the gift-in-kind.

4.8.7. Under the following conditions, CRA requires that gifts be valued for tax receipting purposes at the original cost to the donor or at the fair market value of the donation, whichever is LOWEST:

4.8.7.1. If the gift was acquired in the last three years

4.8.7.2. If the gift was acquired in the last 10 years with the intent to donate to charity

4.8.7.3. If the gift was received in the last 10 years from a family member or other non-arm’s-length person

4.8.8. If the gift is eligible for a tax receipt but is affected by any of the above conditions, the donor must indicate the original cost of the gift.

4.8.9. Gifts of Art

4.8.9.1. Donations must be free and clear of conditions and restrictions imposed by the donors regarding 51±¾É«’s use of the art.

4.8.9.2. All decisions on whether or not to accept or deaccession a piece will be made in consultation with 51±¾É«’s curator.

4.8.9.2.1. 51±¾É« will consider the cost of appropriate display and insurance in determining whether a piece should be accepted. 51±¾É« may request a cash contribution from the donor to recover such costs prior to accepting the gift of art.

4.8.9.3. 51±¾É« will establish and maintain a comprehensive system of records that includes:

4.8.9.3.1. Documentation pertaining to the provenance and legal title of the piece.

4.8.9.3.2. All correspondence, documents, and other materials pertaining to the piece.

4.8.9.3.3. Photographic documentation.

4.8.9.3.4. Condition and conservation history.

4.8.9.3.5. Insurance records.

4.8.9.3.6. Current location.

4.8.9.3.7. Deaccessioning information if the piece has been put into storage or sold.

4.8.9.4. Gifts of art from an artist or art/antiques dealer are considered inventory, not capital property in accordance with CRA, and are subject to a different valuation.

4.8.10. Gifts-in-Kind to the Library

4.8.10.1. Income tax receipts will normally be issued for gifts valued at over $100. Receipts must be requested at the time of donation.

4.8.10.2. Receipts will be issued only for material retained by the Library, that has been formally transferred to the Library or Archives.

4.8.10.3. Gifts valued at less than $1,000 will be appraised by the Library.

4.8.10.4. Gifts valued at over $1,000 must be appraised by an external appraiser. Gifts anticipated to be valued over $20,000 will require two external appraisers.

4.8.10.5. Upon request, donations will be appraised based on fair market value in accordance with CRA regulations.

4.8.11. Gifts of Certified Cultural Property

4.8.11.1. The donation of Canadian Cultural Property is a unique process subject to particular CRA guidelines.

4.8.11.2. To qualify for special tax status, a gift of Canadian Cultural Property must be made to a designated recipient. At 51±¾É«, only the Library and 51±¾É« Archives is a designated recipient.

4.8.11.3. 51±¾É« will apply to have the gift certified as Canadian Cultural Property. The Canadian Cultural Property Export Review Board, pursuant to their own guideline, determines the appraised value, which the university must use for tax receipt purposes.

4.9. Return of Gifts

4.9.1. A gift subject to a condition precedent is not a gift at law until after the condition is fulfilled. Accordingly, no receipt can be issued until the condition precedent is fulfilled.

4.9.2. A gift subject to a condition subsequent (a condition which operates to defeat a gift which has already been made) allows for reversion of the gift back to the donor.

4.9.3. Once a gift is completed, it is the property of the charity and cannot be returned unless the original gift has failed (for example, the terms of the restricted charitable purpose trust become impractical or impossible to fulfil and it is not possible to obtain a cy-près court order; or, a limited interest in a determinable gift coming to an end). Depending upon the circumstances, it may also be necessary before a gift is returned for the University to obtain authorization from a court in exercising its inherent jurisdiction in charitable matters, where necessary. Legal advice should always be obtained before a gift is returned.

4.9.4. Where a gift reverts back to the donor, the university has 90 days upon returning the gift to file an information return with CRA in cases where an official donation receipt was issued, and where the returned gift has a fair market value of over $50.

4.10. Definitions

4.10.1. Donor Advised Fund: A charitable giving vehicle administered by a public charity created to manage charitable donations on behalf of organizations, families, or individuals. To participate in a donor-advised fund, a donating individual or organization opens an account in the fund and deposits cash, securities, or other financial instruments. They surrender ownership of anything they put in the fund, but retain advisory privileges over how their account is invested, and how it distributes money to charities.

Related Policies, Procedures and Documents

• Policy 5.13 Retention of External Legal Counsel