VII.2. Development

Raising Gift Funds

What is the University of Wisconsin Foundation?
A nonprofit, tax-exempt Wisconsin corporation, the University of Wisconsin Foundation is the official fund-raising and gift-receiving organization for the University of Wisconsin-Madison. Since 1945, the UW Foundation has engaged those who care about the University by providing opportunities to enhance its teaching, research and outreach programs, and has guaranteed ethical stewardship of the gifts it has received.

Because state funding currently provides only the means for a basic education, private funding supplements state and federal dollars and supports many special programs and projects not possible through conventional funding sources. Examples of these are professorships, fellowships and scholarships in all academic disciplines, research efforts and building projects. The UW Foundation focuses on these main areas of gift development:

• Major Gifts: With your assistance, development directors identify and cultivate prospective donors and provide stewardship to current major donors. Our philosophy is one of long-term relationship building and donor-driven gift priorities. On average, a major gift is secured after 9 meaningful contacts with the donor, which can extend over a period of approximately 6 months to 2 years or more.
  
• Planned Giving: UWF staff assists individuals who wish to include the UW in their estate plans, establish charitable remainder trusts, make pooled income and gift annuity funds, or make gifts of real estate or insurance policies. Contact Planned Giving.
  
• Corporate and Foundation Grants: The Corporate and Foundation Relations team serves all UW-Madison schools and departments to help them secure gifts from companies and private foundations. Go to webpage.
  
• Annual Fund/Telefund: Student callers contact alumni seeking support for the School or College from which the alumni graduated. Donors may designate their gift for any UW-Madison fund managed by the UWF.

Your department likely has funds in both the UW System Trust and the Foundation. University of Wisconsin System Trust Funds represent unsolicited gifts to the UW Board of Regents (typically estate gifts). The Trust Funds Office is responsible for the administrative and investment oversight of endowment and other investable funds entrusted to the Board of Regents. These funds consist primarily of monies that have been gifted directly to a UW institution, rather than to one of the separate, supporting foundations. For more information, please visit http://www.uwsa.edu/tfunds. For information regarding funds housed at the UW System Office of Trust Funds, please contact Mehdi Rezai.

The Office of the Chancellor issues an annual memo on policies regarding gift funds. Please review the UW’s policies regarding gift deposits and expenditures: http://www.rsp.wisc.edu/policies/UWF_Policy.pdf.

Letters & Science Development Directors

The UW Foundation has nine development directors assigned to work on various aspects of development for Letters & Science at the college and departmental level; each department and program has been assigned a specific director. Please contact Ann Lippincott, 263-3604 or ann.lippincott@uwfoundation.wisc.edu to find out your department’s liaison.

A special director has been assigned to help manage stewardship and donor relations across the college. In addition, L&S works closely with the UW Foundation’s vice president for planned giving and its regional directors to share information on donor interest and gift opportunities.

Letters & Science administration works closely with its departments and with the professional staff of the UW Foundation to develop priorities and to match donor interests to college and departmental needs. A list of current college priorities can be found on-line at http://www.ls.wisc.edu/giving.htm.

Maximize Your Department’s Development Opportunities

Before embarking on new fund-raising initiatives, your department must have basic donor relations best practices in place. Just as mismanaging funds is the best way to lose support, effective stewardship of today’s gifts is the best cultivation for continued support.

Please refer to the Stewardship section of this chapter for information regarding donor relations best practices.
Managing Gift Funds

• Campus Access – Department chairs and administrators may receive current information on their UWF gift accounts on-line through Campus Access (www.uwfoundation.wisc.edu/funds). Campus Access provides comprehensive information on all of your department’s funds. Standard UWF forms (check request, gift deposit) are available through Campus Access, as well as a variety of custom reports. For more information or additional assistance, contact Ann Lippincott.
  
• Types of Gift Funds – Each gift received at the Foundation is deposited into a specific fund account. The Foundation holds two types of accounts for the University: expendable and endowment. Expendable funds are considered short-term accounts, as all monies in this type of fund are available to be spent for the purpose specified by the donor(s), whereas endowment funds are long-term, invested accounts that earn spendable income each quarter:
  
  • Expendable: The first two digits of the fund number on expendable accounts are “12.” The Foundation considers these accounts short-term because gifts received that are not transferred into endowment accounts are normally spent within a year of receipt. Scholarships and program funds are examples of the kinds of funds best suited to the investment philosophy of expendable accounts. Expendable accounts are invested to safeguard the principal and to allow short-term liquidity.
    
  • Endowment: The first two digits on this type of account are “32”. This account is a long-term or invested account, which requires a minimum balance of $10,000. All of the Foundation’s endowment accounts are pooled and invested as one portfolio or “endowment fund.” All endowment funds earn income each quarter. Available income can be expended at any time or, alternately, any available income amounts allocated can be reinvested into the principal

    Endowment funds administered by the Foundation are based on an initial gift that provides annual investment income. The endowment payout formal (4.75% of a rolling 12 quarter average) is designed to smooth out the impact of market fluctuations. A $10,000 gift (the minimum to create an endowment) will generate approximately $470 a year for use by the campus unit. Only the interest income is spent while the principal remains intact and appreciates in value over time. Individual funds and their designated use are determined by the donor(s). Suggested gift endowment levels depend on several factors, including donor capacity and the intended use of the fund, and range from $10,000 for an undergraduate scholarship to over $2 million for a named distinguished chair.

• Managing Your Existing Funds for Full Impact – Regularly monitor the status of your department’s funds through Campus Access. Pay close attention to the “Income Available” in your endowment funds (this information is updated quarterly). If the “Income Available” significantly exceeds the “Estimated Annual Income,” review the fund description to ensure the fund is being utilized appropriately. As a general rule, an endowment fund should not have a balance of more that three times the “Estimated Annual Income” in the “Income Available” category. You may want to consider transferring some of the excess income back into the account principal, so that the fund earns maximum income. Funds in the “Income Available” category do not earn interest. Explore options for utilizing income available to spend with your development director.

Stewardship

The College places a high priority on showing our appreciation to the donors who support our departments and programs. Effective stewardship of donors includes timely acknowledgment of gifts, managing gifts appropriately and in accordance with the donor’s wishes, communication of use of gifts to donors, and keeping donors connected to the department/program they support. Conscientious stewardship of a donor’s gift is the most effective and lasting form of gratitude that can be shown. It is also our obligation, because donors have a right to know when, where and how their gifts are used. Some stewardship best practices are listed below. The Director of Donor Relations and your development director are available to help you with your stewardship program.

Cultivate and Thank Your Donors

• Thank You Notes – Ensure that all donors to your department receive a timely, personal thank you note from the Chair. Donor reports are readily available through Campus Access to help you create a merge file to produce thank you letters. Also make sure recipients of named scholarships, fellowships and professorships annually send a thank you note to the fund donors. Provide students with this guide to help them write appropriate thank you letters.
  
• Donor Updates – Let your key donors know how their gifts are used and how they have impacted the department. Chairs should inform donors when a scholarship, fellowship or professorship recipient has been named. Also, keep donors informed of new faculty, publications and lectures in your department that may be of interest to them.
  
• Events – Invite donors, friends and emeriti faculty to department events, especially those events that their gifts support (i.e. awards/scholarship banquets, a lecture by a professor holding an endowed chair). Also, think about traveling professors and opportunities for donor interaction. Your development director can help you with donor meetings.
  
• Campus Visits – In coordination with UWF development staff, invite your best donors and/or prospects to campus for visits with your faculty or discussions with students.
  
• Fund Status – Know the status of your department’s funds. Let donors know when their funds are reaching critical thresholds, such as when a scholarship or fellowship will be awarded for the first time. Make sure all scholarships and fellowships are awarded on a timely basis. The best way to lose donor support is to mismanage funds. They will stop giving and tell their friends about it.

Boards of Visitors

The College of Letters & Science has one college-level Board of Visitors that is comprised of alumni and friends of the college who have achieved prominence in education, business, and/or government. The board meets two times a year and advises the dean on curricular, political, and fiscal challenges facing the college. The board also assists in planning and implementing college relations and development initiatives. The dean occasionally appoints subcommittees to carry out limited-term initiatives on behalf of the larger board. Individual board members play significant roles in philanthropy toward individual departments and/or the college in general.

The College also has several formally-organized boards that are affiliated with professional schools, academic departments, and specific arts and humanities projects.

Departments that do not currently have boards but wish to form them MUST complete the planning process discussed in the Letters & Science – UW Foundation document, Planning Document Requirements for Departments Requesting to Form Boards of Visitors. Please contact the Dean’s office and your UW Foundation liaison to discuss this process.

Communicate With Your Alumni, Friends and Emeritus Faculty

• Newsletters – Keep all of your graduates, friends and emeritus faculty informed of department activities and news via a newsletter or annual letter from the Chair. Consider featuring gifts to the department and how they have impacted the department, students, etc. In an effort to avoid error and the risk of alienation, the Foundation generally advises departments not to list donors in their publications. If you decide to include a donor listing, information pertaining to donors found in Campus Access is not to be used to construct honor rolls; such lists must be obtained from the UW Foundation directly. Please contact the Director of Donor Relations for assistance.
  
• Web site – Maintain current information of interest to alumni and friends on your department web site and, if possible, create a designated “For Alumni & Friends” section on the site. Many departments and programs are taking advantage of the opportunity to create on-line giving forms that allow users to designate gifts to the UW Foundation for a specific department or program using a credit card. This is a free and convenient way to encourage gifts when people visit your web site. Departments that have implemented on-line giving also are linked from the Letters & Science Giving Opportunities web page.
  
  To set up on-line giving, please complete the Web-based form at http://www.uwfoundation.wisc.edu/givingsetup. The University of Wisconsin Foundation requires the Dean to approve each form before it is activated. Please note: The setup form automatically generates a message that provides the relevant information and requests approval. Dean Sandefur has delegated approval authority to Lucy Mathiak, the Assistant Dean for Communications and College Relations.
  
• Web Strategy (http://www.uwfoundation.wisc.edu/apps/) – Web Strategy provides access to the University of Wisconsin-Madison alumni, donors and friends database. It is provided to campus partners who have a business need to access basic information about alumni or friends of the university. Currently there are two different levels of access: The first level provides the individual’s basic demographic information such as addresses, phones, emails and job information. A second level adds a view of the individual’s gift and pledge activity to funds associated with your unit. Information is updated centrally and then synchronized with the Wisconsin Alumni Association system. Mailing lists are free from the WAA or the UW Foundation and are created upon request. With several formats available, lists can also be requested for purposes other than mailings. More information or login requests can be directed to Sharon Adler, Senior Director of Database Services at 263-8419 or sharon.adler@uwfoundation.wisc.edu.

Communicate with UWF and L&S External Relations Staff

• Keep your UWF development director well informed of department events, new faculty, new books, news from former students, etc. Be sure your development director is on your mailing list.
  
• Write a brief layperson’s summary of your department’s priority funding needs for your UWF development director to share with donors and colleagues. Include important background information such as department rankings, traditional strengths, recent activities and accomplishments, etc.
  
• Think about and identify potential donors to your department.
  
• Identify faculty members in your department who are interested in development.
  
• Respond to UWF information requests regarding fund usage and general departmental questions. UWF will request the names of fund award recipients every fall. This information is used to send a personal Endowment Report to donors of endowed scholarships, fellowships, professorships, and research and programs funds. These customized reports include a financial statement and information about how the fund was utilized during that academic year.

UW Foundation development directors and staff look forward to working with you.

Updated August 2009 per MC and AD by tb.