1. Annual Giving (Unrestricted) – These are gifts that are used for ongoing current budgetary expenditures including un-endowed or general scholarships. These gifts are not restricted by the donors as to their use.
2. Special Projects (Restricted) – These are gifts that are expendable for specific approved purposes. The donor designates the use of his/her gift for special purposes.
To assure continuity and integrity of the gift, all restricted gift documents should contain language similar to:
“Should the purpose(s) of the gift, as detailed herein, no longer exist(s), the Omicron Delta Kappa Society and Educational Foundation Board of Trustees are authorized to use the earnings of the gift, as they shall determine, in order to best carry out the intended purposes stated in the agreement or the mission of the organization.”
3. Endowment – Endowment gifts are considered perpetual. It is a special or reserve fund that stipulates or restricts the use of the income from the endowed fund. From Omicron Delta Kappa’s point of view, the terms of the endowment should be written with wide flexibility, yet ensuring the donor is comfortable and satisfied with the terms of the agreement.
A. Types of Endowments
- Pure Endowments: These are endowments which are to continue in perpetuity and in which the principal is not to be invaded.
- Quasi-endowments: The principal of these endowments can be used upon the approval of the Board of Trustees. Typically these funds are board-designated endowed funds.\
- Term Endowments: These funds are usually set up for a specific period of time. It is usually understood that the principal will be withdrawn from the investment pools after the stated period of time (for example, a period of 3-10 years).
- Preservation and Maintenance Endowment: These funds are to be specifically used to support the long-term preservation, care and maintenance for the National Headquarters Building (located at 224 McLaughlin Street, Lexington, VA 24450).
B. Endowment Restrictions
No restrictions on how gifts may be used will be honored without proper approval from the Board of Trustees.
C. Minimum amounts required and time allowed to establish endowed funds:
- Named Scholarship – $25,000
Because conditions change over time, it is recommended that endowment funds contain the following contingency clause:
“If circumstances should arise in the future that make it illegal, impossible, or impracticable to use the gift for the purposes specified above, then the Board of Trustees may use its best judgment to determine prudent use of the fund in an attempt to fulfill the primary purpose of the fund or organization.”
The maximum period to raise an endowed fund may not exceed five years.
