1.   UCSD Policy and Procedure Manual (PPM)

   150-35	Classification, Acceptance, and Administration of Awards from Private Sources
   410-3	Administrative Fee on Gifts to UCSD and the UC San Diego Foundation

2.  UC Policy on Support Groups, Campus Foundations, and Alumni Associations, September, 1995

A top priority of UCSD is to build the value of endowment and gift funds, as held by either The Regents or the UC San Diego Foundation on behalf of the campus. Effective July 1, 1998, this policy eliminated the need for an assessment on the corpus of the Foundation's endowment, placing it at par with the campus endowment as held by The Regents, and provided a mechanism to ensure the UC San Diego Foundation was an equal partner in the campus fundraising environment. Effective July 1, 2000, this policy was revised so as to also provide a funding mechanism for the UCSD Capital Campaign. Effective July 1, 2002, this policy is again revised to provide additional funding for the UCSD Capital Campaign and the Chancellor / Vice Chancellor units by reducing the amount of interest earnings credited to certain funds down to 0%, effectively eliminating any earnings being accrued to those funds.

1.  Effective July 1, 2002, the first 2% per annum of investment returns earned on current (expendable) gift and private grant funds, held by either The Regents (UCSD campus) or the UC San Diego Foundation will be allocated to the Chancellor / Vice Chancellor units associated with the individual funds.

   Any earnings in excess of 2% per annum will be made available to the Vice Chancellor - External Relations for the following purposes:

   1. First, to cover the operating expenses of the UC San Diego Foundation;

   2. Second, to provide funding for the UCSD Capital Campaign.

2.   By way of information only, for the period July 1, 1998 to June 30, 2000 (prior to the need for Campaign funding), any earnings made available to External Relations as a result of this policy that were not needed to cover the annual operating costs of the UC San Diego Foundation were placed in a Reserve Fund, treated as a fund functioning as an endowment. Money in the Reserve Fund could be expended for only two purposes (Reserve Fund earnings are to be used first, then Reserve itself):

   1. To help provide a return to funds at the stated cap level in years that the actual return earned was less than the cap; and

   2. To help cover Foundation expenses in years when the excess current fund earnings made available to Vice Chancellor - External Relations are insufficient.

   Once the Reserve Fund reached a sufficient size, the annual return of the Reserve fund would fully absorb the Foundation's expenses. Given recent policy changes, it is unlikely that this Reserve Fund will ever reach sufficient size to meet its initial intent.

3.  If donor designations on new Regents or Foundation gifts or private grants require that earnings may accrue only to the fund, then the Dean or department affected will need to provide the campus with an amount of unrestricted funds equivalent to the interest that would have been made available to the Chancellor / Vice Chancellor units and the Vice Chancellor-External Relations.

4.  Spending allocations (income payout) to Regents or Foundation gift endowment funds, in accordance with Regents or Foundation endowment spending policies, are exempt from this assessment. However, once payout is made available, the payout is placed into a current fund by the campus and the Foundation. Current fund earnings on any accrued balances from endowment spending allocations (that is, earnings on earnings) will be subject to this policy.

5.   In keeping with legal obligations under established charitable trust laws, donors will be informed of this policy.

6.  This policy may be modified from time-to-time to provide for any significant long-term changes (increases or decreases) in current fund yields or for other significant purpose.

1. UCSD General Accounting Office and UC San Diego Foundation Accounting Office

   1. Credit the Chancellor / Vice Chancellor units with the appropriate amount of interest earnings per this policy, and credit the Vice Chancellor-External Relations fund with the balance of earnings, if any.

2. Vice Chancellor-External Relations

   1. Assume fiscal responsibility for the operating expenses of the UC San Diego Foundation as budgeted and approved by its Board of Trustees annually.

   2. Annually prepare a report to the Vice Chancellor-Resource Management and Planning, of the income generated by this policy, the expenditure of that income, and the balance of the Reserve Fund, and the amount made available for expenditure on the campaign.

3. Department Personnel, Development Officers, Gift Administration, and Office of Contract and Grant Administration

   1. Inform donors or potential donors in written solicitation materials and proposals, in verbal discussions, and on receipts, of the assessment policy.

   2. Advise UCSD General Accounting Office or the UC San Diego Foundation Accounting Office of an alternate source the excess earnings are to be taken from, if donor restrictions require.