Named gifts: Part 6

By Todd Cohen

Circumstances can change, both for the charity and the donor, so charities should be careful in preparing for the unexpected, experts say.

Emory University in Atlanta is developing a new policy to provide consistent guidelines throughout the university as it prepares for a campaign of roughly $1 billion.

The document, now in its fifth draft, addresses the range of opportunities for naming and minimum gift levels required for naming, says Dan Macaluso, vice president for development, university programs.

The policy also requires that 5 percent of a gift to fund a college or construction project be set aside for an endowment to pay for maintenance and operations.

It also says agreements for multi-year pledges should include provisions that when the funding runs out, the donor’s name no longer is associated with the program the gift funded.

A policy at the Museum of New Mexico Foundation requires that any term limits should be part of negotiations for a gift.

But changes in circumstances may defy expectations.

At a suburban hospital of the Millard Fillmore Health System in Buffalo, N.Y., two donors in the mid-1990s made separate gifts to name the hospital’s business and admissions offices, respectively, says consultant Janet Hedrick, at the time the system’s vice president for development.

The larger gift was for the business office, which at the time occupied more space. But over time, the admissions office eclipsed the business office, and the two operations switched physical spaces, although the donors’ names did not.

That upset the donor who had made the gift to name the admissions office, which now occupied the larger space that still was named for the other donor.

“You have to be very clear, when you word how these gift opportunities are done and the way the wording is, to make it very clear that the gift is proportionate to the visibility and size of the space,” says Hedrick, now senior associate in the Arlington, Va., office of Minneapolis-based Bentz Whaley Flessner.

Buildings also can come down, as can the reputations of donors, and charities should be prepared to deal with such changes, says Karla Williams, a consultant in Charlotte, N.C.

“When an institution makes a decision,” she says, “it needs to be very thoughtful because it is the beginning of a visual partnership that doesn’t go away with time.”

Other stories in the series:

Part 1: Charities, donors play name game.
Part 2: Process for soliciting naming opportunities begins early. 
Part 3: Setting right price for named gifts a key issue for charities. 
Part 4: Charities use naming opportunities for fundraising leverage.
Part 5: Charities look for ways to package gift-naming opportunities. 

Part 7: Gift-naming a strategic fundraising tool for charities.

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