Section 11.7 - Donations from Employees in Support of Their Own Programs
Date: September 2007
Approved: Senior Associate Vice President for Business and Finance
The University receives donations of funds from University employees to support their own research or other programs in their own units/departments. The University also receives donations of funds from members of University employees' families or by corporations in which an employee holds a significant or controlling interest.
Donations of this nature are important to the University's intellectual and operational life; however, specific guidelines must be followed in order for these donations to be handled appropriately in a manner that does not create awkwardness for either the employee/donor or for the University. Procedures include the following:
- Unit/department heads are responsible for ensuring that expenditures of donated funds comply with all relevant regulations referenced in this section. The unit/department head and the employee/donor will develop an understanding regarding the use of the donated funds and record that understanding by completing the Employee Donor Agreement Form.
- Federal Treasury Regulation Section 1.170A and other guidance govern these types of transactions. Section 170 of the Internal Revenue Code provides that a gift may not be fully deductible if there is a direct or indirect personal benefit to the donor. The employee/donor should consult with a personal tax advisor as to whether his or her gift is considered a deductible charitable contribution. Examples of circumstances in which a donation may not be fully deductible include when the funds are used to support the employee/donor's own salary or for travel or entertainment in which the employee/donor (or family members) participate. For this reason and to avoid the appearance of a conflict of interest (COI), the University prohibits the use of donated funds (or substituted equivalent amounts from institutional funds) to fund any or all of the employee/donor's salary. Donated funds may be used for the employee/donor's travel only when it is determined that such travel is exclusively for University business. The policy regarding conflict of commitment and interest may be found at the Office of the Vice President for Research.
- If the funds are to be used in an area where the employee/donor has consulting relationships or other interactions with personal business activities, special care should be exercised in the use of donated funds. Guidance should be sought from the designated unit point of contact for conflict of interest and the COI officer in the Office of the Vice Chancellor for Research. If University students are involved in the external activities, those students may not receive funding from the donation.
- The University FOAPALS in which donated research funds are deposited should be under the control of the unit/department head, departmental business officer, or some other official who is not under the supervision of the employee/donor. Guidance should be sought from the Office of Sponsored Programs and Research Administration in determining if the funds should be considered a sponsored activity in accordance with Section 11.2, Distinctions Among Gifts, Grants and Contracts.
- Deficit spending is not permitted in these accounts.
Employee Donor Agreement Form
Employees who are donating funds for their own program must complete the Employee Donor Agreement Form. The unit business manager and/or other independent department official maintains the original completed form in a file. A copy of the completed form must accompany the gift and/or gift transmittal sent to the University of Illinois Foundation or local Gift Processing and Stewardship Services Office prior to establishment of an account and expenditure of any funds.
Please send questions regarding this policy manual to OBFSPolicies@uillinois.edu.
Last Updated: May 22, 2012