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Q. What is the LCC Foundation’s gift fee?
A. The fee on restricted-purpose gifts is our cost of being accountable to you and our other donors. This accountability includes our commitment to provide timely gift receipts, accurate records, expert management of gift funds, and efficient disbursement of gift funds to programs at the College. Unrestricted gifts made to the College for the area of greatest need are not assessed a gift fee.
Q. How much is the gift fee?
A. As of July, 2009, each donation to the Foundation will be assessed a one-time administrative fee equal of 3 percent of donations to endowed funds and capital projects and 5 percent of donations to current use funds.
Q. Why does the LCC Foundation have a gift fee?
A. The gift fee allows the LCC Foundation to reduce its reliance on direct funding for its operations from Lane Community College, thus freeing College funds for education. Gift fee revenue is directly related to the LCC Foundation’s cost of doing business. Effective fund-raising requires deployment of financial resources to cover direct costs of soliciting, processing, and accounting for donated funds. As gifts to benefit Lane Community College increase, the costs of gift receipting, accounting, investment and disbursement increase.
Q. How are operations of the LCC Foundation funded?
A. Foundation operations are funded through a combination of revenue from earnings on short-term funds, endowment management fees, real estate/property management income, unrestricted gifts, gift fees, and direct support from the College.
Q. Do other colleges and universities charge gift fees? Nationally? In Oregon?
A. A gift fee of 3-5 percent is not uncommon at university foundations throughout the country. Both the University of Oregon Foundation and Oregon State University Foundation currently charge 5 percent.
We are a relatively young College foundation with a comparatively small endowment and thus endowment management fees only partially cover our costs of doing business. However, even older foundations with much larger endowments frequently charge gift fees. For example, the University of Connecticut Foundation, with an endowment of $250 million, charges gift fees ranging from 3-5 percent.
Q. The local non-profit organizations I support don’t charge gift fees. What’s the difference?
A. The difference is primarily one of terminology. All community organizations have operating costs. In general, revenue from contributions helps in part to support them—whether or not a formal gift “fee” is identified. United Ways, for example, typically charge fees of 15 percent or more.
In the non-profit sector, best practice standards hold that operating costs in the range of 15-20 percent are considered to be excellent, assuring that approximately $.80 of every dollar contributed goes to providing direct services. By comparison, $.95 to $.97 of each dollar you give to the LCC Foundation gets put to work by the College for the specific purpose you choose to support.
Q. How often does the gift fee change?
A. The LCC Foundation’s funding sources are recommended by our Finance & Investment Committee and approved by our Board of Directors. The Finance & Investment Committee reviews the gift fee on an annual basis. The fee structure was initially approved by the board in July, 2009. In order to assure budgetary and financial stability, it is changed only rarely.
Q. Can the gift fee be waived?
A. If a gift is made by a private foundation that has a written policy stating it will not pay gift fees, the LCC Foundation will waive the fee.
Q. Does the LCC Foundation charge other fees?
A. Like the vast majority of other foundations, the LCC Foundation charges an annual fee to manage endowed funds that are invested in perpetuity. Because we want to maximize our endowment’s growth over time, we keep this annual management fee to a minimum, currently 2 percent of the market value of the endowment.
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