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Pursuant to State Board
of Regents (hereinafter referred to as the "Board") Policy
114:01:07:02 which directs that each SBR institution shall
formulate a written agreement with its foundation which describes
their respective responsibilities and the services the institution
provides the foundation, this agreement between East Tennessee
State University (hereinafter referred to as the "institution")
and the East Tennessee State University Foundation (hereinafter
referred to as the "foundation'') is mutually set forth and ratified
as attested by the affixed signatures of the presidents of the
institution and the foundation following adoption by the foundation's
Board
of Directors.
Definition of Foundation
As defined in its restated charter of
incorporation filed on January 20, 1992, the foundation is a
not-for-profit organization which exists solely to support and advance
the objectives of the institution. The foundation is not an operational
function of the institution but is, rather, a separate legal entity
operated as a tax-exempt corporation chartered within the State
of Tennessee.
Foundation/Institution Relationship
The basis for the foundation/institution relationship is derived
from a shared interest in the institution's development. The institution
has, therefore, designated the foundation as an approved fund-raising
arm of the institution and has allocated institutional human and
material resources in support of the foundation's operations. And,
while it is recognized that the foundation's identity is to be maintained
separate from the institution, the accountability and conduct of
the foundation are concerns common to the foundation, the institution,
and the Board.
Institutional Participation in Foundation Governance
To ensure an appropriate level of institutional participation
in foundation governance, the foundation
bylaws stipulates that the president of the institution, the
executive vice president of the foundation and the chief financial
officer of the institution shall be members of the foundation's
board of directors. The bylaws of the foundation further stipulate
that the president of the institution serve on the Executive Committee
with the executive vice president of the foundation and the chief
financial officer of the institution serving as ex-officio members.
The chief financial officer of the institution serves in the capacity
of assistant treasurer.
Foundation Budget
The foundation's Executive
Committee shall adopt an annual budget. In conjunction with
the Foundation Budget Committee, the institution will develop and
present a recommended budget to the foundation for its approval,
to ensure that institutional objectives are reflected in the allocation
of foundation funds.
Foundation Policies and Procedures
The foundation's policies and procedures concerning its operations
are incorporated in its charter and bylaws, the ETSU
Policy on Solicitation and Acceptance of Gifts, and all operative
related resolutions of the foundation. These policies, which incorporate
sound business principles and safeguard compliance with donor interest
and conditions, are maintained in an easily accessible form by the
foundation executive vice president. It is recognized that investments
by the foundation are governed by TCA 35-10-101 et seg. It is
also recognized that prior to acceptance of any gift to the foundation
which requires institutional support, approval must be obtained
from the college president and, if applicable, by the Chancellor.
No institutional funds, including contributions to the institution,
may be transferred directly or indirectly to the foundation. It
is understood that instances may occur where a donor inadvertently
directs a contribution to the institution which is intended for
the foundation. In those cases the foundation executive vice president
is charged with evaluating the check or other conveyance along
with any accompanying documentation to determine whether there
is sufficient and clear evidence of donor intent. Barring such
evidence, the executive vice president will contact the donor
for clarification prior to the deposit of the contribution.
The foundation respects Board and institutional responsibilities
for institutional personnel administration. The foundation's routine
procedure for disbursing funds ensures that there can be no foundation
expenditures for compensation of institutional personnel, i.e.,
salary supplements and perquisites, without advance approval by
the institution president and Chancellor.
Foundation Records and Reports
As stipulated by the foundation bylaws, the foundation executive
director shall have custody of all monies, papers and securities
of the foundation. The executive vice president is also responsible
for the preparation of all foundation reports. The institution's
business office assists the foundation executive vice president
by maintaining the foundation's operating accounts separate from
institutional records and accounts. Monthly reports are furnished
by the institution's business office to the foundation executive
vice president detailing the balance and current month's activity
in all foundation accounts. The institution receives no compensation
from the foundation for these services. Records and accounts maintained
by the foundation are available to the institution, the Comptroller
of the Treasury of the State of Tennessee, and the Board. The
foundation Executive Committee shall issue a comprehensive annual
financial report to the president of the institution and the Chancellor,
prepared in accordance with generally accepted accounting principles.
In addition, initial and amended foundation charters and bylaws
filed with the Secretary of State shall be submitted by the president
of the institution to the Chancellor for review.
Foundation Members
The institution acknowledges without reservation its profound
gratitude and respect for the outstanding men and women who volunteer
their valuable time, leadership, and wisdom in service as members
of the foundation. Receiving no compensation other than the intangible
rewards of selfless service to the institution and community, these
business, industrial, and civic leaders make a contribution to the
institution which far exceeds the very substantial financial support
they generate for its growth and development. Ronald E. Beller,
President
East Tennessee State University
October 14, 1987
John W. Thomas, President
East Tennessee State University Foundation
October 14, 1987
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