§ 17-7-304 — Appropriation for expenditure or accumulation of endowment fund; rules of construction

Wyoming § 17-7-304

• Jurisdiction: Wyoming
• Title 17: Corporations, Partnerships and Associations
• Ch. 7: CHARITABLE, EDUCATIONAL, RELIGIOUS AND OTHER
• Art. 3: UNIFORM PRUDENT MANAGEMENT OF INSTITUTIONAL FUNDS

Text

(a) Subject to subsection (d) of this section and to the
intent of a donor expressed in the gift instrument, an
institution may appropriate for expenditure or accumulate so
much of an endowment fund as the institution determines is
prudent for the uses, benefits, purposes and duration for which
the endowment fund is established. Unless stated otherwise in
the gift instrument, the assets in an endowment fund are donor-
restricted assets until appropriated for expenditure by the
institution. In making a determination to appropriate or
accumulate, the institution shall act in good faith, with the
care that an ordinarily prudent person in a like position would
exercise under similar circumstances, and shall consider, if
relevant, the following factors:
(i) The duration and preservation of the endowment
fund;
(ii) The purposes of the institution and the
endowment fund;
(iii) General economic conditions;
(iv) The possible effect of inflation or deflation;
(v) The expected total return from income and the
appreciation of investments;
(vi) Other resources of the institution; and
(vii) The investment policy of the institution.
(b) To limit the authority to appropriate for expenditure
or accumulate under subsection (a) of this section, a gift
instrument shall specifically state the limitation.
(c) Terms in a gift instrument designating a gift as an
endowment, or a direction or authorization in the gift
instrument to use only "income", "interest", "dividends", or
"rents, issues or profits", or "to preserve the principal
intact" or words of similar import:
(i) Create an endowment fund of permanent duration
unless other language in the gift instrument limits the duration
or purpose of the fund; and
(ii) Do not otherwise limit the authority to
appropriate for expenditure or accumulate under subsection (a)
of this section.
(d) The appropriation for expenditure in any year of an
amount greater than seven percent (7%) of the fair market value
of an endowment fund, calculated on the basis of market values
determined at least quarterly and averaged over a period of not
less than three (3) years immediately preceding the year in
which the appropriation for expenditure is made, creates a
rebuttable presumption of imprudence. For an endowment fund in
existence for fewer than three (3) years, the fair market value
of the endowment fund shall be calculated for the period the
endowment fund has been in existence. This subsection shall
not:
(i) Apply to an appropriation for expenditure
permitted under law other than this act or by the gift
instrument; or
(ii) Create a presumption of prudence for an
appropriation for expenditure of an amount less than or equal to
seven percent (7%) of the fair market value of the endowment
fund.