After we lost our daughter in a car accident, we donated some of the insurance money, along with donations from friends and family, to her high school's 501(c)(3) education Foundation. Each year we get scholarship nominations from the school's teachers and review them to select a winner. After 20 years, we don't know the teachers very well and it is becoming a drain on the family emotionally. Is it possible to transfer these funds to a different organization of our choice and let them handle it, provided the family agrees that the new organization is an appropriate charity of which our daughter would have approved? —From the Website.
Normally, once a charitable contribution is made to an organization the gift is owned and controlled by the charity, not the donor, unless the donor has retained certain rights in the donation agreement. It doesn’t sound as though you retained any rights in your situation except perhaps to advise on scholarship recipients. You can always ask the Foundation to transfer the funds to another scholarship fund, but they are not likely to do so.
You can accomplish what you want, however, simply by relinquishing your role in the selection process. You can let the Foundation make the selection of a recipient, as it undoubtedly does with other funds in its possession. You believed her high school Foundation was an appropriate charity of which she would have approved when you made the original gift, and you haven’t said anything that would suggest it is not still an appropriate organization. You have done what you could personally do to honor her legacy for 20 years. If you want to relinquish your personal role, why shift the funds to another organization where it will probably be administered as an essentially anonymous pot of money without regard to your daughter’s legacy or your efforts? Why not leave the decisions to those affiliated with her high school, who have worked with you for two decades and have a long history of knowing your daughter, your family and the current needs of students like her?
Comments
I’m not sure I’d leave it to a school to manage the fund, unless you’re comfortable with the possibility that they may eventually absorb it into general operations or redirect it to another school need. Another option would be to transfer it to a smaller community foundation that manages grants and scholarships. They are legally bound by their bylaws to follow your guidance in perpetuity, unless you specify a sunset date. —C.S.
Especially since the original query says "along with donations from friends and family, to her high school's 501(c)(3) education Foundation" -- there's no suggestion that there was any instrument giving control of the funds to the grieving parents, and since there were other donors, the parents can't move the fund, it belongs to the school's foundation. —J.G.