The bond issue failed, and the new building will most likely not happen in my lifetime. What can be done with that money? For the past few years it has just been sitting in an account managed by that nonprofit. Is there a time limit on how long they have to hold it before it can be used for another purpose? Or does it just sit there until Oprah comes to town and gives us the rest of the $10 million or so?
"State law governs gift restrictions. In many states, the primary law that governs the expenditure of charitable assets is the state's version of the Uniform Prudent Management of Institutional Funds Act ("UPMIFA"). UMPIFA governs certain activities related to the management of charitable funds including the release or modification of gift restrictions.
"UPMIFA is a default rule that is only effective when the donor has failed to express a clear intention a gift instrument. However, under the Act, virtually any record can serve as a "gift instrument" that legally restricts the gift. For example according to the comments to UPMIFA, an e-mail, a jotted down note clipped to the check, a statement in the memo portion of the check or even the language of the solicitation itself can serve as part of a gift instrument that will override UPMIFA's terms.
"Where the funds cannot be used for the purpose for which they were solicited, UPMIFA specifies the process for modifying or terminating the restriction. Essentially, where restrictions become outdated, wasteful or unworkable, UPMIFA permits charitable institutions to seek a release from the original donor. Alternatively, the charitable institution can petition the court for an order modifying or terminating the restriction. In such cases, UPMIFA requires notice to be provided to the state Attorney General.
"Finally, UPMIFA includes an option for charitable institutions to modify small, old funds in a manner consistent with the original purpose of the gift without going to court. The streamlined procedure generally requires notification to the state Attorney General. If the Attorney General does not object within the sixty day period, then the charitable institution can unilaterally release the restriction. Generally, this option is only available for funds valued at less than $25,000 that are more than 20 years old although some states have adopted different thresholds."
Carter suggests checking out these resources for more information: