University of Georgia Foundation University Council Presentation December 2, 2004

University of Georgia Foundation MISSION It is the mission of The University of Georgia Foundation to administer with fiduciary care the assets of the Foundation for the long-term enhancement of the University of Georgia; to provide volunteer leadership and assistance to the University in its development and fund-raising activities; and to provide broad advice, consultation and support to the President of the University.

University of Georgia Foundation Why is the Foundation separate from UGA? The Foundation is a separate not-for-profit, 501(c)(3) corporation for very good reasons:  To receive tax deductible gifts under Section 170 of the Internal Revenue Code  Flexibility  More effective Investment Management  Donor Confidentiality

University of Georgia Foundation Why does UGA need gifts? Build endowment State appropriations are declining Gifts are vital to fill the gap Tuition remains low at UGA

University of Georgia Foundation Endowment Funds Reported to NACUBO – 2003 UGA$ 397,082,000 Michigan 3,464,515,000 Virginia 1,800,882,000 UNC 1,097,418,000 Indiana 941,068,000 Florida 585,695,000 Georgia Tech 729,926,000

University of Georgia Foundation Who sets fundraising priorities for UGA? The University of Georgia does. UGA’s President determines which of many fundraising proposals will become University priorities. Vice Presidents, deans and department and program heads set priorities for their units, within the context of University priorities.

University of Georgia Foundation What does the Foundation do with contributions? Exactly what the donors tell them to. The donor decides. Typically, 96-98% of gifts are “restricted” gifts which are designated for a particular school, college, department or program.

University of Georgia Foundation Who governs the Foundation? The Board of Trustees. The Board consists of 36 members including two ex-officio members. The President of the University is a voting ex-officio member and the President of the University of Georgia Alumni Association is a non-voting ex-officio member.

University of Georgia Foundation Committees Executive Finance Nominating Compensation Investment Audit & Governance Development & Public Affairs Foundation Fellows

University of Georgia Foundation How is the Foundation funded? The Foundation’s operating budget comes from 5 primary sources:  Unrestricted gifts  Management & administrative fees  Royalties  Unrestricted earnings  UGA Support

University of Georgia Foundation Unrestricted Revenue by Source For the Fiscal Year Ended June 30, 2004

University of Georgia Foundation How is the Foundation accountable? The Foundation openly discloses information about its policies, activities, financial statements, and other information. The following items are available to the public:  Financial audit  Annual report to donors  Policies on disbursement of gift funds  Investment policies, expenditure guidelines, and quarterly performance reports  Policies regarding the establishment of fund-raising priorities  Tax form 990

University of Georgia Foundation UGAF Website Includes: List of Trustees by Class Trustee Committee Assignments Audit Reports Policies and Procedures Manual

University of Georgia Foundation Policies & Procedures Manual Designed primarily for use by UGA unit heads and the Foundation administrative officers and staff. Information available includes:  What qualifies as a gift  How to transmit a gift  What information is needed for a fund agreement  How to expend Foundation funds  How to transfer funds to UGA  What is a spending budget  How to request unrestricted funds from the Foundation  What forms to use  How to read reports

University of Georgia Foundation UGAF Organizational Structure  University of Georgia Foundation UGA Alumni Association Costa Rica University of Georgia Real Estate Foundation  3 Limited Liability Corporations  Cortona

University of Georgia Foundation International Properties UGA at Oxford Center – Oxford England Purchased in 1999 by UGAF Provides housing for 28 students Total purchase price of $1.8 million Current annual rent $182,000

University of Georgia Foundation International Properties Ecolodge San Luis and Research Station – San Luis, Costa Rica Purchased in 2002 by UGAF Residential research & educational facility with accommodations for 85 people Total purchase price of $1.1 million with renovations & capital improvements of $0.6 million Current annual rent is $92,000

University of Georgia Foundation International Properties Casa di Riposi – Cortona, Italy Purchased in 2002 by UGAREF Provides housing for 40 students Total purchase price of $1.6 million with renovations & capital improvements of $0.8 million Annual rent will be $220,000

University of Georgia Foundation Total Assets As of June 30, 2004

University of Georgia Foundation Balance Sheet Asset Allocation As of June 30, 2004

UGA Real Estate Foundation Financial Position As of June 30, 2004

University of Georgia Foundation Total Revenue by Source For the Fiscal Year Ended June 30, 2004

University of Georgia Foundation Total Expenditures by Category For the Fiscal Year Ended June 30, 2004