University Policies and Procedures Manual (previously Business Policies and Procedures Manual)

UPPM 30.78

For more information contact:
   Finance and Operations
   509-335-5524 / VPFA@wsu.edu

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1.0   Policy

When the University invests otherwise spendable gift funds in the Consolidated Endowment Fund for the purpose of producing long-term spendable income, such a fund is called a quasi endowment.

A quasi endowment is established by the Executive Vice President for Finance and Operations when they determine that establishment of such a fund is beneficial to the University.

Quasi endowments (sometimes referred to as funds functioning as endowments) are granted to units within the University for the purpose of converting currently spendable assets into invested assets that will produce future on-going support of a University program.

Generally, a quasi endowment is not established unless the initial principal will remain in the Consolidated Endowment Fund for at least three years.

Quasi endowments are subject to the same management and distribution policies and fee schedule of the WSU Foundation (WSUF) as applicable to true endowment funds and approved from time to time by the WSUF Board of Directors.

Note: The Consolidated Endowment Fund is a commingled pool of private gifts invested by WSUF to maximize return on investments within an acceptable risk profile and among diverse asset classes in providing a perpetual source of funding for WSU’s educational mission.

2.0   Requirements

The Executive Vice President for Finance and Operations designates a  quasi endowment for the uses specified in the underlying  gift use agreement document or, in the absence of donor restrictions, for the purposes specified by the requesting unit (see also UPPM 30.75).

A minimum of $100,000 is required to establish a quasi endowment. Once established, distributions from the quasi endowment are spent in accordance with its governing instrument (e.g., gift use agreement, term sheet, or other written documentation). Changes to the governing instrument of a quasi endowment or spending of its “principal” require the approval of the Executive Vice President for Finance and Operations.

By the nature of the financial resources used to create a quasi endowment, only the Executive Vice President for Finance and Operations as treasurer for the Board of Regents can create a quasi endowment. All quasi endowments are assets of the University and, for investment purposes, are treated like all other University endowments.

2.1     Management and Advancement Fee

Quasi endowments are subject to the same distributions (i.e., annual spending rate) as applicable for true endowments, consisting of the funds’ restricted purpose amount and WSUF management and advancement fee.

Note: The management and advancement fee is an asset-based fee that is paid to WSUF out of the Consolidated Endowment Fund’s earnings to cover a portion of the salaries and operating costs associated with the services that the WSUF provides to WSU.

2.2     Expendable Resource

For financial reporting purposes, all investments of quasi endowments are considered expendable resources.

2.3     Distribution Schedule

Distributions are made subject to the distribution and fee schedule as approved by the WSUF Board of Directors and WSU Board of Regents.

3.0   Procedures

3.1     Establishment

Requests for establishment of, or additions to, a quasi endowment must be made through a dean, vice president, chancellor, or unit head (e.g., Athletic Director, center head, etc.).

The applicable official submits the request to the Vice President for Finance and Business Services requesting establishment of, or addition to, a quasi endowment. The request memorandum must contain at least the following information:

• Dollar amount of request and source of funds.
• Proposed name of the quasi endowment.
• Terms of the approved draft gift use agreement, which includes uses and purposes for utilization(s) of distributions.
• Name of the administrator of the fund.
• Name, telephone, and e-mail address of the departmental contact for questions.

The Vice President for Finance and Business Services reviews the request in coordination with Treasury Services and recommends approval or disapproval to the Executive Vice President for Finance and Operations.

If approved by the Executive Vice President for Finance and Operations, Finance and Operations and the WSU Foundation work with the requesting unit to set up the necessary accounts and funds transfers. If not approved, the Vice President for Finance and Business Services notifies the requesting unit in writing.

Following approval by the Executive Vice President for Finance and Operations, WSUF initiates a separate gift identification number (ID) in the WSUF donor management system in the name of the fund being established. The quasi endowment gift use agreement must be signed by the:

• Requesting department director;
• Requesting dean, vice president, or chancellor;
• WSUF Senior Associate Vice President, and
• Executive Vice President for Finance and Operations.

3.2     Terminations

Requests for withdrawal or termination of a quasi endowment must be made through the responsible dean, vice president or chancellor. The request is in the form of a memorandum to the Vice President for Finance and Business Services requesting termination of or withdrawal from a quasi endowment.

The request for withdrawal or termination must be submitted to the Vice President for Finance and Business Services at least six months prior to the anticipated withdrawal or termination date. The memorandum must contain at least the following information:

• Dollar amount of the request and the purpose of withdrawal, which must be consistent with the Gift Use Agreement.  Attach a copy of the agreement to the request.
• Name, telephone, and e-mail address of the departmental contact for questions.

The Vice President for Finance and Business Services reviews the request and recommends approval or disapproval to the Executive Vice President for Finance and Operations. Finance and Operations coordinates the request with the WSUF Finance Office.

If approved,  Finance and Operations and the WSU Foundation works with the requesting unit to implement the withdrawal or termination and transfer funds. If not approved, the Vice President for Finance and Business Services notifies the unit in writing.

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Revisions:  Aug. 2025 (Editorial); Nov. 2024 (Rev. 637); Nov. 2008 – new policy (Rev. 330)