Uniform Prudent Management of Institutional Funds Act

The Uniform Prudent Management of Institutional Funds Act (UPMIFA) was enacted by the Maine Legislature to apply to funds existing on or established after July 1, 2009. The new law permits expenditure from endowed funds even if the fund’s value is less than its historic dollar value. Most donors who created endowed funds with the Foundation signed fund descriptions or gift agreements indicating that the “principal shall be endowed and only the income, as established by the University of Maine Foundation Board of Directors, shall be used . . .”

At the August 18, 2009 meeting of the Foundation’s Board of Directors, the Board passed a resolution that says,

“At this time, the Board of Directors believes that the donors who established endowed funds with the Foundation intended to create funds according to the dictionary definition of endowment, meaning that the principal of the fund would not be invaded for distribution. Although donors who create new funds will have the option of creating a fund in which principal may be invaded, the funds endowed in the Foundation on or before July 1, 2009 will not be expended if the fund’s value is less than its historic dollar value, in accordance with the Foundation’s spending policy.”

If you have questions about UPMIFA, the Foundation’s policy, or how UPMIFA impacts a fund that you individually established, please contact Amos E. Orcutt, President/CEO of the Foundation at 207.581.5100.