Designated Permanent Scholarship Program

Upon receipt of cash or other liquid assets designated for scholastic or leadership development use, it is the intent of the Foundation to hold these funds in trust for the use specified with the following conditions:

The minimum contributions to establish a fully-funded scholarship account to be administered by the TKE Educational Foundation is defined by when the scholarship was started. Scholarships started prior to April 2016, the minimum balance is $5,000. Any scholarship started after April 2016, the minimum balance is $10,000.

Annual scholarship awards

Annual scholarships for all fund accounts reaching fully-funded status will be awarded in a percent of earnings amount as determined annually by the Board of the TKE Educational Foundation based upon the designated scholarship fund balance from the previous fiscal year as audited. As temporary restricted funds, the corpus of any fund may be invaded for the purpose of making authorized awards, at the discretion of the Board of Directors.

Other distributions

Any portion of the annual approved award allocation may also be designated for educational purposes other than scholarship awards; i.e., Conclave, Regional Leadership Conferences, Leadership Academy or other educational conferences.

Although there is no time limit to the period to attain sufficient contributions for a fund to reach the required minimal capital investment, the Board of Directors of the TKE Educational Foundation reserves the right to review any fund activity on a periodic basis. The Board has the discretion to declare an inactive fund terminated, should it be judged that it is unlikely the fund will ever reach fully funded status. Any assets existing in the fund at this time will be released to the TEF undesignated scholarship general fund and be utilized for other educational or academic purposes.

Grants and/or scholarships may be awarded for those established funds having been in existence and invested for at least one year or if accumulated earnings are sufficient to meet the minimum scholarship award of $200.00.

Most grant and/or scholarship recipients will be selected by the Board of Advisors of the designated chapter or other recognized alumni authority, or by the Awards Committee of the Foundation as determined by the President/CEO for those funds not designated for a chapter.

Investment earnings or losses (realized or unrealized) on designated funds in excess of the grants and/or scholarships awarded for the year will be allocated to the fund’s corpus.

When reinvested earnings and/or additional contributions have accumulated to an amount sufficient to fund an additional grant and/or scholarship, the present grant and/or scholarship may be increased or an additional grant and/or scholarship may be awarded.

All scholarship contributions are assessed a 3% administration fee on the principal of the account on June 1. Total assets will be determined by audit report as of the end of the previous fiscal year. In addition, pro-rata bank and investment fees shall be charged against each individual fund.

It shall also be the policy of TEF to retain in reserve 1-3% of fund earnings within the fund corpus, whenever possible, as inflation protection, and/or to cover awards in years when the funds may experience an investment loss.

For each designated fund, where possible, one individual will be required to be named as the “official contact” between the chapter (undergraduate and alumni) and the Foundation. The Foundation will provide the “official contact” with an annual status report on the designated fund, which will be available after completion of the Foundation’s previous year audit.

At the time that a contribution is received indicating that a designated fund is in the planning stages of being established, the contributor(s) will be asked to sign a “Memorandum of Intent” agreeing to the policies of the Foundation and outlining the plan to reach the appropriate level to establish a designated scholarship. Although there is no minimum period within which a designated fund must meet fully funded status, the Foundation Board reserves the right to review the status of any pending funds at any time, and may, in its judgment, reallocate the assets of such funds for what may be deemed the most effective academic use and benefit.

Accounting Procedures for Designated Funds

TEF will maintain individual accounts by annual audited statement showing:

Contributions received
Earnings for the year (including realized or unrealized gains or losses)
Fees charged
Grants/Scholarships awarded
Amount available for current year award activity

One combined account will be maintained for those designated funds that have not reached the minimum required capital amount. At the time any designated fund in this account reaches the minimum capital amount, it shall be transferred to its individual designated fund. Only those contributions specifically identified by the donor for the individual fund will be designated as such. Any such contributions cannot be reclassified for designated purposes once received and acknowledged by the Foundation.