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Scholarship Fund Memorandum of Understanding

To be submitted with a Scholarship Fund Agreement.

This page is representative of our standard agreement. To customize for your client’s particular situation, please contact the Philanthropic Services staff at 860-548-1888 or giving@hfpg.org.

There are several options for supporting scholars through the Hartford Foundation. This memorandum is intended for use in the creation of a named fund within the Foundation's General Scholarship Endowment Fund. For more information about the other options, please visit Types of Funds, or contact the Philanthropic Services staff.

Memorandum of Understanding
Between
______________________

and
HFPG, Inc.
DATE

This Memorandum of Understanding is referenced in the Scholarship Fund Agreement between _______________ Scholarship Fund (the "Fund") and HFPG, Inc. dated _______, 200_. It further amplifies the intentions of ______________ and HPFG, Inc. regarding the Fund’s creation, purpose, and operations.

Scholar Selection Process
As stated in the Fund Agreement, HFPG, Inc. will annually select a scholar to benefit from this Fund from among a pool of applicants it recruits through its regular scholarship application process. This process consists of:

  • distributing printed and web-based application materials to all Greater Hartford area high school students (the Fund will be listed in these materials) and mailing award renewal applications to previous recipients,
  • contacting selected high-priority high schools directly, and
  • conducting one on one interviews with applicants.

It is understood that in its ongoing efforts to improve it’s Scholarship Program (of which the Fund is now part), HPFG, Inc. may change this process in the future.

Amount of the Annual Scholarship Award
The amount of the scholarship awarded from the Fund shall be determined annually by HFPG, Inc. It will not be less than the Fund’s annual income as determined by HFPG, Inc.’s spending policy, but HFPG, Inc. may supplement the Fund’s annual income to make an award greater than the Fund’s annual income.

HPFG, Inc. has adopted a spending policy to stabilize annual spending levels and to preserve the real value of the fund over time. Currently, the spending policy formula determines spending from funds at 5% of the average of the previous twenty quarters’ market value; however, spending is subject to a minimum of 4.25% and a maximum of 5.75% of the current fair market value of assets as of the beginning of the current fiscal year. This formula is subject to change at the discretion of HPFG, Inc.’s Board of Directors.

In 2005, each scholar in the scholarship program, including one benefiting from the Fund, will receive an award of $2,500. This amount may change in the future, but in the short-term it is anticipated, though not guaranteed, that the award amount will be in this range.

Payment of Scholarship Awards
HFPG, Inc. will manage all aspects of the administration of the scholarship award. This includes notifying the student of the award and making payment to the college upon proof of the student’s enrollment. No payments will be made directly to the student or his/her family. Payments will be made in accordance with the HPFG, Inc.’s policies, which currently allow awards to be used to reduce the amount of money students must pay for tuition, room, board, and routine fees as billed on an invoice from the college, or in some cases, for college loans from a variety of lenders.

Administrative Fees
The reasonable expenses of administration of the fund are charged annually to income and currently amount to 1.25% of fund value.

Fundraising Activities
While solicitation of individual contributions directly to a scholarship fund is permitted, no individual, organization or group may sponsor, promote or otherwise engage in any type of fundraising event or commercial activity for the direct benefit of a donor-advised fund.

Fund Reports
HFPG, Inc. will send a fund report semi-annually, showing net income for the fiscal year, beginning market value, contributions, investment return, grants awarded and ending balance. Interim fund balances are available from an advisor’s fund liaison or the Philanthropic Services Department’s Gift Manager.

By_____________________________________________________________
(signature) (print name) (date)

 

HFPG, Inc.:

By_____________________________________________________________
(signature) (print name) (date)

Its______________________________________________________________
(title)

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