Do we buy a fast food franchise or open our own burger joint?
As I see it.
The point is good food.
Like most of life, what’s the cost vs. benefits ratio?
Q,
…not Anon!
On Jan 13, 2021, at 11:44 AM, Bill Schwennsen (Redacted sender "schwbill" for
DMARC) <dmarc-noreply@xxxxxxxxxxxxx> wrote:
Thanks for this "front line" info on your experience Ed.
I suppose that another alternative for us would be to establish our own
501(c)3 account, and manage the fund ourselves. The cost to establish a (c)3
is pretty minimal. Once it is established, we could then send in money as
individuals for deposit into the account. We'd have to file a tax return
every year, but given our purpose and the amount of money that would be
coming in (not millions, but hey we'll take it) that wouldn't be a big deal
from an expense standpoint. Again, there would be some details to discuss as
a class about this course of action, but it would probably be the least
expensive, and also provide us the the most control over the fund money, how
it's managed, and how it's disbursed.
Just some additional food for thought.
BSch
-----Original Message-----
From: Edward Retta <eretta@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx>
To: fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx
Sent: Wed, Jan 13, 2021 11:27 am
Subject: [fighting_texas_aggie_band_class_of_1977] Re: Memorial Fund
Thanks guys for all this gum-shoe work.
I also do not want to denigrate the Foundation and all they do. Am glad they
exist. So this is off the record… But, with our TAMU Hispanic Network, we
learned the F was not always our friend, not easy to work with and pretty
controlling. As Bill has observed, lots of overhead… they were very
territorial about our donors and any new donor prospects we drummed up.
Didn’t share info in a collaborative way, but I understand reasons why. Not a
criticism, just an observation. We eventually kept our own accounts and
regional Hispanic Aggie groups are free to raise money and give it away by
total local control.
Basically, we had lots of challenges in the beginning, with the various
bureaucracies in the systems, not just the F., the AFS was also a challenge
to navigate. They opposed our formation at first, now we are an official
sub-set of AFS.
I would be just as happy to donate money into our own, managed fund, with or
without "on campus” officialdom, and channel as much as we can to BQ cadets.
But, I will support the collective will of our group.
Edward Retta
crossculturecommunications.com
linkedin.com/in/edwardretta/
+ 1 214 394 3000 (GMT - 6)
world phone 44 772 543 6501
eretta@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
On Jan 13, 2021, at 10:13 AM, DANNY POPHIN <danpophin@xxxxxxx> wrote:
I have to agree with Bill's assessment. This seems to be a hefty fee for
what we are trying to accomplish here. And if we are restricted to only
giving a scholarship/gift to a BQ, the 4% on the gain for the year is not
much.
Dan
From:
fighting_texas_aggie_band_class_of_1977-bounce@xxxxxxxxxxxxx<fighting_texas_aggie_band_class_of_1977-bounce@xxxxxxxxxxxxx>
on behalf of Bill Schwennsen <dmarc-noreply@xxxxxxxxxxxxx>
Sent: Wednesday, January 13, 2021 11:08 AM
To:
fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx<fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx>
Subject: [fighting_texas_aggie_band_class_of_1977] Re: Memorial Fund
Dean, thanks for sending the PDF. Here's how I see it:
The 5% "gift tax" is taken from the earnings on the gift, not from the
principal itself. This "tax" is taken, in our case, after the total of
gifts to our account meets or exceeds $25,000. Since the tax at 5% is more
than the annual scholarship payout of 4%, you can surmise that, once we meet
the $25K goal, it will still be 18 months, to maybe 2 years, before the
first scholarship disbursement is actually made. The faster we get to, or
exceed, the $25K minimum threshold, the sooner that we can start chipping
away at that "gift tax', get that satisfied, and start the clock on
accumulating enough earnings in the account to actually pay a scholarship.
If the Class will allow me an opinion here.... the Foundation does a great
job, but this 5% tax they put on gifts can be (and has been with some Aggies
I know) a deterrent for some potential donors. They are professional fund
raisers, and employ professional money managers (either directly or by
contract). That's a lot of overhead to cover. The 1% annual expense fee is
supposed to cover year-to-year operating expenses, and I'm sure it does...
but that begs the question of what the 5% gift tax is used for. I don't
know... I could speculate but I won't. I'm not in any way downing the
Foundation here, but we're trying to raise what is, for them, a pretty
modest amount of money and I think we need to make sure we as a Class are
happy with whatever arrangements are made.
Those of you who attended the 125 year BQ reunion in '19 might have heard
the TABA Prez at the time talk about the TABA establishing their own fund to
throw off income that could be used for scholarships for the Band, or
possibly other purposes benefitting the FTAB. The TABA runs their money
through the Corps of Cadets Association (CCA).. The CCA manages the TABA's
demand accounts for them. Although the CCA has overhead expenses also, they
do NOT charge any sort of "gift tax" that I'm aware of. I believe that Rick
Ashley and Tom Henry are both in TABA leadership positions; it might be
worth reaching out to them to see if the TABA/CCA have a vehicle that we
might use in establishing our account and what the details are. Again, I'm
not trying to pit one organization against the other (TABA/CCA vs
Foundation), I'm just trying to point out that their might be another avenue
worth checking out before we all start writing checks.
Knowledge is power, and also usually makes for happy donors (and investors).
I hope all of you are well and are managing to avoid the Covid.
BSch
-----Original Message-----
From: Dean B <canyonag77@xxxxxxxxxxx>
To: fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx
<fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx>
Sent: Wed, Jan 13, 2021 9:45 am
Subject: [fighting_texas_aggie_band_class_of_1977] Re: Memorial Fund
You finance whizzes can read the PDF and correct me, but to give my reading
of the Foundation's policy:
The Foundation does not take money from the donation principal.
They collect a one-time fee equal to 5% of the donation, they collect that
from the gains on the donation.
They collect a yearly management fee of 1%, again from the gains, not from
the endowment principal.
The award to the recipient is 4% of the gain on the account. I'm not sure
if gains in excess of the 4% award and 1% fee go back into "our" account.
From:
fighting_texas_aggie_band_class_of_1977-bounce@xxxxxxxxxxxxx<fighting_texas_aggie_band_class_of_1977-bounce@xxxxxxxxxxxxx>
on behalf of Dean B <canyonag77@xxxxxxxxxxx>
Sent: Wednesday, January 13, 2021 9:09 AM
To:
fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx<fighting_texas_aggie_band_class_of_1977@xxxxxxxxxxxxx>
Subject: [fighting_texas_aggie_band_class_of_1977] Re: Memorial Fund
You are correct, Bill.
https://cdn.txamfoundation.com/How%20to%20give/The%20Gift%20Process/EXHIBIT_A_Effective_7-1-2020.pdf
