Spanos pledge: Sac State rules suggest partial write-down after five years

The fact that most of Alex Spanos’ $10 million pledge to Sacramento State University is still missing raises an interesting question: At what point would the school consider writing-down some of the pledge?

It is a procedural issue, but an important one. The public acknowledgement that a pledge did not come through entirely – or at all – is a familiar aspect of university fund-raising. Even in good economic times, up to $1 in every $5 of college fundraising pledges are typically is written down.  The write-down is a statement to the general public – and other donors – saying pledged funds are likely to never come in.

“We follow all CSU and CASE (Counsel for the Advancement and Support of Education) guidelines on gift reporting and pledge write-downs,” said Carole Hayashino, vice president for University Advancement, in an emailed statement. “Sacramento State’s 2010-2011 report will be out soon.”

The official pledge guidelines of the California State University system list two kinds of pledges. Unconditional pledges must be “legally binding,” according to the rules. The Spanos pledge would fit under the second classification, “conditional pledges,” which include “gifts for capital projects.”

According to the school’s own rules covering conditional pledges, they are to be “recorded” only “if there is a reasonable expectation that the promisor will deliver … and evidence suggests that promises are generally kept.”

Cal State fundraising guidelines call on all schools to set up their own “procedures for reviewing overdue pledges and designate an authority for writing-off inactive delinquent pledges.” The rules also call on schools to report long-term pledges in “five-year increments.”

While there does not appear to be a legally-binding commitment to do so, these rules suggest that Sac State should have written off up to $4 million of the pledge in their financials reported in the system’s “2009/2010 Philanthropic Annual Report.” Instead, it was the largest of five Cal State campuses to not write off anything for the fiscal year.

According to the 2010 Sacramento State Gift Procedures guide put out by the Office of University Advancement, “Donors will receive three reminders before a pledge on which no payments have been received is considered to have lapsed. Annually, pledges that are more than 90 days past due will be reviewed for write-off.”

The 23 CSU campuses are divided into three tiers based on size, age and resources. Group III consists of the four largest and oldest campuses—Fresno, Long Beach, San Diego and San Luis Obispo—while 11 are smaller, newer Group III campuses.

Sacramento is in the middle group, along with other urban campuses like Fullerton, San Francisco and San Jose. These schools all have between 10 and 20 fulltime fundraisers and endowments between $25 million and $50 million. Sac State’s endowment was $25.5 million as of last year.

In other words, the $10 million pledge was especially important for the school, which has been around only since 1947. Like many schools in the California State University system, it does not yet have a large list of wealthy alumni to keep it flush.

But at least one wealthy Sacramento State alumnus said he hasn’t really been asked.

“My relationship was with the old administration,” said Steven Lee Yamshon, a 1977 honors graduate who has become a successful asset manager in Newport Beach. “President Gonzalez has not really forged a relationship with me.”

For a couple years about a decade ago, the school’s on-campus alumni center was named after Yamshon, with his name on the outside wall. It was taken down about nine years ago, prompting speculation that he had backed out on a pledge.

Yamshon denied this, saying he had made good on every pledge he’s made to the school, the main one being $250,000 given over a five-year period several years ago. He said he requested the previous administration, headed by Donald Gerth, to take his name down because Yamshon said he wanted to protect his privacy and to keep the center from dominating the search results whenever anyone Googled his name.

The school declined to comment on Yamshon’s donations.

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