Printed on: 04/24/2024. Please go to policy.umn.edu for the most current version of the document.
University of Minnesota  Administrative Policy

Classifying and Recording Sponsorships for University-Hosted Events/Activities

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Policy Statement

When planning events/activities, units often solicit financial support by offering sponsorship packages. Sponsorship packages are opportunities for an entity to monetarily support an event/activity and often include return benefits for the sponsoring entity. Examples of return benefits include any item of value, such as: a booth or table at an event/activity, tickets to an event/activity, advertising, or name and logo recognition.

Planned events/activities or programs can have a variety of names: fundraiser, conference, symposium, academic competition, non-credit course, program, lecture series, etc.

Sponsorships are beneficial to both the University community and the state of Minnesota when conducted in a manner consistent with the University’s mission of teaching, research, and outreach. Units may solicit sponsorships for a variety of reasons that support their mission. The accounting for sponsorship payments differs depending on the nature of the sponsorship. Units should contact [email protected] with questions or for review of sponsorship packages.

The University has the right to and will refuse sponsorships from unacceptable sources, and/or with an unacceptable message. Units must decline a sponsorship that

  1. is in conflict with University policies;
  2. adversely affects the University’s reputation;
  3. appears to create an endorsement by the University of a particular company, product, political candidate or position regarding public policies;
  4. is considered to contain obscene, indecent, or profane material; or
  5. ridicules, exploits, or discriminates against  persons on the basis of their social identities, including but not limited to: ability, faith, race, ethnicity, cultural identity/language, sexual orientation, gender identity, gender expression, socio-economic status, and national origin, etc.

Contact the Policy Owner if there are concerns related to accepting a sponsorship.

Units, on all campuses, that engage in planning events/activities or programs that involve soliciting sponsorships, paid registrations, and recognition activities must follow the classification requirements (see Appendix: Job Aid for Sponsorship for University-Hosted Events/Activities) and process set forth in this policy. Units must determine when a sponsorship is Gift Eligible and when it is Non-Gift Eligible in accordance with this policy.

  • Revenue from Gift Eligible sponsorships is directed to and deposited by the University of Minnesota Foundation (UMF). Units must review and reconcile the activity between the UMF fund and the University Chartfield String.
  • Revenue from Non-Gift Eligible sponsorships is directed to and deposited by units of the University.

Units must review and reconcile the activity in the University Chartfield String in accordance with Administrative Policy: Reconciling and Verifying General Ledger Accounts and Other Financial Information.

Reason for Policy

To support Board of Regents Policy: Gift Solicitation and Acceptance (PDF), Administrative Policy: Accepting and Managing Gifts and to ensure that sponsorship activity complies with federal Internal Revenue Service (IRS) regulations. The policy assists units in identification and classification of sponsorships, streamlining the process for handling sponsorship revenue, and accurately recording the revenue as either Gift Eligible or Non-Gift Eligible.

Contacts

SubjectContactPhoneEmail
Primary ContactSponsorship Classifications Group [email protected]
Gift relatedRoxanna Dreyer612-625-8887[email protected]
Accounting relatedMollie Viola612-625-0126[email protected]
Tax relatedKirsten Muller612-625-6036[email protected]
Responsible Individuals
Responsible Officer Policy Owner Primary Contact
  • Controller
  • Director of Accounting Services
  • See Contacts Table above

Definitions

[email protected]

A team of subject matter experts from UMF, Sponsored Projects Administration and External Sales that review transactions where units are unsure of how to classify a specific transaction or that has aspects of more than one type of transactions.

Events/Activities

Planned events/activities or programs can have a variety of names: fundraiser, conference, symposium, academic competition, non-credit course, programs, lecture series, etc. This policy applies to all types of planned events/activities, except for Membership or Consortium type arrangements. Membership/Consortium arrangements are classified as External Sales or Sponsored Projects. Contact [email protected] for determination and applicable policy.

Gift Eligible Sponsorship

A sponsorship where the financial or other support meets University guidelines for a sponsorship and the IRS guidelines for a charitable gift.

Fair Market Value

The value assigned to a benefit based on what the benefit would be reasonably sold for in today’s market; this is not actual costs incurred.

Membership/Consortium

Memberships that provide access to faculty, students, labs, experts, committee involvement, or academic programming that is specific to the membership population or is individual in nature dependent on the need/discipline. The membership group typically is formed to undertake an enterprise beyond the resources of any one member and is a relationship-building activity that typically lasts for a longer duration of time (for example: annual membership). Contact [email protected] for determination and applicable policy.

Non-Gift Eligible Sponsorship

A sponsorship where the financial or other support does not meet University guidelines for processing through UMF. Some portion of the sponsorship may be Unrelated Business Income (UBI). For detailed information on UBI, contact the University's Tax Management Office.

Return Benefit

Any item or service provided to a sponsor in return for the sponsor’s support, or sponsorship, of a University activity, event, or program. Examples may include, but are not limited to, a booth or table at an event/activity, tickets to an event/activity, advertising, name and logo recognition, or access to University services.

Sponsorship/Sponsorship Package

An agreement that implies the support of an event or activity by an entity. Return benefits may become an incentive or platform (or means) for recognition for an entity to make a contribution to UMF or payment to the University in support of an event/activity.

[email protected]

A team of subject matter experts from the UMF, the Tax Management Office and the Controller’s Office that review sponsorship packages and provide direction units based on the intent and desired outcomes of the event/activity.

 

Unrelated Business Income

Revenue-generating activities not directly related to the University ’s exempt purposes of research and discovery, teaching and learning, and outreach and public service. These revenues may be subject to federal and state unrelated business income tax (UBIT). Determining whether an activity is considered unrelated for UBIT purposes is based on federal laws, regulations, IRS guidance, and other opinions. For more information see the procedure Tax Considerations Pertaining to External Sales Transactions

U of M Access

A return benefit which includes the ability for a sponsor to access University faculty, staff, and students in an event or activity structured outside a sponsorship to facilitate things, such as: access to student resumes, recruitment, judging at venue, curriculum development, and projects with reportable outcomes.

Responsibilities

Capital Planning and Project Management

Provide oversight for sponsorships for building and/or internal spaces.

Chief Financial Managers/Clusters

Review and classify sponsorship programs appropriately. Ensure sponsorship packages are documented and any return benefits valued correctly. Ensure funds are deposited correctly, bills are created, and accounts reconciled in accordance with administrative financial policies.

[email protected]

Review transaction. Communicate or meet with unit to discuss details. Confer with other subject matter experts as appropriate. Provide a unit with a classification determination.

College and Campus Development Officers

Work with the UMF to formulate programs that meet fundraising objectives. Identify, cultivate, and solicit prospective donors/sponsorships. Create and classify sponsorship packages appropriately.

Controller’s Office

Define and provide guidance to units on classifying and handling sponsorship packages, including chart of accounts guidance and proper recording of transactions in PeopleSoft. Provide oversight for sponsorships for building and/or internal spaces.

[email protected]

Review sponsorship packages. Communicate or meet with a unit to discuss intent and desired outcome of the event/activity. Answer questions and provide options and recommendations based on the desired outcomes.

Tax Management Office

Define and provide guidance to units on classifying and handling sponsorship packages and special situations that may require an appropriate acknowledgment. Provide guidance in identifying UBI as a component of sponsorship packages. Provide oversight for sponsorships for building and/or internal spaces.

University of Minnesota Foundation

Define and provide guidance to units on classifying and handling sponsorship packages. Accept gifts to the University using established procedures. Transfer available gift funds to University accounts. Coordinate fundraising and maintain donor records. Provide oversight for sponsorships for building and/or internal spaces.

University Relations

Provide oversight for sponsorships for building and/or internal spaces.

Related Information

Board of Regents Policies

Administrative Policies

Other Related Information

History

Amended:

August 2022 - Comprehensive Review: Added language related to who to contact if there are concerns related to accepting a sponsorship from a potential unacceptable source and expanded the groups that might be ridiculed, exploited or discriminated against. Created a new appendix to assist units in determining a fair market value for the return benefits, added celebrity appearances, tours and certain types of swag bags as gift eligible return benefits, added a couple of frequently asked questions and other minor edits for clarification.

Effective:

January 2018 -  New Policy.  30 Day Review. 1. Provides the criteria to assist units in correctly classifying sponsorship revenue. 2. Specifies the correct process to follow, depending on the classification of the sponsorship revenue, which aligns with IRS guidance.