Chapter Educational Fund
- What is a Chapter Educational Fund (CEF)?
In response to alumni demand for a tax-deductible option to provide financial support to their local chapters, the Sigma Pi Educational Foundation (the Foundation), in consultation with Sigma Pi Fraternity, has developed the Chapter Educational Fund (CEF) Program.
Unlike the Foundation, local chapters and housing corporations are not tax-exempt under section 501 (c) (3) of the Internal Revenue Code. As such, alumni that provide direct financial support to local chapters and housing corporations are not permitted to receive the benefit of any tax deductions. The CEF Program allows donors to make charitable gifts that specifically and directly address the needs of their local chapter.
The alumni members of any active or dormant chapter (including the members of any colony) of Sigma Pi Fraternity are welcome to establish a CEF with the Foundation. The Foundation will manage all gifts to the CEF as restricted gifts for the sole benefit of the chapter and its members.
- How does it work?
The Foundation has the power to establish a separate investment account for each chapter, colony and alumni association of Sigma Pi. The contributions can be designated for a specific chapter or colony and alumni association and used for qualifying educational or charitable uses.
Requests for funds require the chapter’s CEF Local Advisory Committee (LAC) and the Foundation Scholarships & Grants Committee to approve the use and confirm that the request meets a qualified charitable use. No funds will be disbursed from the CEF account without the request of the LAC and the approval of the Foundation. To receive the final payment of the grant or scholarship, the LAC must provide the Foundation a request form and with copies of invoices or other documentation supporting the amount of the payment request.
The funds can provide scholarships on behalf of any chapter, colony, or alumni association of Sigma Pi Fraternity. They can assist interested chapters in creating and administering scholarship programs. Scholarship awards are not limited to members of the Fraternity; scholarships can be provided to any member of the general public.
- What can the CEF money be used for?
The typical support the Foundation provides takes four forms:
- Service projects and support for qualified charities
- House construction and renovation
- Educational scholarships for post-secondary education
- Educational scholarships may be based on academic merit, leadership potential, community service activities, or financial need.
- Scholarship recipients must be enrolled in an accredited post-secondary education programs including technical schools, undergraduate programs, graduate programs, doctoral programs, and seminary schools
- Educational grants
- CEF can provide grants for registration fees, presenters, facility rental, travel, lodging, supplies and related expenses for educational and leadership skills events and activities
- Who provides the financial support to fund a CEF?
The Foundation has received CEF donations from all of the following constituencies: alumni who graduated from the local chapter, alumni living within proximity to the local chapter, parents of new members and undergraduate members, previous scholarship award recipients from the local chapter, friends of Sigma Pi Fraternity, and local businesses providing services to the local chapter, among others.
- Who determines which requests the CEF will fund?
The Foundation shall receive advice and guidance from a Local Advisory Committee (LAC) selected by the Chapter, consisting of at least three (3) members, one (1) of whom serving as Chairman. The Committee shall provide general advice to the Foundation as to the disbursements and administration of the CEF; however, the Foundation shall retain ultimate decision-making authority as to all matters related to the CEF. The LAC shall determine how and when its members are selected and update the Foundation as to its membership, with contact names, phone numbers, and email address annually and within thirty (30) days of any changes.
- Does a CEF accrue earnings and grow over time?
Yes. The CEF account is maintained in a fixed income account (money market, savings, or certificate of deposit) until it grows to $10,000, the required minimum threshold to request disbursements. Once the CEF account reaches $10,000, the LAC is then able to request that the CEF funds be moved into a managed investment account. While the LAC members are welcome to submit suggestions on investment strategies, discretion as to the specific investment allocation of these managed accounts must be maintained by the Foundation’s Board of Trustees.
- Are there any fees associated with the CEF program?
Yes. In addition to any direct expenses incurred with respect to the CEF (for example, but without limitation, Brokerage Costs as defined below), the standard annual fee of two percent (2.00%) of the fund balance will be assessed by the Foundation (the “Management Fee”). The Management Fee shall be based upon the balance of the CEF account at the end of the Foundation’s fiscal year. The Management Fee shall be automatically deducted from the CEF balance at the time of assessment. At such time as the CEF balance shall reach thresholds as defined in the Foundation’s High Value Fund Policy, as amended, the Management Fee shall be discounted accordingly.
- What is the minimum gift size that can be made to a CEF account?
There is no minimum gift size. Younger alumni members may choose to support their local chapter by donating $18.97 to the local CEF account. Other, more established alumni members may choose to make long-term gifts through an executed gift agreement with the Foundation. If you are interested in different gift options, please contact the Foundation at SPEF@sigmapi.org.
- What happens to a CEF if the local chapter is closed?
If the Chapter closes, the CEF shall maintain all funds to benefit a recolonized Chapter, should it occur. If Chapter re-colonization does not occur within ten (10) years, the entire CEF balance may be transferred into the Foundation’s general fund.
- What is the minimum CEF account size?
To establish the CEF account, the Chapter shall submit to the Foundation, within ten (10) days of the Effective Date, an initial deposit of at least $1,000. A failure to submit the initial deposit within the time required will render this Agreement null and void. Within three (3) years of the Effective Date, the total balance of the CEF account must be at least $10,000. If the Chapter has failed to fully fund the CEF within the three-year timeframe, there will be a collaborative meeting between the LAC and the Foundation, to determine a possible extension of the deadline, and plan for future funding of the CEF, or the winding down of the CEF if necessary, in accordance with all applicable federal and state laws. Absent an extension, the CEF must maintain a fund balance of $10,000 dollars at all times after the initial three-year period