Texas Property Code

§ 163.005 — APPROPRIATION FOR EXPENDITURE OR ACCUMULATION OF ENDOWMENT FUND; RULES OF CONSTRUCTION

PR § 163.005Title 10. MISCELLANEOUS BENEFICIAL PROPERTY INTERESTS · Part B. FIDUCIARIES · Ch. 163. MANAGEMENT, INVESTMENT, AND EXPENDITURE OF INSTITUTIONAL FUNDS

Statute text

View on source

(a)Subject to the intent of a donor expressed in the gift instrument and to Subsections (d) and (e), an institution may appropriate for expenditure or accumulate so much of an endowment fund as the institution determines is prudent for the uses, benefits, purposes, and duration for which the endowment fund is established. Unless stated otherwise in the gift instrument, the assets in an endowment fund are donor-restricted assets until appropriated for expenditure by the institution. In making a determination to appropriate or accumulate, the institution shall act in good faith, with the care that an ordinarily prudent person in a like position would exercise under similar circumstances, and shall consider, if relevant, the following factors:

(1)the duration and preservation of the endowment fund;

(2)the purposes of the institution and the endowment fund;

(3)general economic conditions;

(4)the possible effect of inflation or deflation;

(5)the expected total return from income and the appreciation of investments;

…

Legislative history

Acts 2007, 80th Leg., R.S., Ch. 834 (H.B. 860), Sec. 1, eff. September 1, 2007.