Planned Giving & Trust Service (PGTS) organizations continually discuss the requirements for Seventh-day Adventist organizations to be involved in preparing estate planning documents for their donors. Some require specific percentages, such as 10% or 25%. Others do not require any charitable intent and view their service as relationship-building with the donors. How does your organization handle donor intent requirements? Below is the standard that addresses charitable intent.
Standard 46 – Substantial Benefit
Trust agreements when the organization is trustee or successor trustee are written only when the denomination will substantially benefit from such agreements, with the nature of the assets, size of the estate, cost of servicing the trust, and other factors being considered in determining the feasibility of entering into such agreements. (NADWP S 40 50) [PGTS]
The operative words that are used in standard #46 are trust agreement, trustee and successor trustee. Please note there is no mention of a personal representative or attorney-in-fact. It refers specifically to revocable trusts and self-administered trusts where the organization has accepted current or future fiduciary responsibilities.
Please allow me to share my experience. My wife and I have had an estate plan since three months after we were married. We worked with our local conference to prepare our first plan. After several revisions, we asked the conference to create a self-administered trust. We were told we would need to give the conference 10% of the distribution for them to create the trust.
I love my church, and one of my spiritual gifts is giving. I love to give to my church. But when I was told that I was required to give 10%, a spirit of rebellion welled up in my heart. Thanks to the Holy Spirit, that rebellion did not surface. I compliantly agreed and moved on, and the conference received the required 10%. [1] In previous estate plan documents, the organization received more than 10%.
That experience is still vivid in my mind and has given me pause as I consider how the organizations that I work for should relate to requiring specific amounts from donors. The questions I ask are, do we lose donations because of our PGTS distribution requirement? Are we losing more than we gain by this requirement? Answers to these questions are difficult to determine objectively.
From my experience, I believe that more is gained with an open hand than with a clenched fist. The open hand represents letting the donor choose what to give. The clenched fist represents a required amount with which the donor must comply.
At one Adventist organization where I worked, we had a policy that charitable intent to our organization was required, and the donor was able to choose that amount. During 12 years of working with this policy, there were only three people who refused charitable intent for this particular organization. We still worked with these people to complete an attorney questionnaire intake form and then hand it to them while communicating that we saved them several hours of attorney billable time. I can count on one hand the number of donors who gave less than or only 10% to our organization. In fact, we experienced more giving 20%, 30%, and as much as 40%.
So, what about requiring donors to comply with a specified amount to receive service from your organization? Let me share a telephone call I received at the end of 2023.
The call came from a missionary physician who was home on annual leave in December 2023 and wanted to know his options since the conference he contacted about creating an estate plan for their family required a minimum 10% distribution to their organization to create a last will and testament. This Loma Linda University graduate had spent the years since graduation working outside the USA, providing health care in under-serviced areas of the world, andhe wanted to support some of these Seventh-day Adventist locales. This donor was lost to that particular PGTS organization because of their distribution requirements. It was not because the donor didn’t want to give to the Seventh-day Adventist Church; he wanted it directed in another way.
Indeed, donors always have a choice; they can go to an attorney of their choice and pay to create an estate plan that does whatever they choose for their families. When this happens the requiring organization loses the relationship with the family, the word-of-mouth recommendations, as well as the required distribution.
It is true that a clenched fist will not lose what is inside, but neither can any additional get in. An open hand will more than likely have some spillage, but more can be put in easily.
“Rather, be openhanded and freely lend them whatever they need.” Deuteronomy 15:8 NIV
Research
Washington Conference charitable intent requirement to SDA organization.
From NIV
Deu 15:7 If anyone is poor among your fellow Israelites in any of the towns of the land the LORD your God is giving you, do not be hardhearted or tightfisted toward them.
Deu 15:8 Rather, be openhanded and freely lend them whatever they need.
Deu 15:9 Be careful not to harbor this wicked thought: “The seventh year, the year for canceling debts, is near,” so that you do not show ill will toward the needy among your fellow Israelites and give them nothing. They may then appeal to the LORD against you, and you will be found guilty of sin.
Deu 15:10 Give generously to them and do so without a grudging heart; then because of this the LORD your God will bless you in all your work and in everything you put your hand to.
Deu 15:11 There will always be poor people in the land. Therefore I command you to be openhanded toward your fellow Israelites who are poor and needy in your land.