14% of the Massachusetts work force is employed by non-profits. UPMIFA will free funds to provide charities operating cash to maintain jobs and services. The non-profit sector is already shedding jobs, and Massachusetts Advocates for the Arts, Sciences and Humanities (MAASH) is asking the Legislature to pass UPMIFA before July 1 to halt imminent layoffs.
Click here to visit MAASH and learn more about UPMIFA advocacy options!
The UPMIFA would replace the Uniform Management of Institutional Funds Act (UMIFA), which was instituted almost 35 years ago by The National Conference of Commissioners on Uniform State Laws.
At the time of its instituion, UMIFA provided guidance and authority to charitable organizations within its scope concerning the management and investment of funds held by those organizations. UMIFA provided endowment spending rules that did not depend on trust accounting principles of income and principal, and UMIFA permitted the release of restrictions on the use or management of funds under certain circumstances. The changes UMIFA made to the law permitted charitable organizations to use modern investment techniques such as total-return investing and to determine endowment fund spending based on spending rates rather than on determinations of “income” and “principal.”
The new Act provides modern articulations of the prudence standards for the management and investment of charitable funds and for endowment spending. The Uniform Prudent Investor Act (UPIA), an Act promulgated in 1994 and already enacted in 43 jurisdictions, served as a model for many of the revisions. UPIA updates rules on investment decision making for trusts, including charitable trusts, and imposes additional duties on trustees for the protection of beneficiaries. UPMIFA applies these rules and duties to charities organized as nonprofit
corporations. UPMIFA does not apply to trusts managed by corporate and other fiduciaries that
are not charities, because UPIA provides management and investment standards for those trusts.
UPMIFA has already been adopted by 34 states with pending legislation in 12 others. Drafted by the national Uniform Law Commission, UPMIFA is endorsed by the American Bar Association, The National Conference of Commissioners on Uniform State Laws, and The National Association of College and University Business Officers.
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Today the Massachusetts House of Representatives voted unanimously in favor of the Uniform Prudent Management of Institutional Funds Act (UPMIFA), Senate Bill 2078. In order to provide relief immediately, the Governor must sign the bill by midnight tonight! Visit MAASH.org and click on advocay tools to learn more!
Yesterday, the governor signed the bill instituting UPMIFA. MAASH reports that their advocates generated 1149 e-mails to the Governor and Lt. Governor urging swift action on UPMIFA to save non-profit jobs. Massachusetts is the 35th state in the Union to adopt UPMIFA.