The Donor Who Helped Himself

It was too warm for September, Brad thought, as he drove down the long dirt lane through the pine trees to Sam’s house. He was glad for the coolness of the shade, and he knew that Sam would have the air conditioner going in his cottage. “Cottage” wasn’t exactly the word Brad would use for it. A year-round residence with all the amenities of a castle, Sam’s place was neatly camouflaged as a rustic summer residence most often found in the Upper Peninsula. Sam was one of the wealthier Buick dealers in this mid-Michigan urban complex, and he liked his comforts and gadgets right along with his rustic qualities.

This was Brad’s third visit to Sam’s domain and he was in pursuit of what appeared to be a fairly large planned gift to Torchlight for Children charity for which he was the major and planned gifts officer. He was anxious to wind up this negotiation and secure the gift, because he had worries in the back of his head that all was not as Sam was portraying it, yet he had nothing else to go on except Sam’s word and his enthusiasm for Torchlight.

What Sam wanted to do was set up a charitable remainder unitrust that would be funded now with a parcel of 50 acres of land Sam owned just inside the town’s geographic boundary, and at his death with the proceeds from an insurance policy on which his dealership was currently paying the premiums under its “key man insurance” benefit to him as its general manager. The unitrust, then, would continue for the life of his developmentally disabled son, Roger, to assist with his continued care and supervision. Brad had met Roger on his last visit with Sam and was impressed with the fact that despite his disability, his seven-year-old mind could produce some very insightful comments from time to time, and he had an engaging manner and dry sense of humor.

Brad knew it was a long shot to begin with, but Sam was a long-time board member of Torchlight for Children and an enthusiastic promoter and glad-hander of the charity throughout the community. Brad needed to respect Sam’s wishes and interest in making such a gift, but he also knew that Sam’s interest stemmed in part from his desire to lead the board in making long-term gifts and in part from his need to make sure that Roger was cared for. Sam also needed the tax deduction he would receive when he put the real estate into the trust.

One of the aspects of this gift negotiation that bothered Brad was that Sam was trying to make sure that he would have no outlay of money in setting up this gift. He had asked Brad to draw up the trust document himself, and didn’t want to engage an attorney. Brad, had, of course, declined that offer and insisted that it was Torchlight’s policy never to draft documents for donors. Sam would have to pony up for the lawyer if he wanted to make the gift.

But then there was the matter of the due diligence on the land parcel. Brad had suggested to Sam that he would need to have a level one EPA survey of the land’s content – a search for any contamination that might be present in the soil. But Sam was adamant that Torchlight should provide that $1000 service if they wanted to have this work done. And Brad knew that Torchlight’s policy forbade this – it was the donor’s responsibility to make sure that the gifted real estate was free of contamination of any sort. More than that, he knew that if the level one search turned up even the slightest touch of taint, then Sam would have to stand for a full level two review and Brad knew those were expensive and time-consuming propositions.

So that’s where the negotiation stood at the moment. Brad’s temples began to feel a little touchy as he rang the doorbell.

We'll return to Brad's donor visit tomorrow to see what happens next....