(A) The Town Council has the option and responsibility to either accept or reject, in writing, any proposed donation. If the donation is a restricted donation, the Council must agree, in writing, to the terms, conditions, or purposes attached to the proposed donation. Restricted donations can only be accepted for purposes within the scope of general statutory authority.
(B) Donations which are accepted must be handled in the following manner.
(1) Unrestricted donations shall be receipted into the Town General Fund. Expenditure of such donated revenue from the operating fund shall be made only after an appropriation has been provided for the purpose of the expenditure. Claims must be filed and approved in the regular legal manner.
(2) A restricted donation shall be placed into a separate fund after such fund is established by the Council. Any appropriate descriptive name may be given the donation fund. The donation can be expended only for the purpose and under the terms and conditions agreed to on accepting the donation.
(a) Pursuant to Attorney General Official Opinion No. 68 of 1961, no further appropriation is required for expenditure of a restricted donation for the designated purpose. Even though no further appropriation is required, claims must be filed and approved in the regular legal manner before disbursements can be made from the fund.
(b) If the volume of restricted donations justifies it, a “control” fund may be established for all restricted donations. Separate, individual accounts would then be established to account for each restricted donation or each type of restricted donation. The total activities of the separate accounts: receipts, disbursements, balances, should be reflected on the control fund.
(c) Income from investments of restricted donations should be receipted into the same fund in which the principal of the donation has been receipted, provided it is to be used for the same purpose as the principal. However, if under the terms of the donation agreement, the principal must be held in trust in perpetuity and only the income used by the town, there should be two funds established. One fund should be designated as “trust interest.” In this situation, expenditures would only be permitted from the Trust Interest (Income) Fund.
(Ord. 2020-12, passed 12-17-2020)