Restricted charitable gifts present increasingly difficult problems of compliance for the charitable recipient as time passes from the date of the gift. A restricted charitable gift is a contribution of money or property to charity with respect to which the donor specifies certain terms and conditions that govern the administration and application of the gifted assets. In contrast to restrictions that donors may place on gifts for private persons or uses, the law permits donor restrictions on charitable gifts to govern forever. The reason for this discrepancy is that gifts for charitable purposes must by definition inure to the public good. Society has thus struck a more conciliatory bargain with donors who contribute their property in furtherance of such public purposes. Societal concessions to charitable donors, in other words, permit these donors to exercise a degree of perpetual control over the use of contributed property in ways otherwise foreclosed by law.
As the warm glow that originally accompanied a donor’s charitable gift begins to fade with time, however, the circumstances and opportunities for public benefit that framed that gift also inevitably evolve. Over time, the donor’s restrictions may prove difficult for the recipient organization’s management to implement. Those restrictions might also fall out of line with society’s view of acceptable charitable objectives.
