[§517E-4]  Appropriation for expenditure or
accumulation of endowment fund; rules of construction.  (a)  Subject to the
intent of a donor expressed in the gift instrument, an institution may
appropriate for expenditure or accumulate so much of an endowment fund as the
institution determines is prudent for the uses, benefits, purposes, and
duration for which the endowment fund is established.  Unless stated otherwise
in the gift instrument, the assets in an endowment fund shall be
donor-restricted assets until appropriated for expenditure by the institution. 
In making a determination to appropriate or accumulate, the institution shall
act in good faith, with the care that an ordinarily prudent person in a like
position would exercise under similar circumstances, and shall consider, if
relevant, the following factors:



(1)  The duration and preservation of the endowment
fund;



(2)  The purposes of the institution and the endowment
fund;



(3)  General economic conditions;



(4)  The possible effect of inflation or deflation;



(5)  The expected total return from income and the
appreciation of investments;



(6)  Other resources of the institution; and



(7)  The investment policy of the institution.



(b)  To limit the authority to appropriate for
expenditure or accumulate under subsection (a), a gift instrument shall
specifically state the limitation.



(c)  Terms in a gift instrument designating a
gift as an endowment, or a direction or authorization in the gift instrument to
use only "income", "interest", "dividends", or "rents,
issues, or profits", or "to preserve the principal intact", or
words of similar import:



(1)  Create an endowment fund of permanent duration
unless other language in the gift instrument limits the duration or purpose of
the fund; and



(2)  Do not otherwise limit the authority to
appropriate for expenditure or accumulate under subsection (a). [L 2009, c 135,
pt of §1]