In 2023, following the passage of the Donor Intent Protection Act in Kansas, Philanthropy Roundtable launched a monthly series on donor intent developments and controversies around the country to better inform those who care about this important topic. The Donor Intent Protection Act has now passed in Kentucky and Georgia as well, and efforts on behalf of this legislation continue in additional states.
This month’s Donor Intent Watch includes additional reporting on the treatment of race-specific scholarships at public universities – and now at least one private institution, an unusual example of sunsetting and an ongoing dispute about a proposed sale of art at Valparaiso University.
We encourage donors to contact us with any questions they have about our featured items and consult additional resources on donor intent at the Roundtable’s Donor Intent Hub. We also welcome any news about donor intent we may have missed.
Revisiting and Revising Race-Conscious Scholarships
In our previous Donor Intent Watch, we reported on the revision of race-conscious scholarships at public universities in Ohio, Missouri and Texas. The awards include both institutional funds and those funded by private donors. In some cases, universities are responding to state legislation banning diversity, equity and inclusion (DEI). In others, they are relying on guidance from their attorneys general who are extending to other areas the Supreme Court’s 2023 ruling on admissions in Students for Fair Admissions v. President and Fellows of Harvard College.
The Wisconsin system, The Washington Post recently reported, “is removing race as a factor in more than 160 scholarships, grants, fellowships, study abroad and hiring programs.”
Duke University, a private university, is also interpreting the Supreme Court decision to apply to financial aid and is rewriting the terms of race-conscious scholarships. In one instance, Duke is reallocating funding from a scholarship originally designated for Black undergraduates to support a new leadership program and increase need-based financial aid. On some campuses, alternate qualifiers are replacing racial designations to increase diversity, including “low-income,” “first-generation” and even ZIP codes.
Not all donors are satisfied with these changes, and we may soon see lawsuits claiming violations of donor intent. Nor is it clear that the courts will consider “workaround” language sufficient to avoid violating the Supreme Court ruling. As The Washington Post reminds its readers, Chief Justice Roberts warned, “[W]hat cannot be done directly cannot be done indirectly.”
Read more here.
Sunsetting at the Roy Lichtenstein Foundation
The news of Dorothy Lichtenstein’s death on July 4 brought to mind her 2018 announcement that the Roy Lichtenstein Foundation would sunset and was beginning to divest itself of its artwork. We first described the process in our guidebook, Protecting Your Legacy:
The Roy Lichtenstein Foundation chose the unusual spend-down path of liquidating a significant portion of its art collection by donating it to the Whitney Museum and the Smithsonian. Roy Lichtenstein was one of the 20th century’s most famous pop artists, known for his comic-book-style work. “I like the idea of handing it off,” his widow Dorothy Lichtenstein told The New York Times. “I don’t want to leave things up in the air.” The foundation is continuing to allocate its remaining artwork to museums in America and Europe. “We have always intended that the foundation, now almost 20 years old, would not operate in perpetuity, and are delighted we can create a new way forward with our first set of chosen successor institutions, well before we ‘sunset,’” Lichtenstein said.
In 2023, to celebrate the 100th anniversary of Roy Lichtenstein’s birth, the foundation donated 186 works to five museums: the Albertina in Vienna, the Colby College Museum of Art, the Nasher Museum of Art at Duke University, the Los Angeles County Museum of Art and the Whitney. The Dallas Museum of Art and the Nasher Sculpture Center were given 50 works to hold in common. The foundation’s projected date to complete the process is 2026, according to its executive director, Jack Cowart, noting the foundation still holds some artwork and approximately $40 million in cash.
The Continuing Art Sale Controversy at Valparaiso University
In our first Donor Intent Watch (May 2023), we reported on a lawsuit filed against the president of Valparaiso University contesting his proposed sale of three paintings to fund an upgrade of freshman dormitories. The paintings in question include “Rust Red Hills” by Georgia O’Keeffe (1930), “Mountain Landscape” by the Hudson River School’s Frederic E. Church (1865) and “The Silver Veil and the Golden Gate” by American impressionist Childe Hassam (1914).
All three acquisitions were funded by Percy H. Sloan through a trust he established in 1945 that contained 400 paintings and nearly $200,000 in cash. The work by Church was included in the estate transfer; the O’Keeffe and Hassam paintings were purchased by Richard Brauer in his role as museum director with funds from Sloan’s trust.
Brauer, one of the parties to the lawsuit, said the trust agreement requires the proceeds from the sale of any of its donated paintings to be reinvested in the museum and its collection. Several national museum organizations including the Association of Art Museum Directors and the American Alliance of Museums publicly opposed the proposed sale, as did Valparaiso’s faculty senate and many of its students.
With our update on the case in the August 2023 Donor Intent Watch, it appeared the sale might move forward when Indiana Attorney General Todd Rokita filed for dismissal of the lawsuit on the grounds that neither Brauer nor the second plaintiff, Philipp Brockington, had legal standing.
“The proper party to maintain litigation involving questions of public charitable trust,” Rokita added, is the attorney general’s office. Although a judicial decision dismissing the lawsuit was handed down in October 2023, the attorney general has not yet made his decision regarding the terms of Percy Sloan’s trust.
As the 2023-24 academic year ended in May, the university announced the closure of the Brauer Museum of Art. The reasons given included those already cited in 2023 by university President Jose Padilla – declining enrollment, a projected deficit and the need for ongoing dormitory modernization. But two new claims were added to a petition filed with the Porter County Court requesting approval of the sale of the O’Keeffe, Hassam and Church paintings.
First, the petition maintains the Sloan Trust had already been violated by former museum Director Richard Brauer when he purchased the O’Keefe and Hassam paintings, neither of which conform to Percy Sloan’s directive that any purchases made with funds from the trust be works “of the general character known as conservative.” Their sale would therefore right an earlier wrong.
Second, the petition cites the estimated $20 million value of all three paintings to be sold and warns that Valparaiso cannot afford to make the necessary security adjustments to protect those works from “activists [who] have, in recent years, taken to hurling soup and other harmful objects at classic art works.”
The petition also proposes using the proceeds from the sale to create a “gallery for the display of conservative art to students … in a practical setting,” with any excess proceeds supporting “the operating expenses of its dormitories and the gallery therein.”
To date, the Indiana attorney general has neither endorsed nor opposed the petition.
Read more here.
