Uniform Prudent Management of Institutional Funds Act

The Uniform Prudent Management of Institutional Funds Act (UPMIFA) is a uniform act that provides guidance on investment decisions and endowment expenditures for nonprofit and charitable organizations. As of 2012[1] UPMIFA is the law in 49 states, the District of Columbia and the U.S. Virgin Islands.[2] Neither Pennsylvania[3] nor Puerto Rico[1] has adopted UPMIFA.

The major change in UPMIFA compared to the previous model law (the Uniform Management of Institutional Funds Act) is that it replaces a requirement that nonprofits cannot spend below the original value of contributions or "historic dollar value" (HDV) with a new requirement that their investing and spending will be at a rate that will preserve the purchasing power of the principal over the long term.

The act also enshrines a "charitable purpose doctrine" into law, noting that investors must consider an investment's relationship with their broader social mission.[4]

  1. ^ a b "Mississippi newest state to enact UPMIFA". Archived from the original on 2016-03-04. Retrieved 2014-07-21.
  2. ^ "Legislative Fact Sheet - Prudent Management of Institutional Funds Act". Archived from the original on 2015-03-30. Retrieved 2014-07-21.
  3. ^ "UNIVERSITY OF PENNSYLVANIA FINANCIAL REPORT 2012-2013" (PDF). Archived from the original (PDF) on 2014-07-29. Retrieved 2014-07-21.
  4. ^ "UNIFORM PRUDENT MANAGEMENT OF INSTITUTIONAL FUNDS ACT". NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS.