Section 13-03-22-17 - Charitable donation accountsCredit unions may invest in charitable donation accounts provided:
1. The charitable donation account is structured as a hybrid charitable and investment vehicle used to provide charitable contributions and donations to a qualified charity.2. The maximum book value of investment in all charitable donation accounts is limited to five percent of credit union net worth. Any credit union in violation of this limit must bring the investment into compliance with this limit within thirty days of the violation.3. The charitable donation accounts will be held as a segregated custodial account or special purpose entity and must be specifically identified as a charitable donation account.4. Any trust established for the charitable donation account must be regulated by a state or federal financial regulatory agency, and any trustee or persons making investment decisions for the charitable donation account must be a registered investment advisor or regulated by a state or federal agency.5. The board of directors of the credit union has established policies governing the account consistent with the requirements of this section and safe and sound business practices.6. The terms and conditions of the written agreement between the parties to the charitable donation account must: a. Be consistent with the provisions of this section and safe and sound business practices.b. Require the charitable donation account to make charitable contributions and donations only to charities named that are exempt from taxation under section 501(c)(3) of the Internal Revenue Code.c. Document the investment strategies and risk tolerances the administrator must follow.d. Require all aspects of the account, including distributions and liquidations be accounted for in accordance with generally accepted accounting principles.e. Identify the frequency of distributions to qualified charities.7. The charitable donation account makes a distribution no less frequently than every five years, and distributes a minimum of fifty-one percent of the account's total return over the period since the last distribution.8. Upon termination and liquidation of the charitable donation account, credit unions may receive a distribution in kind of remaining assets or cash if the assets are otherwise permissible investments for a credit union.N.D. Admin Code 13-03-22-17
Adopted by Administrative Rules Supplement 2022-384, April 2022, effective 4/1/2022.General Authority: NDCC 6-01-04
Law Implemented: NDCC 6-06-06