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Caption: Board of Trustees Minutes - 1936
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n8 BOAHD OF TRUSTEES [February 9 REVISED BUDGET OF T H E ATHLETIC ASSOCIATION A recommendation that the revised budget of the Athletic Association for the current fiscal year be approved. On motion of Mr. Trees, this budget was approved. O P I N I O N ON TYPE OF SECURITIES FOR E N D O W M E N T F U N D S Mr. Trees requested that the opinion recently rendered by the University Counsel on the type of securities in which endowment funds of the University may be invested, be made a matter of record. October 29, 1934 Judge Sveinbjorn Johnson, 250 Administration Building DEAR JUDGE JOHNSON: On April 8, 1925, the Board of Trustees adopted as a policy in relation to the investment of trust funds, a provision that the investment of such funds shall be "in accordance with the Statutes of the State of Illinois for the investment of trust funds." At a recent meeting of the Finance Committee the question was raised by an investment counsel present as to whether the Board of Trustees is bound to limit its investments in this manner. The point was made that governing boards of other universities, particularly endowed universities, do not observe such limits. I am sure the Finance Committee would appreciate it if at your convenience you would make some study of the problem and advise whether in your opinion the Board is subject to the State Statute covering the investment of trust funds with respect to the funds which the Board invests. Cordially yours, LLOYD MOREY Comptroller OPINION CONCERNING INVESTMENT OF TRUST FUNDS From the correspondence before me, including a letter to you from Mr. Trees, dated November 23, 1928, and a portion of a letter from the Harris Trust & Savings Bank, and from conversation with you, I believe an opinion is desired concerning the powers and duties of the Board of Trustees with respect to the investment of certain funds administered by it for educational purposes, but derived from private sources, as distinguished from money received from the United States Government and from legislative appropriations. It is due you as well as myself to remind us of the fact that a general question is propounded; I am not asked about the propriety of a specific investment. Consequently, my answer will have to be somewhat general, that is, in the form of a statement of principles. I At the outset, I find I must make an assumption—made necessary because the question is general. The assumption is that the University may administer funds which may properly be divided into two classes. First, moneys given outright to the University, with no restrictions save perhaps that which is implied from all the circumstances, namely: that the fund shall be used for educational purposes, leaving the mode of expenditure, the determination whether principal or interest, or both, shall be exhausted, the manner of investment, and the like, to the discretion of the Board. Whether you have any such fund, I am not informed. The second class would embrace all funds the income of which is administered by the Board for a specific purpose within the general powers of the University. I include in this class moneys left to the University, whether by will or other kind of instrument, the income of which the donor directed should be used by the Board for designated objects, such as student loans, the pur-
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