Governance

Joint Agreement

Joint Agreement between the Trustees of Mount Holyoke College and the Board of Directors of the Alumnae Association of Mount Holyoke College

The agreement described below is designed to reflect the following principles guiding the relationship between the Board of Directors of the Alumnae Association of Mount Holyoke College and the Trustees of Mount Holyoke College.

1. Everyone who has been involved in the discussions about the relationship between the College administration (which includes the Board of Trustees) and the Alumnae Association Board of Directors is highly invested in the success of Mount Holyoke College and its alumnae. Whether alumnae or not, we all care deeply about the future of Mount Holyoke College.

2. The College community, about which we care deeply, is not a faceless entity. It is made up of students (present and future), faculty, staff, alumnae, parents, and trustees.

3. Alumnae are the embodiment of the value of a Mount Holyoke College education.

4. The Alumnae Association has as its primary constituents the alumnae of the College and is also concerned about present students and prospective students, without whom the College cannot survive.

5. The College administration has as its primary constituents present students and prospective students and is also concerned about alumnae, without whom the College cannot survive.

6. Continued alumnae engagement with and connection to the College is critical for its long-term success. The Alumnae Association is dedicated to cultivating, strengthening, and maintaining these connections between the College and alumnae.

7. The College administration and the Alumnae Association are equally vested in the goal of making sure that alumnae are well informed about the academic and cocurricular activities of the College and the activities and achievements of its alumnae.

8. The College administration and the Alumnae Association share a common goal—the long-term success of the College and its alumnae. This shared goal means that we are on the same team and must work together cooperatively. Being on the same team does not guarantee constant agreement, but it does guarantee a commitment to work through difficulties when they occur, in a cooperative climate of trust

9. The Alumnae Association needs a reliable source of funding to provide programs/services to alumnae and to maintain autonomy.

10. The College needs reliable systems for determining its annual expenses, for generating its annual operating income, including the Alumnae Annual Fund, and for maintaining an ongoing relationship with its alumnae.

This agreement is intended to be a vehicle for both the Alumnae Association and the College administration to have their needs met and to reflect in a structural way the fact that we are on the same team and our fortunes rise or fall together. The “endowment unit” arrangement is essential to meet the Alumnae Association’s need for a reliable source of funding and autonomy in the annual setting of its budget. The fundraising limitation is essential to the College administration to avoid any competitive fundraising that could undermine the generation of the annual income needed by the College. We are confident that the act of faith and courage required by the signatories of this agreement represents the beginning of a new and restorative chapter in the history of the relationship between the College administration and the Alumnae Association. This agreement takes effect on July 1, 2002, and supercedes all previous agreements.

1. The Alumnae Association’s net operating and capital budget for FY2002–03 of $1,533,342 is equivalent to an endowment level of $30,667,000, assuming a 5% distribution. Based on the December 31, 2001 endowment unit value of $4.15100526, this level of endowment is equivalent to 7,387,849 endowment units.

2. These 7,387,849 endowment units (rather than the $30,667,000 endowment level) will be the basis for Alumnae Association funding.

3. The Alumnae Association’s FY2002–03 net operating and capital budget of $1,533,342 will be funded in full by the College under the terms reached in the Interim Agreement between the College and the Alumnae Association on August 13, 2001.

4. For each fiscal year, beginning FY2003–04, the College will distribute to the Alumnae Association 5% of the average market value of the 7,387,849 endowment units as of December 31 of the three years just completed. (For example, the FY2003–04 distribution will be 5% of the average market value of the 7,387,849 endowment units on December 31, 2000, 2001, and 2002.)

5. Beginning in FY2003–04, the College will provide funding for the Alumnae Association budget in excess of the endowment distribution, if necessary to match the College’s percentage increases for staff salaries and benefits and to achieve a 4% annual increase in the Alumnae Association’s non-compensation budget (the “bridge level”). In the first year that the endowment distribution is greater than or equal to 110% of the bridge level, the endowment distribution will become the total amount of funding for the Alumnae Association budget.

6. In subsequent years, if faced with a declining endowment distribution, the College, upon request, will lend funds to the Alumnae Association to smooth the impact on the Association’s budget. Loans will be made on an annual basis and be repaid annually, as the Alumnae Association’s budget permits. Interest will be accrued at the semi-annual LIBOR rate (London Interbank Offer Rate) plus 10 basis points.

7. The Founder’s Fund units are excluded from the above determinations.

8. Requests for additional funding from the College (other than the endowment distribution described above) may be made annually through the College’s budget process.

9. The College will continue to provide without charge office space, computer support, and other related services that are currently being provided.

10. The Alumnae Association agrees that it will not engage in fundraising activity through June 30, 2005. Beginning July 1, 2005, the Alumnae Association agrees that it will limit its fundraising activities to advertisements in the Alumnae Quarterly twice a year for the Founder’s Fund. The College may also advertise in the Quarterly twice a year for College fundraising purposes.

11. The Annual Fund is the College’s umbrella fundraising organization for the College’s yearly operating budget. This unites the annual fundraising efforts of the College with the volunteer structure reporting to the Trustee Development Committee, with staff responsibility residing in the Development Office of the College. There will be three segments of the Mount Holyoke College Annual Fund: the Alumnae Annual Fund, the Parents Annual Fund, and the Friends Annual Fund.

12. The Alumnae Annual Fund is the focus of alumnae annual giving to Mount Holyoke College.

13. Effective June 30, 2003, the Alumnae Development Committee will cease to exist in its current form as a standing committee of the Alumnae Association. The new Alumnae Annual Fund Committee will begin on July 1, 2003.

14. The name “Alumnae Fund” will not be used by either the College or the Association without the written agreement of both parties.

15. The term of this agreement will be ten years. The initial review will occur in the fall of 2011 and any modifications would become effective in FY2012–13. Any modifications to the agreement will be in writing and will be mutually agreed upon.

16. Both parties will meet annually to discuss joint goals and other aspects of their working relationship. As part of this agreement, the Alumnae Association and the College pledge to continue to work together cooperatively and in good faith toward their joint goals.

Karen M. Hendricks ’76
President, Alumnae Association
Mount Holyoke College

Eleanor Graham Claus ’55
Chair, Board of Trustees
Mount Holyoke College

June 10, 2002