Taxation & Estate Planning

Income From Restricted Endowment Can Be Used For Construction Project at Cleveland Museum of Art

By michael

The Cleveland Museum of Art’s Endowment fund may use the income from four “art-purchase funds” to contribute to the cost of renovating the museum even though such use is against the original intent of such funds, the Cleveland Plain Dealer reported this morning.  Yesterday’s ruling was handed down by Judge Anthony J. Russoof the Cuyahoga County Probate Court thus helping “the museum move its $350 million construction project to completion by 2013. The project is $138 million short of the goal.”

Russo said the museum may draw an annual minimum of $5,498,000 from the four art-purchase funds — a figure based on this year’s total draw. By providing income — not from the principal — for the construction project at an annual draw of 49.99 percent, the original purpose of the funds will be maintained through an allocation of 50.01 percent for the purchase of art.

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The art-purchase money for the museum construction project will come from the J.H. Wade Trust (established in 1920), John L. Severance Trust (1935), Mr. and Mrs. William H. Marlatt Fund (1939) and Leonard C. Hanna, Jr. Purchase Fund (1952).

Full post as published by The Ohio Trust & Estate Blog on October 08, 2009 (boomark / email).