Minimal Donor Restrictions on Use of Funds by CIRM

Reader Jim Fossett today raised a good point in connection with the use of donated funds by the California stem cell agency, some of which is going to pay the new chairman's salary.

Fossett said in a comment that donors may place restrictions on the use of their donations, which do not amount to a great deal of money relative to CIRM's $3 billion. (Fossett's full comment can be found at the end of the "private money" item.) The agency currently has about $2.8 million in donor funds on hand, but has committed $700,000 of that for an Institute of Medicine study of CIRM and $250,000 annually for the chairman's salary.

We asked CIRM's outside counsel, James Harrison, whether any donors had placed restrictions on the funds.

Harrison promptly replied,

"Some of the donors placed restrictions on the use of their funds. For example, donations from private foundations include a restriction on the use of funds for lobbying purposes. I don't recall any other restrictions."

The reason for the restriction on lobbying expenditures? Some nonprofits can endanger their nonprofit status if they engage in lobbying activities.

On another donated fund note, Nature magazine on June 29 carried a statement from Jonathan Thomas, the CIRM board's new chair, saying,

"CIRM has received close to $900 million in private donations above and beyond the money from private-bond proceeds."

We asked CIRM Communications Chief Don Gibbons about that figure. He replied,

"He(Thomas) was referring to the $880 million in donor and other leveraged funds that our 12 major facilities attracted. So, those were not donations to CIRM, rather donations to CIRM-backed projects that benefitted the state."