You are here: Home Internal Audit Activity Fund Manual Chapter III - Expenditures Gifts and Donations

Gifts and Donations

Donations from Public Funds are illegal (30-23-2 N.M.S.A., 1978 Compilation, as amended).

The anti-donation clause of the New Mexico Constitution prohibits outright gifts of public money to private citizens.  Expenditures  which have a public purpose and public benefit are permissible.  APS awards/prizes which further educational endeavors are considered to have a corresponding public purpose and public benefit.  Accordingly, these awards do not violate the anti-donation clause of our constitution.

However, the cost of these reward incentives must be nominal in nature. We are suggesting that in most cases, a nominal amount would be less than ten dollars per student.  MAXIMUM: Gifts are limited to $25.00 per person per year.

Gift cards may NOT be purchased. According to the IRS, giving someone a gift card of any kind is the equivalent of giving that person cash, and nominal “cash” gifts are always taxable. Therefore, Activity Funds may no longer be used to purchase gift cards.

A school may elect to donate funds for certain special projects; however, the funds to be donated must be raised through a special fund raising project that is clearly advertised to be for that specific purpose only. A copy of the advertisement must be attached to the disbursement voucher. Both the proceeds and expenses relating to this special fund-raising project must be clearly designated in the journal. The exact amount of profit from the special fund raising project must be donated (do not round off to the nearest even dollar amount). This will insure that the special account will be closed after using all acquired funds.

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