HAO is a 501(c) (3) non-profit corporation organized exclusively for the charitable and educational purpose to advance the interest and promote the welfare of the University of Houston. All constituent and club financial information is reported to the IRS on the tax forms 990 and 990-T and is included in the annual external audit.

Non-profit status is recognized if an organization does not distribute any of its income to its members, officers or governing body other than as reasonable compensation for services; it has existed for the three preceding years and during those years has had a governing body or officers elected by a vote of its members or by a vote of delegates elected by the members - or has been formally recognized as a local chapter, affiliate, unit or subsidiary organization of the parent organization; and it does not devote a substantial part of its activities attempting to influence legislation and does not make campaign contributions or participate or intervene in any political campaign on behalf of any candidate for public office.

SALES TAX
HAO is recognized as tax exempt from the State of Texas. Tax forms are available from the HAO office to show this status when purchasing from local businesses.

FUNDRAISING
The HAO Fundraising Policy states:

Fundraising activities by HAO constituents, area clubs, and committees must comply with all local, state, and federal regulations and HAO financial guidelines.

Methods of compliance with the federal Substantiation and Disclosure Provisions must be approved by the HAO SVP for Finance and Administration.

The HAO P.O. Box address should be used as the return for all fundraising solicitations. Solicitations should include the market value and the event code among other requirements. The copy must be approved by HAO in advance of the final printing for compliance.

All gifts collected at the fundraising event should be sent to the HAO office for deposit with an attached HAO deposit from and should include: Name, address, phone, purpose, and value of goods or services provided in return. This information is required for tax receipt purposes.

INSURANCE
Your association or club is covered for insurance under the HAO umbrella for both Liability (Travelers Insurance) and Directors and Officers (Gulf Insurance). Liability insurance includes “host” liquor liability coverage. This does not include the selling of alcohol, where a TABC permit is required, but does include the serving of alcohol at a private event. However, this insurance is nullified if a law is broken while serving the alcohol. For example, if your group serves alcohol to a minor or if someone is served after they have become intoxicated, there would be no coverage in the event of a lawsuit.

When planning your activities and events, you should retain caterers who hold a current liquor license and can provide you with a certificate of insurance. In those cases where your group provides alcohol at no charge at your private party, you should not provide alcoholic beverages to a minor or to an individual when it is suspected or apparent that the individual is intoxicated.

FINANCIAL
Each group is responsible for the financing of its own functions and so long as they do not violate HAO Bylaws, policies, or procedures, shall devise whatever means of funding as approved by its officers and members.

Financial transactions, other than those of which are routine, should be approved by your board and recorded in your minutes.

The University of Houston Alumni Association is not liable for any acts or debts incurred by your association or club. However, HAO reserves the right to review and execute all legal contracts involving constituents and clubs.

The administrative year runs September through August. The fiscal year runs January through December.

Expenditures must be directly related to the HAO exempt purpose of supporting the University of Houston.

Chapter meeting and committee meeting expenses must document the purpose, the place, the names of those in attendance, and the date of the meeting.

Expenses payable to vendors should be supported by an itemized receipt or itemized invoice, or check authorization form, and must be approved by an officer, preferably the treasurer. An officer may not approve his own expense reimbursement. All reimbursements must be submitted within 60 days of purchase and be supported by a receipt. Please allow a minimum of 10 days for accounts payable processing.

All deposits should be sent directly to the HAO office. Alternate return addresses may not be used. Bank accounts and other types of financial institution accounts are not permitted without written approval from the HAO President and must be in compliance with the HAO Bylaws and policies.

Conflict of Interest: If a potential conflict of interest exists among board members and vendors/suppliers of the activities of the board, then the board member must disclose this potential conflict in writing to the HAO Board of Directors. This is required for all related transactions, whether or not a benefit has occurred. This applies to all HAO Volunteer Boards.

Life member endowment distributions are based on a 36-month average market value. The distribution rate is determined by the HAO Board of Directors and is currently set at 5%. A written request is needed to transfer the distribution into an operating account. Otherwise, the earnings will continue to grow the endowment.

All funds, other than those deemed long-term endowments, are deposited in HAO short term investment accounts.

Scholarship endowments require a minimum of $10,000 to set up. All long-term endowment funds are invested by the investment management firm selected by the HAO Finance Committee and overseen by the HAO Treasurer. Earnings allocations and endowment distributions are recorded on an annual basis unless otherwise requested.