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June 8, 2005

Donor Reportedly Endowed a Chair — and Filled It

A Florida newspaper has revealed a highly unusual gift to Florida A&M University — in which the donor of an endowed chair ended up holding the position he paid to create.

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The St. Petersburg Times reported that Shirley Cunningham Jr., a Kentucky lawyer, gave Florida A&M $1 million to endow a chair in the law school in 2001. Under a state matching program, Florida then provided $750,000 for the chair. According to the newspaper, Cunningham was then hired to fill the chair and paid a salary of $100,000 a year — even though the newspaper said Florida A&M officials could find no evidence that Cunningham performed any work for the salary.

Florida A&M removed Cunningham from its payroll recently, the newspaper reported.

A spokeswoman for the university said that she could confirm that Cunningham had been on the payroll and was not on the payroll anymore. She declined to comment further.

Aside from the question of whether Cunningham worked for his salary, it is unusual — and counter to generally accepted fund raising ethics — for someone to endow a chair and then be hired for the job.

Cunningham, in an e-mail message, said “there is certainly another side to the story,” but declined to elaborate except to say that he would be releasing a statement later in the week.

— Scott Jaschik

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Comments

There’s probably a tax angle here. For example, get an up-front deduction for the endowment that offsets the income. It sounds a lot like the annuities that colleges pitch to potential contributors.

PN In NJ, at 8:42 am EDT on June 8, 2005

Except ...

that an annuity would not normally trigger matching funds from the state, would it?

Ralph Luker, at 1:04 pm EDT on June 8, 2005

It’s very old-fashioned, actually.

Think of the Muslim institution of the waqf, often used to establish madrasas. the donor put real property or money into the waqf, then occupied the office of teacher. Waqfs got no matching funds from the state of Florida, but it did have the great advantage that the offices of the waqf could be held (and the property enjoyrd, tax-free) by the donor’s descendents for generation after generation.

there’s very little new under the sun.

Diana, at 2:54 pm EDT on June 8, 2005

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