Legal Definitions - dotation

Dotation refers to a significant gift of money or property, typically made to an institution like a charity, university, or hospital, with the intention that it will provide ongoing financial support. Often, the principal amount of the gift is invested, and only the income generated is used, ensuring the long-term sustainability of the institution or a specific program within it.

Here are some examples to illustrate the concept of dotation:

• Example 1: University Scholarship Fund

  A prominent alumna makes a $15 million dotation to her former university. The university invests this substantial sum, and the annual interest generated is used exclusively to fund full-tuition scholarships for students from underserved communities pursuing degrees in public service. The original $15 million remains untouched, generating income year after year.

  This illustrates dotation as a large, permanent gift of funds to an institution (the university) designed to provide continuous financial support (scholarships) from the investment income, ensuring the program's longevity without depleting the initial capital.

• Example 2: Museum Conservation Endowment

  A private foundation establishes a $5 million dotation for a national art museum. The income from this fund is specifically dedicated to the conservation and restoration of the museum's collection of ancient artifacts. This ensures that the delicate and valuable pieces can be preserved for future generations, regardless of fluctuations in the museum's annual operating budget.

  Here, the dotation is a dedicated financial endowment providing a steady income stream for a specific, long-term purpose (art conservation) within a cultural institution, highlighting its role in securing specialized ongoing support.

• Example 3: Animal Shelter Infrastructure

  A local philanthropist provides a dotation of a new, state-of-the-art veterinary clinic to a community animal shelter. This gift includes not only the physical building and its equipment but also an accompanying fund of $2 million, the earnings from which are earmarked for the clinic's ongoing maintenance, medical supplies, and the salaries of specialized veterinary staff.

  In this scenario, dotation encompasses both a significant physical asset (the clinic) and a financial endowment. The accompanying fund ensures the long-term operational viability and quality of care provided by the new facility, demonstrating how a dotation can secure both capital and ongoing operational funding.