Research and travel grant procedures approved

Plain-English summary

A private foundation proposed six grant programs supporting research on a historical periodical press, scholarly databases and resources, dissertation work, research leave, and conference travel. Applicants generally used an online portal, interdisciplinary evaluators applied stated criteria, and recipients had reporting requirements; one specialized database grant went only to its current editor. The foundation also committed to monitoring grant use and recovering diverted funds. The IRS approved the procedures under section 4945(g)(3), so grants made under the approved procedures would not be taxable expenditures.

Ruling snapshot

• Question: Did the foundation's procedures for research, scholarly-resource, dissertation, fellowship, and travel grants satisfy the advance-approval requirements?
• Outcome: Approved.
• Key authorities: IRC §§ 117(a), 170(b)(1)(A)(ii), and 4945(g)(3); Treas. Reg. § 53.4945-4(c)(1).

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
P.O. Box 2508
Cincinnati, OH 45201

Number: 201951009 Employer Identification Number:
Release Date: 12/20/2019
Contact person - ID number:

Date: September 25, 2019 Contact telephone number:
LEGEND UIL: 4945.04-04

B= Nationality

C = Time period

D = Grant Program 1
E = Grant Program 2
F = Grant Program 3
G = Grant Program 4
H = Grant Program 5

Dear

You asked for advance approval of your educational grant procedures under Internal
Revenue Code Section 4945(g)(3). This approval is required because you are a private
foundation that is exempt from federal income tax.

Our determination

We approved your procedures for awarding educational grants. Based on the information
you submitted, and assuming you will conduct your programs as proposed, we
determined that your procedures for awarding educational grants meet the requirements
of Code Section 4945(g)(3). As a result, expenditures you make under these procedures
won't be taxable.

Description of your requests

Program 1. D awards grants to scholars engaged in the research of any aspect of the B
periodical press during C. The grants are intended to provide researchers with funds to
cover only those expenses directly related to research, such as transportation, lodging,
photocopies, scanning, database subscriptions, and the like. Indirect expenses are not
covered. The grants are intended to support research engaging with primary sources,
whether those sources appear in print, manuscript, or digital facsimile. All else being
equal, preference will be given to projects that use or bring to light new or little-known
materials . Those holding academic appointments as well as graduate students and
independent or retired scholars may all apply.

The D grants are described in section 4945(g)(3) of the Code because they are to
achieve a specific objective, the use of primary print and archival sources in basic
scholarly research.

Program 2. The E grant program provides one grant per year to support the research and
development of a scholarly database of authorial attributions for articles that were
published anonymously in D periodicals. The annual grant is paid to the Editor of E to
conduct new archival research to discover authorial attributions in additional articles,
expanding the range and contents of the database.

The E grant is a grant described in section 4945(g)(3) of the Code because the purpose
of the grant is to achieve a specific objective, namely the development and expansion of
the scholarly database known as the E.

Program 3. The F supports collaborative, as well as individual, projects that create
scholarly resources that will facilitate the work of other scholars researching B periodicals
of D. For example, eligible projects include, but are not limited to, the production of print
or digital publications; demonstration projects that make use of new technologies;
research tools such as indices and bibliographies; digitization efforts; or workshops or
seminars that address research methods for the study of periodicals. The award may be
divided among participants and be used for salary replacement; travel; research or
technical assistants; the purchase of necessary hardware or software; securing
permissions or rights; or other research expenses directly related to the project.

The F grants are grants described in section 4945(g)(3) of the Code because the purpose
of the grants is to achieve a specific objective, namely, the creation of scholarly
resources and collaboration that will facilitate or advance the field of periodical studies.

Program 4. G supports dissertation research that makes substantial use of digitized
collections of 19th-century British periodicals. G is intended to support historical and
literary research that deepens the understanding of the C B press in all its rich variety.

G is a grant described in section 4945(g)(3) of the Code because the purpose of the
grant is to achieve a specific objective, the support of historical and literary research , and
to improve or enhance researchers’ skills and capacities in using digitized scholarly
collections.

Program 5. H supports one scholar per year to enable him or her to conduct a research
project on the C B periodical press, by underwriting a leave of absence from such
scholar’s other employment of up to four full-time months and the research expenses
associated therewith. Funds may be used to supplement sabbatical or other grant
income, provide course “buy outs”, and/or conduct travel related to the proposed project.

H is a grant described in section 4945(g)(3) of the Code because the purpose of the
fellowships is to enhance the research and scholarly skills and capacity of the recipient
by affording him or her the time and resources to conduct his or her research.

Letter 4779 (10-2012)
Catalog Number 58222Y

Program 6. You offer small travel grants for graduate students and independent or retired
scholars who are presenting at your annual conference. Attending and presenting at
scholarly conferences is critical for the development of scholars at any level, giving them
an opportunity to present their own research as well as to interact, collaborate, and
network with others in their field.

The travel grants are described in section 4945(g)(3) of the Code because the grants
permit the recipients to improve and enhance their academic, research, presentation, and
related capacities and skills .

Programs 1 and 3 through 6 are publicized on your website, which includes information
regarding each program’s eligibility criteria, application deadlines, past recipients, and
other similar information. You also publicize the Programs through direct communications
with your members and the general public through direct mail, email, social media and
announcements and promotion at conferences and other events, and in your scholarly
journal, or in other scholarly publications. Program 2 is not publicized, because this grant
is made only to the then-current Editor of E, whom your Board of Directors has
determined is exceptionally qualified to carry out the purposes of the grant.

Except for Program 2 and the travel grants all applications are submitted through an
online application portal and all must include:

1. A curriculum vitae

2. A detailed narrative proposal or project description

3. The name(s) and email address(es) of one or two recommenders familiar with the
   proposed project.

In addition each project has other requirements peculiar to itself.

Travel awards are considered in connection with an applicant’s submission of a paper to
be presented at your conference. Graduate students in any discipline, as well as
independent and retired scholars, are eligible to apply. Applicants must submit an
abstract of their paper and a short curriculum vitae and must indicate in their cover letter
that they wish to be considered for a travel award.

A group of interdisciplinary evaluators will use the following criteria to evaluate
applications.

1. The importance of the project, including its use of materials relevant to deeper
   understanding of the B periodical press during C.

2. The quality of the application, including its clarity of expression.

3. The applicant’s preparation to pursue the project.

Letter 4779 (10-2012)
Catalog Number 58222Y

4. The feasibility of the plan of work and the likelihood that the applicant will be bring the
   entire project to a successful completion in due course.

Awardees of D, F, and H shall be required to submit a narrative and financial report at the
end of the grant period describing the use of the award funds and the awardee’s progress
toward achieving the purpose of the award. The full or excerpted sections of the report
may be published on your website. All publications resulting from or supported by these
awards must include an acknowledgment of the award.

Awardees of G fellowships are required to submit a narrative and financial report at the
end of the grant period describing the use of the award funds to support their dissertation
research, as well as the awardee’s progress toward achieving the purpose of the award.

Travel award recipients shall be required to submit a report describing the use of the
travel award funds, and you will verify that each award recipient in fact attended the
conference for which the travel award was granted.

In all cases, if you were to determine that any part of a grant had been used for improper
purposes, you would take all reasonable and appropriate steps to recover diverted funds
or to insure the restoration of diverted funds and would make no further grants to the
individual or individuals involved.

Basis for our determination

The law imposes certain excise taxes on the taxable expenditures of private foundations
(Code Section 4945). A taxable expenditure is any amount a private foundation pays as a
grant to an individual for travel, study, or other similar purposes. However, a grant that
meets all of the following requirements of Code Section 4945(g) is not a taxable
expenditure.

• The foundation awards the grant on an objective and nondiscriminatory basis.
• The IRS approves in advance the procedure for awarding the grant.
• The grant is:

– A scholarship or fellowship subject to Section 117(a) and is to be used for
study at an educational organization described in Section 170(b)(1)(A)(ii); or

– A prize or award subject to the provisions of Section 74(b), if the recipient of
the prize or award is selected from the general public; or

– To achieve a specific objective; produce a report or similar product; or
improve or enhance a literary, artistic, musical, scientific, teaching, or other
similar skill or talent of the recipient.

To receive approval of its educational grant procedures, Treasury Regulations Section
53.4945-4(c)(1) requires that a private foundation show:

• The grant procedure includes an objective and nondiscriminatory selection

process.

Letter 4779 (10-2012)
Catalog Number 58222Y

• The grant procedure results in the recipients performing the activities the grants
were intended to finance.

• The foundation plans to obtain reports to determine whether the recipients have
performed the activities that the grants were intended to finance.

Other conditions that apply to this determination

• This determination covers only the grant program described above. This approval
will apply to succeeding grant programs only if their standards and procedures
don’t differ significantly from those described in your original request.

• This determination applies only to you. It may not be cited as precedent.

• You cannot rely on the conclusions in this letter if the facts you provided have
changed substantially. You must report any significant changes in your program to
the Cincinnati Office of Exempt Organizations at:

Internal Revenue Service

Exempt Organizations Determinations
P.O. Box 2508

Cincinnati, OH 45201

• You cannot make grants to your creators, officers, directors, trustees, foundation
managers, or members of selection committees or their relatives.

• All funds distributed to individuals must be made on a charitable basis and must
further the purposes of your organization. You cannot award grants for a purpose
that is inconsistent with Code Section 170(c)(2)(B).

• You should keep adequate records and case histories so that you can substantiate
your grant distributions with the IRS if necessary.

We’ve sent a copy of this letter to your representative as indicated in your power of
attorney.

Please keep a copy of this letter in your records.
If you have any questions, please contact the person listed at the top of this letter.

Sincerely,

Stephen A. Martin
Director, Exempt Organizations
Rulings and Agreements

Letter 4779 (10-2012)
Catalog Number 58222Y