HB 751

As Introduced
136th General Assembly
   Regular Session  H. B. No. 751
       2025-2026
  Representatives Mathews, A., Ritter
  To amend sections 109.25, 1715.51, and 5813.06 and  1
  to enact sections 1715.551, 1715.552, 1715.553,  2
  1715.554, 1715.555, 1715.556, 1715.557,  3
  1715.558, and 1715.559 of the Revised Code to  4
  establish the scope and procedures for a civil  5
  action when an institution violates a  6
  restriction in an endowment agreement.  7
 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
     Section 1. That sections 109.25, 1715.51, and 5813.06 be  8
amended and sections 1715.551, 1715.552, 1715.553, 1715.554,  9
1715.555, 1715.556, 1715.557, 1715.558, and 1715.559 of the  10
Revised Code be enacted to read as follows:  11
     Sec. 109.25. The attorney general is a necessary party to  12
and shall be served with process or with summons by registered  13
mail in all judicial proceedings, the object of which is to:  14
     (A) Terminate a charitable trust or distribute assets;  15
     (B) Depart from the objects or purposes of a charitable  16
trust as the same are set forth in the instrument creating the  17
trust, including any proceeding for the application of the  18
doctrine of cy pres or deviation;  19
     (C) Construe the provisions of an instrument with respect  20
H. B. No. 751  Page 2
As Introduced
to a charitable trust;  21
       (D) Determine the validity of a will having provisions for  22
a charitable trust;  23
       (E) Enforce the express terms of an endowment agreement  24
under sections 1715.551 to 1715.559 of the Revised Code.  25
       A judgment rendered in such proceedings without service of  26
process or summons upon the attorney general is void,  27
unenforceable, and shall be set aside upon the attorney  28
general's motion seeking such relief. The attorney general shall  29
intervene in any judicial proceeding affecting a charitable  30
trust when requested to do so by the court having jurisdiction  31
of the proceeding, and may intervene in any judicial proceeding  32
affecting a charitable trust when he the attorney general  33
determines that the public interest should be protected in such  34
proceeding.  35
       Sec. 1715.51. As used in sections 1715.51 to 1715.59 of  36
the Revised Code:  37
       (A) "Benefactor" means each person signing an endowment  38
agreement who committed in the agreement to transfer property to  39
an institution with the institution's consent.  40
       (B)(1) "Benefactor representative" means either:  41
       (a) A person designated in an endowment agreement, whether  42
or not born or existing at the time of such designation, to act  43
in place of the benefactor for the purpose of resolving disputes  44
about the agreement, including the agreement's validity,  45
interpretation, performance, and enforcement, and any action  46
that the agreement contemplates;  47
       (b) If no person is designated in the endowment agreement,  48
H. B. No. 751  Page 3
As Introduced
as described in division (B)(1)(a) of this section, the  49
administrator or executor of a benefactor's estate.  50
        (2) "Benefactor representative" does not mean the  51
institution receiving or administering property under an  52
endowment agreement or any person designated by such institution  53
for any purpose.  54
        (C) "Charitable purpose" means any purpose the achievement  55
of which is beneficial to the community, including the relief of  56
poverty, the advancement of education or religion, the promotion  57
of health, and the promotion of a governmental purpose.  58
        (B)(D) "Institution" means any of the following:  59
        (1) A person, other than an individual, organized and  60
operated exclusively for charitable purposes;  61
        (2) A governmental organization to the extent that it  62
holds funds exclusively for a charitable purpose;  63
        (3) A trust that had both charitable and noncharitable  64
interests and the noncharitable interests have terminated.  65
        (C)(E) "Institutional fund" means a fund that is held by  66
an institution exclusively for charitable purposes.  67
"Institutional fund" does not include any of the following:  68
        (1) Program related Program-related assets;  69
        (2) A fund held for an institution by a trustee that is  70
not an institution;  71
        (3) A fund in which a beneficiary that is not an  72
institution has an interest other than an interest that may  73
arise upon a violation of or the failure of the purposes of the  74
fund.  75
H. B. No. 751  Page 4
As Introduced
       (D)(F) "Endowment agreement" means a gift instrument  76
signed by a benefactor and by a state institution of higher  77
education or another institution whose corporate purpose is to  78
benefit an identified state institution of higher education and  79
receives, holds, or administers charitable transfers of property  80
for such state institution of higher education; and that  81
contains both of the following obligations:  82
       (1) The benefactor commits to transfer property to a state  83
institution of higher education or to another institution to  84
receive, hold, or administer the property for the use or benefit  85
of a state institution of higher education with the consent of  86
such state institution of higher education.  87
       (2) An institution signing the instrument commits that the  88
institution or a state institution of higher education will  89
receive, hold, or administer the transferred property as an  90
endowment fund for the use or benefit of a state institution of  91
higher education subject to any restrictions on management,  92
investment, spending, or purpose expressed in the instrument.  93
       (G) "Endowment fund" means an institutional fund or any  94
part thereof that, under the terms of a gift instrument, is not  95
wholly expendable by the institution on a current basis.  96
"Endowment fund" does not include assets that an institution  97
designates as an endowment fund for its own use.  98
       (E)(H) "Gift instrument" means a record or records,  99
including an institutional solicitation, under which property is  100
granted to, transferred to, or held by an institution as an  101
institutional fund.  102
       (F)(I) "Person" means an individual, corporation, business  103
trust, estate, trust, partnership, limited liability company,  104
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As Introduced
association, joint venture, public corporation, governmental  105
organization, or any other legal or commercial entity.  106
       (G)(J) "Program related Program-related asset" means an  107
asset held by an institution primarily to accomplish a  108
charitable purpose of the institution and not primarily for  109
investment.  110
       (H)(K) "Record" means information that is inscribed on a  111
tangible medium or that is stored in an electronic or other  112
medium and is retrievable in perceivable form.  113
       (L) "State institution of higher education" has the same  114
meaning as in section 3345.011 of the Revised Code and is an  115
"institution" within the meaning of this chapter.  116
       Sec. 1715.551. If an institution violates a restriction  117
contained in an endowment agreement on the management,  118
investment, spending, or purpose of the endowment fund, a  119
benefactor or benefactor representative may notify the  120
charitable law section of the office of the attorney general in  121
writing of the violation.  122
       Sec. 1715.552. The attorney general may enforce the  123
interests of the beneficiaries of an endowment agreement by  124
filing a complaint for breach or to obtain a declaratory  125
judgment of rights and duties expressed in the agreement and as  126
to all of the actions it contemplates, including the  127
interpretation, performance, and enforcement of the agreement  128
and determination of its validity.  129
       Sec. 1715.553. (A) If, within one hundred eighty days  130
after receiving the notice under section 1715.551 of the Revised  131
Code, the attorney general has not obtained full compliance with  132
the restriction and restitution to the endowment fund of  133
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As Introduced
property approximately equal to any value lost due to the  134
violated restriction, a benefactor or benefactor representative  135
may file a complaint for either or both of the following:  136
       (1) Breach of the endowment agreement;  137
       (2) To obtain a declaratory judgment of rights and duties  138
expressed in the agreement as to all of the actions it  139
contemplates, including the interpretation, performance, and  140
enforcement of the agreement and determination of its validity.  141
       (B) Each of the following applies to the complaint:  142
       (1) It may be filed regardless of whether the agreement  143
expressly reserves a right to sue or enforce.  144
       (2) The filing of a complaint by the attorney general  145
under section 1715.552 of the Revised Code is not a requirement  146
for filing a complaint under this section.  147
       (3) It shall not seek a judgment awarding to the plaintiff  148
damages, court costs, attorney's fees, or any other award of  149
money or other property.  150
       (4) It shall seek only one or both of the following:  151
       (a) Declaratory relief;  152
       (b) Equitable relief consistent with the charitable  153
purposes expressed in the endowment agreement and consistent  154
with the charitable purposes of the institution administering  155
the endowment fund under the endowment agreement and the state  156
institution of higher education receiving the use or benefit of  157
the endowment fund.  158
       Sec. 1715.554. An institution that is a party to an  159
endowment agreement, or the state institution of higher  160
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As Introduced
education receiving the use or benefit of the endowment fund  161
established through an endowment agreement, may obtain a  162
declaratory judgment of rights and duties expressed in an  163
endowment agreement and as to all of the actions it  164
contemplates, including the interpretation, performance, and  165
enforcement of the agreement and determination of the  166
agreement's validity. The institution shall seek such  167
declaration in response to any complaint brought under sections  168
1715.551 to 1715.559 of the Revised Code.  169
       Sec. 1715.555. Every complaint authorized by sections  170
1715.551 to 1715.559 of the Revised Code shall be filed in a  171
court of competent general jurisdiction in the county where the  172
state institution of higher education receiving the use or  173
benefit of the endowment fund has its principal office. Every  174
such complaint shall:  175
       (A) Name the attorney general as a party;  176
       (B) Name as parties each institution that signed the  177
endowment agreement or its successor, the state institution of  178
higher education receiving the use or benefit of the endowment  179
fund, and any institution that currently holds or administers  180
property subject to the agreement;  181
       (C) Name as parties each benefactor and benefactor  182
representative.  183
       Sec. 1715.556. The failure to join as a party a benefactor  184
or benefactor representative is not jurisdictional. The court,  185
however, shall afford a benefactor or benefactor representative  186
an opportunity to be heard or to intervene if sought within a  187
reasonable time before the court renders final judgment.  188
       Sec. 1715.557. The interest of a benefactor and the  189
H. B. No. 751  Page 8
As Introduced
interest represented by a benefactor representative shall not be  190
presumed to be identical with the interest of the attorney  191
general or a state institution of higher education or an  192
institution administering an endowment fund under an endowment  193
agreement.  194
       Sec. 1715.558. (A) Except as allowed by division (B) of  195
this section, a benefactor or benefactor representative shall  196
not file a complaint authorized by sections 1715.551 to 1715.559  197
of the Revised Code based on a breach of an endowment agreement  198
if the person filing the complaint discovered the breach more  199
than six years before filing the complaint.  200
       (B) If, during the sixth year after discovery of the  201
breach of an endowment agreement, a benefactor or benefactor  202
representative notifies the charitable law section of the office  203
of the attorney general in writing of the breach of an endowment  204
agreement as authorized by sections 1715.551 to 1715.559 of the  205
Revised Code, the period within which such benefactor or  206
benefactor representative must file a complaint authorized by  207
sections 1715.551 to 1715.559 of the Revised Code is extended  208
automatically by two hundred ten days.  209
       Sec. 1715.559. Sections 1715.551 to 1715.559 of the  210
Revised Code apply only to the following:  211
       (A) Endowment funds established on and after the effective  212
date of this section;  213
       (B) Endowment funds established before the effective date  214
of this section, but only with respect to breaches of such  215
endowment agreements if those breaches occur on or after the  216
effective date of this section.  217
       Sec. 5813.06. (A) Nothing in sections 5813.01 to 5813.05  218
H. B. No. 751  Page 9
As Introduced
of the Revised Code affects the construction or interpretation  219
of sections 1715.51 to 1715.59 of the Revised Code relating to  220
the uniform prudent management of institutional funds act.  221
Specifically, neither the percentage set forth in division (B)  222
of section 5813.02 of the Revised Code nor the amount actually  223
requested by a governing board pursuant to that section shall be  224
construed or interpreted to limit or expand what is a prudent  225
amount that can be expended by a governing board of an  226
institution under sections 1715.51 to 1715.59 of the Revised  227
Code.  228
        (B) If an institutional trust fund is also an  229
institutional fund as defined in division (C)(E) of section  230
1715.51 of the Revised Code with the result that sections  231
1715.51 to 1715.59 of the Revised Code also are applicable to  232
the institutional trust fund, then sections 1715.51 to 1715.59  233
of the Revised Code apply to the institutional trust fund, and  234
sections 5813.01 to 5813.07 of the Revised Code do not apply to  235
the institutional trust fund.  236
        Section 2. That existing sections 109.25, 1715.51, and  237
5813.06 of the Revised Code are hereby repealed.  238