Welcome to the LACGP Newsletter. This e-newsletter is sent out on a monthly basis. The newsletter provides links to this page. Please see below for the items that appeared in the December 2022 issue.

The Top 10 Lessons Learned From a Complex Life Estate Gift, a 16-Acre Avocado Ranch in Santa Paula

By Jill Rode

In 2021, the Music Academy realized the gift of a retained life estate. As the new gift planning officer, I hadn’t worked with retained life estates. Little did I know what I was in for. The Music Academy had, in 2008, agreed to ownership of a 16-acre avocado ranch and home in Santa Paula, the residence of one of our alums. When the alum passed, all operations of the ranch fell to the Academy.

Here are the top 10 lessons I learned from working with such a complex gift!

  1. Gather your experts: A working ranch is a complicated asset. There are water rights, crop insurance, employees, and more. To assist in managing the property, I gathered experts – a CPA, our board president, an estate attorney, and a wealth planner. This ad hoc committee meet regularly for six months to assist with decision making, choosing a realtor, choosing a buyer, and be an all-around sounding board for all the issues that came up. “What issues?” you may ask. Everything from cleaning out the house and a broken main gate to when to harvest the avocados (right before Cinco de Mayo, in case you were wondering).
  2. Visit the property: While we had finalized the agreement in 2008 and have visited regularly with the donor, we have never gone back to inspect the property. There were issues with the home and it’s state, determining ownership of the farm machinery, and a long-term employee. Many experts will tell you to hold regular inspections. As the property is yours, you need to ensure that it is well maintained.
  3. Farm knowledge: Having owned a farm previously, I have had experience in understanding water rights, crop insurance, harvest windows and the like. If you are considering a life estate, make sure you have someone on your team, or get an advisor, who can assist in understanding all that such a property would entail. Of course, now I know a bit more about avocado harvests!
  4. Insurance: What kind of insurance might a working ranch require? This goes beyond typical homeowner insurance matters. Research was also needed for insurance concerning potential crop failure as well.
  5. Share knowledge: I worked closely with the trust attorney and trustee. From assisting with cleaning out the house, to being part of the memorial celebration, my team and I were involved in all aspects and details of managing the property. We developed a nice relationship with the advisors so we could assist when needed, knowing that our alum would want us to honor her memory in this way. I would recommend starting this relationship earlier, as we didn’t until the gift had matured.
  6. Institutional capacity: Guess who got called when the harvest workers couldn’t get in the main gate? And guess who called the gate repair to fix it? As the gift planning officer, I was the point person for the CPA, the bookkeeper, anything that broke at the ranch, the water board, the real estate broker, the trust attorney, the trustee, and many more. Not every organizations has a dedicated gift planning staff member. If you don’t, could you hire someone to assist you with matured life estates? What is the cost/benefit of hiring someone to assist? If you don’t have the resources to hire someone, how can your staff/team divide the duties so you can maintain your current workload with the addition of managing a property? Of course, not all properties are working ranches, however when you accept a retained life estate, it is good to know if you can now or in the future manage this gift so that you can fulfill donor intent and realize the gift.
  7. Be kind: The trustee was a long-time personal friend of the donor. While realizing and liquidating a life estate certainly is a real estate transaction, it is good to remember that some of the people that you will interact with had long-term relationships with the donor. That is why the Academy offered to have a musical artist at the memorial service, that our CEO and I attending the service, and that we interacted with those in attendance to offer our condolences.
  8. It takes time: From the maturity of the gift to selling the property, there were two harvests, multiple meetings, many site visits, and a memorial service. The property sold a little more than six months after the ranch came under the Academy’s management. And, the gift was made in 2008 and matured in 2021, 13 years. Be prepared for a gift such as this to take time.
  9. Educate: Many times, when other staff heard of the avocado ranch, they asked when we could go visit and have some guacamole! After laughing heartily (and letting them know that I wouldn’t be giving them free avocados as I wanted our harvest to make money so that the expenses we were incurring would be covered), I used it as an opportunity to explain what a life estate was, how generous the donor had been, and how complicated and lovey a gift it was. Then, I would share with them that perfectly good avocados were at the farmer’s market and they should avail themselves of these for guacamole.
  10. Thank: When it is over, thank everyone. Thank the realtor who sold the property. Thank the trustee who cleaned out the home. Thank the CFO who reviewed and signed all the documents. Thank your staff accountant who paid the insurance bills and negotiated taking on the long-term employee during the ownership period. Thank the ad-hoc committee (perhaps taking them out for margaritas and guacamole!). It takes a group to make it happen and when another estate comes along, you want this amazing team of folks to join you again on another gift journey!

New Member Interview Questions with Lauren Yamaoka

Membership certainly has its privileges, one of which is to be involved with a wonderful community of seasoned professionals, eager to share of their professional lives with those coming into the field of gift planning. LACGP recently had the pleasure to hear from one of our newest members, Lauren Yamaoka, CAP, Director of Development at the Fuller Foundation in Rancho Mirage, CA.

LACGP: Lauren, thank you for sharing some time with us. Let’s get right to some of the pressing questions that others, I expect, are excited to learn about you.

LACGP: How did you learn about the Los Angeles Council of Charitable Gift Planners (LACGP)?

I joined The Fuller Foundation only a few months after completing my Chartered Advisor of Philanthropy (CAP) designation from The American College of Financial Services. After learning of my interest in the area of planned giving, my colleague Dasha Thomas, Senior Director of Gift Planning encouraged me to join LACGP, especially since I was a new transplant to the Southern California area.

LACGP: What would you like to gain from being a member of LACGP?

I would love to build out my community by meeting others in the LA area with similar careers and positions. I have been lucky enough to build my professional network in a wide range of major cities across the US where I’ve resided – Chicago, San Francisco, and Dallas–and I am excited to meet more wonderful people who are passionate about gift planning in Southern California.

LACGP: What is interesting to you about planned giving? Do you have a particular passion in the field?

The first major gift I closed in my frontline career was a planned gift – I was three months into my new role and was able to document a $9M estate gift to benefit Northwestern University during their $5B comprehensive campaign. Ever since that gift, I’ve been passionate about the field of planned giving and have made it a goal to learn as much as possible about the various gift planning vehicles and strategies that can benefit donors. Most of all, I am passionate about encouraging others in MGO roles to not be afraid to have those planned giving related conversations, even early in your relationship with the donor!

LACGP: What do you feel is the most important thing you can learn this year?

I moved to Southern California just over a year ago and so much of my current focus is still on learning the philanthropic landscape of this region and the greater LA area. However, staying up to date on the latest gift planning trends and regulations is always of interest.

LACGP: How can LACGP help you accomplish this year’s goals?

I have so enjoyed getting to know many LACGP members while attending the Western Regional Planned Giving Conference this spring, and I look forward to continuing to meet more members in the future. Having a strong network of fellow gift planners so we can support each other with resources and strategic support is a professional goal of mine now and in the years to come.

Lauren Yamaoka ([email protected]) is the Director of Development & Foundations at The Fuller Foundation (https://legacy.thefullerfoundation.org/), where she works to help individual donors and grantmaking foundations achieve their philanthropic goals and support Fuller Theological Seminary and its community. She earned a BA in English from Hope College and an MFA in Creative Writing from Roosevelt University. She has worked in nonprofit fundraising for more than decade, holding positions with Northwestern University, Southern Methodist University, and Children’s Medical Center Foundation in Dallas. She earned a Chartered Advisor of Philanthropy (CAP) designation from The American College of Financial Services in early 2021, and was awarded the College’s NextGen Financial Services Professional Award in November 2021. She is a member of the Alumni Council for The American College. In her spare time, Lauren is an avid reader and an active nonprofit volunteer. She currently serves as Parliamentarian for the Woman’s Club of Indio, and has previously been involved with organizations like CASA and the Junior League. Lauren resides in the Coachella Valley with her husband Tom and their infant son, Ralph.

LACGP LinkedIn Polls

Periodically, LACGP runs a poll on LinkedIn, which designed to get a pulse of what is happening with gift planning efforts nearby. Please let your voice be heard and respond to the short polls. Your input will help all of us get a better sense directional clarity as we go about building our programs.

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