20-9-604. Gifts, legacies, devises, and administration of endowment fund. (1) The trustees of a district may accept gifts, legacies, and devises, subject to the conditions imposed by the deed of the donor or the will of the testator or without any conditions imposed. Unless otherwise specified by the donor, devisor, or testator, when a district receives a gift, legacy, or devise, the trustees may deposit the gift, legacy, devise, or the proceeds in any budgeted or nonbudgeted fund at the discretion of the trustees and may thereafter transfer any portion of the gift, legacy, devise, or proceeds to any other fund at the discretion of the trustees.

(2) If the trustees accept a gift, legacy, or devise pursuant to subsection (1) and if the donor, devisor, or testator specifies the gift, legacy, or devise for an endowment, the trustees shall deposit the gift, legacy, devise, or proceeds in an endowment fund and shall administer the endowment fund so as to preserve the principal from loss, and only the income from the fund may be appropriated for any purpose. Money deposited in the endowment fund must be invested by the trustees according to the provisions of the Uniform Management of Institutional Funds Act, Title 72, chapter 30. All interest collected on the deposits or investments must be credited to the endowment fund.

(3) Whenever a district has been abandoned, the endowment fund of the abandoned district must be transferred and placed in the endowment fund in the district to which the territory is attached.

(4) As the custodian of the endowment fund, the county treasurer is liable on the treasurer's official bond for the endowment fund of any district of the county. By July 20, the county treasurer shall report to the trustees of each district on the condition of its endowment fund, including the status of the investments that have been made with the money of the fund. The county treasurer shall also include the endowment fund in the treasurer's reports to the board of county commissioners.

(5) The trustees of any district having an endowment fund shall provide suitable memorials for all persons or associations of persons making gifts to the district that become a part of the endowment fund.

(6) The trustees of a district that previously deposited donated funds in an endowment fund without specific instruction by the donor, devisor, or testator may move the donated funds and any accumulated interest to any other budgeted or nonbudgeted fund of the district and may spend donated funds and any accumulated interest unless restricted by condition imposed by the donor, devisor, or testator.

(7) The legislature encourages school district trustees to adopt a gift acceptance policy to determine the suitability of accepting gifts under this section.