UW–Madison recognizes that many of its activities provide potential sources of revenue or other non-financial benefits through legitimate and worthwhile opportunities for sponsorships and other promotional activities. This revenue can be beneficial to the entire university community and, in turn, the state of Wisconsin. But it’s also necessary to recognize that the university is a public institution and that its reputation and image must be protected. Therefore, the university has adopted the following policies applicable to the granting of sponsorship rights to non-university entities. Please note, university entities should be mindful of the significant value to non-university entities that results from the exposure and association with the university that a sponsorship relationship provides.
Sponsorship of school, college, department, unit, or Registered Student Organization (RSO) activities, programs, or events by non-university entities can, when conducted in an appropriate manner, be beneficial to the sponsored school, college, department, unit or RSO, as well as to the sponsoring entity, to the university community, and to the state. However, it is also necessary to recognize that the university is a public institution and that its reputation and image must be protected, and that it must not serve to unduly advance the interests of one non-university entity or organization over another. Finally, university entities should be mindful of the significant value to non-university entities that results from the exposure and association with the university that a sponsorship relationship provides.
The Office of the Vice Chancellor for University Relations has been given the authority to administer these policies at the university. Questions pertaining to the policy, and requests for approvals or deviations from the policy should be directed to that office or designee.
This Policy provides guidance to schools, colleges, departments, academic or administrative units and registered student organizations (RSOs) on the sponsorship of university or RSO events, programs, publications or other activities by nonuniversity entities.
Except for the restriction on sponsorship by tobacco companies, and the special reviews required for sponsorship by alcohol companies or organizations associated with gaming, any corporation, other organization or individual that offers and does provide support or underwriting for university events or activities may be sponsors. It is also permissible to decline an offer of support or sponsorship. There may be other considerations that factor into a decision whether to accept or decline an offer of sponsorship.
When a school, college, department, unit or RSO (collectively, “university entity”) acknowledges a sponsor, invariably an association in the mind of the public is created between the sponsor and university entity being sponsored. Thus, when a university entity is considering entering into a sponsorship relationship, it should consider the compatibility between its mission and image and that of the sponsor. For example, sponsorship by an automobile company may be appropriate for the Engineering Expo, but less appropriate for the Transportation Department’s “Alternate Mode Week.” There is no obligation for a university entity to accept sponsorship support from non-university entities whose mission or image is deemed incompatible with the mission or image of the university entity or the sponsored program, event or activity.
The university has the right to and will refuse sponsorship from unacceptable sources, or with an unacceptable message. For example, a sponsorship is unacceptable that (1) is in conflict with university policies; (2) adversely affects the university’s reputation; (3) appears to create an endorsement by the university of a particular company, product, political candidate or position regarding public policies; (4) is considered to contain obscene, indecent or profane material; (5) ridicules, exploits or demeans persons on the basis of their age, color, creed, physical or mental disability, physical appearance, national origin, citizenship, veteran status, marital status, race, religion, sex, sexual orientation, gender or gender identity; or (6) promotes tobacco products.
Sponsorship by alcohol companies or distributors should not be assumed to be permissible and must be submitted to Vice Chancellor for University Relations or designee for review and approval prior to acceptance. When permitted, the content of any alcohol beverage sponsorship acknowledgment may not encourage underage drinking or the misuse of such beverages and must include specific warnings against abusive or unsafe use of alcohol and/or must conspicuously promote responsible use of alcohol. When approved, the sponsorship arrangement can be set up as indicated at B. below, depending on whether it is a qualified sponsorship or a non-qualified sponsorship.
If a sponsorship arrangement does not meet the criteria to be considered a qualified sponsorship, the terms of the arrangement need to be reviewed with the Vice Chancellor for University Relations or designee or the Director of Business Services before being accepted or any acknowledgment provided. This is to determine whether there are UBIT or other implications related to the nature of either the acknowledgment or the return benefits. As part of that review, a determination will be made about the nature of any written agreement that will be required. If an alcohol company or distributor is involved or the sponsorship consists of a Gift-in-Kind, see A.3., above or B.3., below. In some cases, it may be sufficient to provide the sponsor with a letter summarizing the nature and duration of the sponsorship and the specifics of any acknowledgment, incorporating or attaching the standard sponsorship terms and conditions (described below). In others, a more formal written agreement outlining the specifics of the arrangement and any special terms and conditions in addition to the standard sponsorship terms and conditions will be required.
When a sponsorship arrangement with a school, college, department or unit includes a Gift-in-Kind of products (not services), the school, college department or unit should prepare and submit a Gift-in-Kind transmittal form to Gift Management in Accounting Services prior to or at the time the Gift-In-Kind is accepted. The policies regarding acceptance of Gifts-in-Kind are found on the Accounting Services website. If the sponsorship involving the Gift-in-Kind is a qualified sponsorship, then the unit may proceed under item 1, above. If it is a non-qualified sponsorship, then the unit must proceed under item 2, above.
If a sponsorship arrangement contemplates either the use of university marks by the sponsor or an “official” sponsor designation, see the additional requirements at items D and E, below.
The University does not prepare or sign sponsorship agreements for RSOs. RSOs should consult the contracting guidelines in the Student Organization Resource and Policy Guide for pointers on entering into sponsorship agreements. While certain aspects of the university’s sponsorship policy only apply to university schools, colleges, departments and units, the provisions of this policy relating to unacceptable sponsorship, prohibited endorsements, and use of university trademarks and images apply equally to RSOs.
Campus units or RSOs seeking sponsorships for events held at campus facilities must reserve those facilities through the university’s Central Reservations Office. The unit or RSO is also required to execute a Sponsorship Addendum to Facility Use Agreement as part of the process for obtaining a facility use agreement from the Central Reservations Office.
Sponsorship payments are exempt from Unrelated Business Income Tax (“UBIT”) when the only return benefit to the sponsor is a qualified acknowledgment which is defined within the definition of qualified sponsorship.
Acknowledgments must be secondary and subordinate to the name, marks, and other representations of the university school, college, department, unit, program, or event to which the sponsorship relates. For example, a banner promoting a departmental conference should prominently identify the conference and the department, with sponsor logos or other acknowledgment placed on the bottom of the banner in a smaller script. Institutional or unit-specific policies may restrict locations on institutional web sites where acknowledgments may be placed. Additional detail regarding acceptable forms of acknowledgment is contained in University Facility Use Guideline G-15.
University Facility Use Guidelines G-15 and G-16 (found here) apply to sponsorship of RSO activities that take place in university facilities or on university lands.
In limited circumstances, a sponsor may be granted permission to use university trademarks, names, or logos but not without permission from the Vice Chancellor for University Relations or designee for such use. Sponsorship of a university or RSO activity or event itself does not automatically give the sponsor the right to use any university trademarks, names, or logos. Any request by a sponsor to use university trademarks, names or logos should be directed to Trademark Licensing, which office will process the request in accordance with applicable university policy.
Because the use of the term “official” in connection with a sponsorship activity may constitute a prohibited endorsement, the university will permit use of the “official” designation only under certain conditions. “Official” sponsorships are different than a standard sponsorship.
Use of the term “official” may be permitted and would not constitute a prohibited endorsement when:
Department X solicits sponsors for its annual conference. Company Y offers to supply ballpoint pens with the conference logo printed on them, in exchange for an acknowledgment of sponsorship. Company Y offers to provide an additional $500 in cash to offset conference expenses if its pens can be designated as the “official” pen of the conference. The value of the pens is below the “best judgment” purchasing threshold. The department documents that it has contacted two other pen vendors and neither expressed interest in supplying the pens on similar terms as offered by Company Y. The brochures and a page on the department’s website promoting the conference contain an acknowledgment of sponsorship, which includes Company Y’s logo and a designation of Company Y’s pens as the “Official Pen of the Department X Conference.”
In very limited circumstances, the Vice Chancellor for University Relations, in consultation with the Chancellor, may confer “official” status on an external partner as part of a sponsorship arrangement with the university that is not restricted to specific events or activities.
A school, college, department or unit may provide benefits to a sponsor in addition to an acknowledgment. In those situations, review by Administrative Legal Services or the Director of Business Services is required. There are two very specific considerations in this circumstance:
When a sponsor provides a Gift-in-Kind of goods or services to the university that would ordinarily be obtained through the purchasing system, providing tangible return benefits to the sponsor has the potential to be seen as circumventing purchasing requirements. If the return benefits provided to a sponsor are valued at $5,000 or less, the transaction is exempt from purchasing requirements. If the return benefits to the sponsor are valued at more than $5,000, and the value of the return benefits provided to the sponsor is 10% or less of the value of the goods or services provided by the sponsor, the transaction will still qualify as a sponsorship and not a purchase. If the return benefits to the sponsor are valued at more than $5,000 and exceed 10% of the value of the goods or services provided by the sponsor, then the purchasing rules apply to the transaction.
As noted previously, sponsorship is not subject to UBIT if the only return benefit to a sponsor is an acknowledgment and certain insubstantial other return benefits. Providing tangible benefits to a sponsor has the potential to make the entire sponsorship payment subject to tax. The nature of the return benefits must be evaluated to determine if UBIT applies to the sponsorship. If the return benefits are sufficiently insubstantial (e.g., generally considered anything valued at less than 2% of the amount of the sponsorship payment), no portion of the sponsorship payment is subject to UBIT. Because this is a complicated area, with exceptions that apply in certain limited circumstances, schools, colleges, departments or units who contemplate providing return benefits to sponsors other than those listed above need to seek assistance from Administrative Legal Services or the Director of Business Services to determine if any UBIT issues are present.