Chair Hatchett asked Dr. Lyons to discuss the sources of monies received by the Foundation and how the Foundation manages those financial resources.

Chair Hatchett asked Dr. Lyons to describe the mechanics of the Foundation's investment-making decisions.

Relative to the Tri-Annual Report Dr. Lyons provided to Committee members, Chair Hatchett asked Dr. Lyons to explain the variation between certain lines in the statement and the financial position from year to year.

Regent Moyer queried, as to monies invested in the Foundation's endowment accounts, what basis is being used on the payout to make distributions from those accounts on an annual basis. Is it based on the current year's balance in the account and a particular rate of return? Or is it a three-year rolling average?

Regent Moyer also asked if payouts were made from endowment accounts if an account's balance was less than the initial endowment.

Regent Moyer further inquired what the payout rate is that the Foundation averages on its endowment on an annual basis.

Regent Moyer asked, assuming that in the previous year the account had a balance equal to the initial endowment, how the amount to be paid out is determined in subsequent years. Is it based on the single-year performance? Is it based on a three-year rolling average performance? Or is it based on some longer-term rolling average performance?

Regent Moyer asked what it costs the Foundation for Baird to manage the endowment, and requested that Dr. Lyons provide the Committee with last year's monthly reports from Baird.

Dr. Tidwell asked if there were other uses for Foundation funds above and beyond the direct support of KSU students.

Relative to the Foundation's most recent external audit, Regent Fletcher asked if there were any findings and if so, were they addressed.

Chair Hatchett asked Dr. Lyons for his perspective on the University's fundraising, and queried whether the Foundation is involved those activities.

Chair Hatchett asked Dr. Lyons if he was aware of distributions being made to students as graduation gifts and if so, what source of funds was used to make those distributions. Dr. Lyons described several sources of funds.

Following Dr. Lyons' reply, Chair Hatchett and Regent Dukes each asked Dr. Lyons to clarify his assertion that CARES Act funding had been among the funding sources used to make graduation gifts to students. Regent Dukes asked how the Foundation had received CARES Act funds.

At this point, Attorney Han interjected, stating that this discussion was within the scope of the agenda, as it also pertained to agenda item XIII.

Chair Hatchett then invited Mr. DeCourcy to comment. Mr. DeCourcy stated that he wanted to be clear that as to the disbursement request in question, Attorney Han and the Office of General Counsel would provide documentation to determine exactly where a graduation gift came from; however, it did not come from CARES Act or HEERF funding. Mr. Decourcy further noted that Dr. Lyons had stated that he was not 100% sure that the graduation gifts came from HEERF.