Q: We have a next-generation board with five college-age family members who travel from all around the country to meet, review grant proposals, and recommend grants to the governing board. Is it legal to reimburse them for travel expenses?
Spouses and children of board members are disqualified persons. If foundation assets are paid to them for travel or related expenses, such payment is an act of self-dealing.
However, if the spouse or child has official duties that further the charitable purposes of the foundation, such as those of a next-generation board member, then reimbursement of reasonable expenses for foundation activities, such as travel, is not a violation of the self-dealing rules.
For an easy reference on disqualified persons and the self-dealing rules that govern foundations, consult John Edie’s Self-Dealing: A Concise Guide for Foundation Board and Staff published by the Forum of Regional Associations of Grantmakers.