2015-16 Guide to Philanthropy

A guide to

A G U I D E TO

Philanthropy AT H A R K E R 2015-16

Giving

I am hugely grateful for parents who give through annual giving. Through their generosity, I am able to get the materials I need to provide a top quality science education. I am able to purchase labs, equipment and consumables that enable me to focus on my teaching rather than how to obtain the tools for teaching.

Thank you. — Dr. Thomas Artiss, Gr. 8 Science teacher

Message from the Head of School The Harker School’s mission is to bring out the best in our students – in academic, extracurricular and personal domains – so that they can make a positive difference in the world.

Over the years I have been heartened to see our Harker community come together with philanthropic support that enables students to do just that. The combined efforts of our donors each year offer our students more robust opportunities inside and outside of the classroom, and in the long term philanthropy also provides improved facilities for our student body for years to come.

Harker is an independent private school. This means that Harker does not receive funds from government, religious or other organizations. We must raise all funds for operations and capital improvements through tuition and fees, annual charitable contributions, and capital contributions.

As an independent school, Harker follows the Independent School Financial Model. Independent schools depend on charitable giving to provide enhancements to student programs.

At Harker, these annual enhancements – our Margin of Excellence – are funded by annual giving (see page 4).

While gifts to the annual giving campaign support the school’s annual operations and fund educational enhancements for the children every day, capital and endowment gifts have a long-term benefit. All of these types of gifts are necessary to sustain Harker’s educational excellence into the future.

Last year we launched the Rising to the Challenge campaign in support of both annual giving (for student programs) and capital giving (for the construction of a gym and theater on the Saratoga campus). I am grateful for the response by our community, enabling us to meet the $10 million Rothschild matching gift challenge.

While we have achieved this significant milestone, it’s important to note that our work is not yet done raising funds for the gym and theater. I am sincerely thankful to those families who have participated by making multi-year annual giving pledges and capital giving pledges. I encourage those who haven’t had a chance to do so yet to join the community with their support.

There are many different ways to support The Harker School with your philanthropy. Thank you for taking the time to learn about the various charitable options available.

Sincerely, Christopher Nikoloff Head of School

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Frequently Unasked Questions Harker has a continued tradition of charitable giving, and these gifts help to create the best possible learning environment for our students. Every aspect of the school is touched by annual giving, including academics, the library, technology, the arts, athletics, and other student activities.

It is our philosophy that all members of our school community should support annual giving at a level that is appropriate for their situations; most importantly, we want our donors to feel good about their contributions.

Parents often come to Harker with very different views of and experiences with philanthropy, and many have questions. To help provide a better understanding of Harker’s philanthropic philosophy, we provide this list of frequently unasked questions, featuring topics you may have questions about but may be uncomfortable asking.

Why does Harker have the annual giving campaign?

Harker, like all independent schools, relies on income beyond tuition to fully support its students and programs. Gifts to annual giving are used in the year in which they are received, and so Harker depends on these donations to support current student programs each year. In fact, making a gift to annual giving has the most direct and immediate impact of any type of gift to the school.

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Why doesn’t Harker operate like other businesses and charge the full cost instead of asking for donations each year?

The tuition that would be necessary to fund our current level of education would restrict the number and type of families who could afford to attend. This would limit enrollment which, in turn, could mean a cutback in programs and opportunities for students.

In addition, a for-profit business can cut costs through consolidation and streamlining. To employ these strategies at Harker would mean reducing staff or combining classrooms, making us unable to provide the individual attention and quality of education that everyone wants and expects for Harker students.

Finally, a gift to annual giving is tax-deductible. Tuition is not.

What if I don’t like something at Harker and feel the only way to be heard is to withhold support from annual giving?

We ask that you please contact the person involved or a school administrator. Please do not jeopardize the students’ educational experience to make your point, but instead handle it directly and appropriately. Harker encourages open discussion and strives to communicate effectively with all members of the school community.

Does annual giving pay for faculty and staff children’s tuition remission at Harker?

No, annual giving is not used for this purpose. However, it is important to note that, as in most independent schools, faculty and staff do receive tuition remission as an employee benefit. This initiative has been critical in helping us to retain high quality teachers and staff members in a geographic location where other industries often pay far more. Attracting and retaining the highest quality faculty and staff is one of the most important and desirable features for parents, and tuition remission has proven to be one of the most effective techniques towards achieving this goal. In addition, having their own children within the community makes faculty and staff more personally invested in building a vibrant and cohesive school environment.

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INDEPENDENT SCHOOL FINANCIAL MODEL

ANNUAL O PERATIONSS

Tuition & Fees

Annual Giving

Salaries

Provides the Margin of Excellence

Benefits

Student Programs & Services

Mortgage

Athletics

Taxes & Utilities

The Arts

Insurance

Clubs

Core Academic Extracurricular Programs

Field Trips

Maintenance & Operations

Technology

Some Capital Additions

Library

The Harker School is a nonprofit organization, tax ID# 94-1613808. The IRS allows people to make tax deductible gifts to 501(c)(3) nonprofit schools like Harker. Thus families can take advantage of this opportunity to direct dollars to help support student programs at Harker using funds that might otherwise go to the U.S. government in the form of taxes.

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Ways to Give Outright Gift You may make a gift online using a credit card or via ACH (electronic check). Simply go to www.harker. org/onlinegiving. Or you may complete the annual giving pledge envelope (stapled into this brochure), and do one of the following: enclose a check*; provide your credit card information; make a pledge of a specific amount and pay it before May 31, 2016. * When you provide a check as payment, you authorize us to either use the information from your check to make a one-time electronic funds transfer from your account or to process the payment as a check transaction.

Gifts of Securities Transfer stock by mailing or faxing your completed Transfer of Securities form. Click on “Support Harker” on the Harker website to download the form.

In-Kind Gifts of Tangible Personal Property Click on “Support Harker” from the Harker homepage to download the in-kind gift proposal form. You may then submit the form to the in-kind gift acceptance committee for review. Once it is determined that we can accept the gift, we can make arrangements to receive the property and provide you with a letter of tax deductibility.

Matching Gift Many gifts to The Harker School also qualify for corporate matches. Please check with your employer on matching gift policies. You can begin the matching gift process by obtaining a matching gift form from your company’s human resources department. Complete and mail the form to us with your gift or pledge payment. Some corporations handle this process online.

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Planning Your Gift Annual Gifts Each family is asked first to make a gift every year to the annual giving campaign. The greatest percentage of each dollar donated via the annual giving campaign goes to student programs. After a family has made their primary gift to the annual giving campaign, there are two events, the picnic and Night on the Town, that provide fun and entertainment to everyone while generating funds for the endowment. Everyone is welcome to join the fun and participate.

Periodic Gifts Each family will be asked to make a gift to our capital campaign at some point during their time at Harker, and that time is now. We are continuing this year to raise funds to build a gym and theater on our Saratoga campus.

Deciding How Much to Give We ask Harker families to contribute to annual giving at a level appropriate to their financial situations. The average gift per child is $1,000. However, since each family has a unique financial situation, the fairest way to achieve the funding needed for the Margin of Excellence is to have all families participate by giving a similar percentage of their annual incomes; families with higher annual incomes may be able to contribute more money than families with lower annual incomes. This way each gift, no matter how big or small, is meaningful and matches a donor’s capability to give.

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Rising to the Challenge Last year, we launched the Rising to the Challenge campaign which encompassed multi-year pledges to annual giving and capital giving and helped us to meet the Rothschild $10 million matching gift challenge.

However, we still have more funds to raise to be able to complete the gym and theater complex.

Families who made multi-year pledges will receive pledge reminders from the school. New families who have not yet participated in annual or capital giving are encouraged to join the community to achieve these goals and provide students with the programs and facilities that their amazing efforts merit.

“We support annual giving since it materially affects both our children’s learning experience and overall excellence provided by the school. From the exciting trips to the symphony or jazz concert to the extra sports activities, uniforms, tournaments and games, annual giving provides that special touch that makes our children’s experience that much more rewarding.”

— Bob Schick, Parent (Gr. 11 Student)

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Annual Giving Gift Clubs Each year we recognize donors in our online Annual Report, according to these gift clubs: Leadership Circle

Gifts of $25,000 and above

Benefactors’ Circle

Eagles’ Circle

Gifts of $10,000-$24,999

Head of School’s Circle Gifts of $2,500-$4,999

Trustees’ Circle

Gifts of $7,500-$9,999

Graduates’ Circle

Gifts of $2,016 (families of graduating seniors)

Ambassadors’ Circle

Gifts of $1,000 and above

Alumni Leaders

Gifts greater than Pacesetter amount

Alumni Pacesetters

Gifts of $5 per number of years since graduation (e.g., $5 x 5 years = $25)

Friends

Gifts up to $999

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Gifts of $5,000-$7,499

Designating Your Gift Unrestricted Gifts Unrestricted gifts to the annual giving campaign are most appreciated by the school because these gifts provide us with the opportunity to fund the approved items requested by the faculty for their programs.

Designated Gifts* You can also designate your contribution to one of the following programs: Athletic Boosters

Friends of Debate

Financial Aid

Patrons of the Arts

Friends of Robotics

Business and Enterpreneurship

Friends of the Library

Friends of Journalism

Memorial or Honorary Gifts Pay special tribute to a family member, friend, colleague or group by making either a restricted or unrestricted gift in memory or in honor of someone. * If your gift is designated, please specify on your check, when giving online, or when transferring securities to which program you would like your support designated.

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Planning Your Philanthropy 2015-16 Annual Giving Campaign Pledge Week: Oct. 4-11, 2015 Annual giving is the school’s main effort to raise money for student programs (such as athletics, the arts, technology, library, and much more); it funds our immediate needs as requested by teachers, department heads and the administration.

Our phoneathon takes place the week of Oct. 5 this year, but you don’t have to wait for a phone call.

You can go ahead and make your gift online or use the envelope provided.

All gifts are fully tax deductible and directly support the Margin of Excellence extras that enrich the overall student experience. We ask that you make your first and primary gift each year to annual giving to support the Margin of Excellence.

Capital contributions support the purchase, construction and upgrading of buildings and facilities to meet student needs. Usually gifts made for this purpose are multi-year pledges spread over a three- to five-year period. Like annual giving gifts to Harker, capital gifts are tax deductible.

Last year most of our families took part in the Rising to the Challenge campaign and made multi-year pledges to both annual giving and capital giving. We are not yet finished raising the funds to construct the gym and theater complex on our Saratoga campus, and we will be reaching out to new families and families who haven’t pledged yet to take part.

See the Harker website for information about tax deductibility of gifts.

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Event Giving Family & Alumni Picnic Sun., Oct. 11, 2015 Join us for Harker’s 65th annual Family & Alumni Picnic! The entire Harker community gathers together each fall to kick off the beginning of the new school year. More than a “picnic,” the event includes games and prizes galore, great food, fantastic student entertainment, our ever-popular silent auction, fun-filled themed activities and more! For how to get involved, see page 15.

The Harker Gala | Night on the Town Levi’s Stadium • Fri., Feb. 26, 2015 Night on the Town will take place at Levi’s Stadium, just after Superbowl 50. This exciting and elegant venue gives us the opportunity to highlight past and current Harker athletes. Dinner will feature different food types and cuisines at various stations - you’ll want to try them all! The evening will also be highlighted by roving entertainers, casino games, and a silent auction. This event provides a fantastic opportunity for parents and guests to socialize in a lively and elegant environment. And it’s all for a great cause because all proceeds benefit Harker’s endowment. For how to get involved, see page 15.

Planned and Endowment Giving Harker has recently established a general endowment and two restricted endowments in honor of former history teacher John Near, one funded by Jim and Pat Near, and the other by the Mitra family. Restricted endowments can be established with gifts of $100,000 or more. Gifts in any amount can be contributed to the general endowment or to an existing restricted endowment.

While most types of gifts (cash, securities, real or tangible property, IRAs) can be given to an endowment outright, it can be advantageous to make a “planned gift” to the endowment or other Harker funds as a part of your estate plan.

Bequests are the most common “planned gift” given to schools. Please consider naming Harker as a beneficiary of a specific amount, a percentage or a residual portion of your estate in your will.

Families making “deferred planned gifts,” such as privately held stock or equity funds, or “revocable planned gifts” such as bequests, charitable remainder trusts or charitable lead trusts, become members of the Nichols Planned Giving Society. “Irrevocable gifts” are credited to the donor at the net present value of the gift.

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Gifts Honoring the Senior Class Graduates’ Club/Senior Brick Program Families who contribute $2,016 (for the Class of 2016) or more to annual giving become part of the Graduates’ Circle gift club. Their graduating senior receives a brick inscribed with his/her name and class year in Graduates’ Grove on the upper school campus. Families participating in the Senior Brick Program are also included in the Senior Parent Appreciation Gift and are invited to the Head of School’s Circle Celebration.

Senior Parent Appreciation Gift The Harker Senior Parent Appreciation Gift is a way for parents of graduating seniors to honor their students by making a gift in honor of the time their students have spent at Harker.

Participation in the Senior Parent Appreciation Gift is based on incremental giving. Senior families who make a donation to annual giving that is greater than the gift made the previous year will be included as participants in the Senior Parent Appreciation Gift. These incremental dollars will go to a Class of 2016 fund within Harker’s general endowment.

Students whose parents participate in this program have their names included on a permanent plaque on campus. The Senior Parent Appreciation Gift enables graduating classes to leave behind a legacy for future Harker students and is in recognition and appreciation of the fine education and wonderful memories that Harker has provided.

Senior Class Gift The senior class gift is funded by donations contributed by the graduating seniors themselves. Working with the school administrators, the students select a project to be funded.

The Class of 2015 raised more than $5,000, which funded a student lounge area outside Shah Hall.

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Alumni Giving Harker Alumni: Every year we ask alumni to make a gift to the annual giving campaign as a way to give back to their school and to the students currently attending. In addition, alumni may choose to contribute to capital campaigns and/or endowment funds. Planned gifts are also an excellent way to leave a legacy at Harker.

Alumni Pacesetters & Leaders: For our young alumni, we especially appreciate participation at any level. The Pacesetting gift amount is $5 for each year since graduation.

For more information, contact Karri Baker ‘84, director of alumni relations, at karri.baker@harker.org or 408.345.9264.

Pacesetting Gift Amounts Class of* Years Since Graduation Gift Amount 2015 1 $5 2014 2 $10 2013 3 $15 2012 4 $20 2011 5 $25 2010 6 $30 2009 7 $35 2008 8 $40 2007 9 $45 2006 10 $50 *Your graduation year 2005 11 $55 is the year that your 2004 12 $60 cohort graduated from Harker, regardless of 2003 13 $65 whether you completed 2002 14 $70 your studies at Harker.

1997* 15 $75 The Class of ‘97 is the last graduating middle 1996 16 $80 school class. All subse1995 17 $85 quent alumni should 1994 18 $90 use their high school graduation year.

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Supporting Harker’s Two Main Fundraising Events

Harker Family & Alumni Picnic The Harvest Festival is a fun family event for the entire Harker community. More than a “picnic,” this event provides fun and games for the whole family. Proceeds from the picnic benefit the school’s general endowment.

The Harker Gala | Night on the Town This is an exciting dinner event with entertainment and a silent auction. Proceeds support the school’s general endowment.

If you would like to support either of these events, you may do so by: making cash contributions donating an auction item providing in-kind donations (gifts of tangible personal property)

volunteering your time and, of course, attending the event!

Contact director of special events Danae McLaughlin at danae.mclaughlin@harker.org to find out more.

Contributing gifts of cash or personal property can also provide donors with tax deductions. Sponsorships paid through charitable foundations may not receive sponsorship benefits according to foundation regulations.

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I feel so fortunate to teach English at Harker with all the opportunities I can give my students, thanks to Annual Giving. The students are able to write essays on their Chromebooks with ease, and with Hapara I can access their work and provide them minute-byminute feedback. I also have a printer in my classroom for the final product, so it’s like I am managing a fully functional “writing factory” on a weekly basis.

— Kate Shanahan, Gr. 5 English teacher

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Capital Giving The Harker School’s Cornerstones for Success Campaign, our multiyear, multiphase capital campaign, is based on the central concept that an outstanding Harker education consists of four “cornerstones”: outstanding students, motivating faculty, quality curriculum and outstanding facilities. We are working to bring the standards of our facilities up to the standards of our students, faculty and curriculum.

We have completed the first four phases of the master site plan and now are working to build an events center on our Saratoga campus. A new gym and theater for our upper school will provide students and teachers with much-needed facilities appropriate to their programs.

Capital gifts are usually larger than annual gifts and can be paid over a number of years. In addition to having their names listed on the capital campaign donors’ wall, donors may “name” a space on campus in recognition of their gift.

Gift club ranges are as follows: Leading Visionaries $2,500,000+ Visionaries

$1,000,000 to $2,499,999

Harker Group

$100,000 to $999,999

Leadership Group

$25,000 to $99,999

Friendship Group

$2,500 to $24,999

Community Group Up to $2,499 For information about investing in capital giving at Harker, please contact Joe Rosenthal at joe.rosenthal@harker.org.

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Endowment Giving An endowment fund is money that remains largely intact in perpetuity and is carefully invested to earn income that is used to support the school. Endowment is critical to The Harker School’s long-term financial stability. Donors can make contributions to our existing endowment funds in any amount.

The Harker School General Endowment The school’s most critical and fundamental endowment is a quasi-endowment known as The Harker School general endowment. Established by the Board of Trustees to provide a major source of support for the school, the general endowment is composed of unrestricted funds and enhances the school’s ability to sustain itself, evolve and grow, hire and retain outstanding faculty and staff, attract and nurture gifted students. The Harker School general endowment is overseen by the audit committee of the Harker Board of Trustees to provide a perpetual stream of income to the school.

Donors to the general endowment are assured that only the income generated from their gifts will be distributed, allowing the principal to remain intact. Harker welcomes gifts in any amount to the general endowment.

Donor-Restricted Pure Endowments A donor-restricted pure or named endowment is expended over time, as the donor has described in his or her gift instrument. Acceptance of gifts establishing pure endowments is subject to prior approval by the school, and endowment management and investment is in accordance with prevailing law. These pure endowments may fund faculty chairs, student financial assistance, curricular innovation, faculty development, academic initiatives or other special uses. They may be named for individuals, families or other honorees. A pure endowment can be established with a minimum initial gift of $100,000. An example of a pure endowment is The John Near Excellence in History Education Endowment Fund.

Deferred Gifts Fund Gifts to this Board-designated deferred fund, such as gifts of privately held stock or private equity funds, are used after they materialize and/or are redeemed.

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Planned Giving A planned gift is defined as, “a mediated gift, that is, a gift which a charity receives through or by means of an agency, such as a will, a contract or a trust.” Planned giving is often a part of a family’s estate planning. Planned giving does not always need to be associated with a death for the tax incentives to be advantageous to a donor.

There are numerous vehicles and strategies available for individuals and families to maximize the benefits that come from making a planned gift. Some planned gifts bring funds to charities right away, others defer gifts to the charity until a later date. Some can be adjusted (revocable) and others cannot be changed (irrevocable).

For more information please contact Joe Rosenthal, executive director of advancement, at joe.rosenthal@harker.org.

Types of Planned Gifts Bequest through a living trust or will Gifts of privately held stock Gifts of private equity funds Naming Harker as the beneficiary of your life insurance policy Gifts of real estate, insurance policies or IRAs Gifts of a trust: CRT, CLT or an Insurance Replacement Trust

Estate Planning Planned gifts are commonly made as a part of a person’s estate plan. For many of us, estate planning is something we know we should do, but somehow manage to put off. While understandable, it is not wise.

There is simply too much at stake. Estate planning involves the accumulation, conservation and distribution of assets. Your “estate” is your real and personal property which you intend to use to benefit yourself, your family and your community.

With good planning, one can substantially increase the amount that one leaves to heirs and to favorite charities.

The Nichols Family Planned Giving Society The Harker School recognizes those who make a planned gift by enrolling them in the Nichols Family Planned Giving Society. Becoming a member of the Nichols Family Planned Giving Society is simple — all you need to do is notify us that Harker is a part of your estate plan.

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How Gifts are Recognized We provide you with a letter of tax deductibility for all gifts greater than $75 (as required by IRS regulations), and for most gifts less than that amount. Our goal is to mail you this letter within three days of your making your gift, but during our heavy donation times this time frame may be extended. If you haven’t received your letter within two weeks after making your gift, please contact our office so that we can make sure your donation hasn’t been lost in the mail or otherwise missed.

In January of each year, we provide you with a letter of tax deductibility for specific charitable donations you’ve made in the previous calendar year, to help you in filing your taxes. This letter includes gifts to annual giving, capital giving, endowment giving and event giving.

If you have questions about your letter of tax deductibility, or if you haven’t received yours, please contact our director of stewardship, Allison Vaughan, at allison.vaughan@harker.org.

Recognition & Thanks Website We are very grateful for the charitable contributions we receive, which benefit all students, and we are happy to recognize our generous donors. All donors are listed on our Recognition & Thanks website (http://rt.harker.org), which is updated monthly. Those who have pledged are listed in gray, and those who have made their gifts are listed in black. When you make a gift, you may want to check the website to make sure your listing is accurate. If you have any corrections or questions about your listing, please contact our director of stewardship, Allison Vaughan, at allison.vaughan@harker.org.

Head of School’s Circle Celebration For those donors who make a gift to annual giving of $2,500 or more, Chris Nikoloff hosts the Head of School’s Circle Celebration. The evening includes stories from students about how annual giving donations have benefited them in their educations, entertaining student performances, festive company, and elegant food and drink. In order to be included in this special evening, please make your gift before April 1, 2016, as the event is held at the end of that month.

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Thank you

Harker Advancement Office 500 Saratoga Avenue • San Jose, CA 95129 408.249.2510

Contact Information Joe Rosenthal Executive Director of Advancement 408.345.9266 joe.rosenthal@harker.org

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Melinda Gonzales Managing Director of Advancement 408.345.9621 melinda.gonzales@harker.org