New donation guidelines take effect

In April 2022, units and projects that had been receiving donations from abroad were informed that the Funds and Assets Management Committee constituted by the Governing Board of the Auroville Foundation had come up with a process to ensure compatibility with the Foreign Contribution Regulation Act (FCRA). Thus far, all foreign donations had been received in the Unity Fund with the donor earmarking the beneficiary, and the Unity Fund executives then transferring the donation from the Unity Fund account to the unit’s or project’s account.

The new process put a stop to this simple mechanism. Now a budget proposal or a paper describing the project, indicating those responsible for the utilisation of the donated funds, and a clear financial and narrative quarterly and yearly reporting about how the funds are utilized would be required. A monitoring team was to be created to ensure that all required information is obtained before donations received in the Unity Fund would be disbursed to the beneficiary and that the reports would be submitted in time. Beneficiaries were informed that no funds would be disbursed unless these process points had been completed; and they were warned that 80% of funds received must be utilized in the same financial year.

But for almost a year nothing happened. In July 2023, beneficiaries were informed that Guidelines for the channeling of donations had been crafted by the GB-FAMC, which would serve as a foundational document for the operations of the Donation Channeling Group (DCG), a subgroup of the GB-FAMC.

The GB, in its 65th meeting held on 12th December 2023, approved the constitution of the DCG. In January 2024, the DCG informed the beneficiaries that (1) Units and projects seeking donations for the first time must register before commencing fundraising activities; (2) all units and projects currently receiving or intending to receive donations need to file a “Project Registration Form” (PRF); that (3) a “Donor Information Form” (DIF) must be filled for every donor, ensuring comprehensive documentation of donor information; and (4) that for every request for withdrawal of funds from the Unity Fund, a “Funds Release Form” (FRF) needs to be filled in. The DCG warned that only units and projects registered with the DCG will be eligible to receive donations through the Unity Fund or via donation portals; and that non-compliance of the guidelines may result in a pause in fund releases or even the replacement of project holders.

Release of funds is also conditional on the payment by the unit of its profit contribution and payment of the City Service contributions for or by those who work for the unit. The key highlights of the new process include an Approval Mechanism – PRFs will be processed within seven working days of submission, with rejection subject to discussion with project holders and the FAMC; the introduction of “Project Assessment Criteria” – projects are evaluated based on their alignment with Auroville’s ideals, sustainability, and tangible outcomes; and Compliance Enforcement – failure to comply with guidelines may result in fund release delays or further disciplinary actions. The DCG said that donor information will be treated with utmost confidentiality and disclosed only as required by statutory obligations.

Yet, the process did not take off. In March 2024, the DCG wrote that, though the Unity Fund had received donations for units and projects in the first months of the Financial Year 2024-2025, funds were not released “as the DCG was waiting for updated Guidelines for book-keeping specific for donations from the Auditors,” and that “Once received, approved and communicated to the Community, the release of funds will start.”

In the beginning of June this year the green light was given – apparently by the Governing Board in its meeting of May 31st – and units and projects who had received donations were invited by the DCG to send it to the FRFs.