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FUNDAMENTAL CONCEPTShold, invest, and administer property and to make expenditures to or for thebenefit of a college or university (including a land grant college or university),which itself is a public charitable organization 374 and which is an agency orinstrumentality of a state or a political subdivision of a state, or which is ownedor operated by a state or political subdivision of a state or by an agency orinstrumentality of one or more states or political subdivisions. 375GOVERNMENTAL UNITSA governmental unit is a public charitable organization and thus is not a privatefoundation. 376 This category includes a state, a possession of the United States,or any political subdivision of either of the foregoing, or the United States or theDistrict of Columbia. 377Publicly Supported Organizations—Donative EntitiesGENERAL RULESAn organization is not a private foundation if it is a charitable entity that “normallyreceives a substantial part of its support” (other than income from a tax-exemptfunction) from a governmental unit 378 or from direct or indirect contributions fromthe general public. 379The primary way for a charitable organization to achieve nonprivate foundationstatus under these rules is for it to normally derive at least one-third of itssupport from qualifying public and/or governmental sources. 380 Thus, an organizationqualifying as a publicly supported entity under these rules must maintaina support fraction, the denominator of which is total eligible support andthe numerator of which is the amount of support from eligible public and/orgovernmental sources.For these purposes, the term support means amounts received as gifts,grants, contributions, membership fees, net income from unrelated businessactivities, gross investment income, 381 tax revenues levied for the benefit of theorganization and either paid to or expended on behalf of the organization, andthe value of services or facilities (exclusive of services or facilities generally furnishedto the public without charge) furnished by a governmental unit to theorganization without charge. 382 All of the foregoing items are amounts that, ifdirectly or indirectly received by the organization, constitute the denominator ofthe support fraction.In computing the eligible amount of public support (the numerator of thesupport fraction), contributions from individuals, trusts, or corporations constitutepublic support to the extent that the total amount of contributions from any374 See § 3.4(a), text accompanied by notes 356–359.375 The rules concerning these supporting foundations are discussed in Tax-Exempt Organizations § 11.3.376 IRC §§ 170(b)(1)(A)(v) and 509(a)(1); Reg. § 1.170A-9(d).377 IRC § 170(c)(1). The rules concerning governmental units are discussed in Tax-Exempt Organizations §§ 6.9,11.3, and 18.7.378 See § 3.4(a), text accompanied by notes 376, 377.379 IRC §§ 170(b)(1)(A)(vi) and 509(a)(1).380 Reg. § 1.170A-9(e)(2).381 IRC § 509(e).382 IRC § 509(d); Reg. § 1.170A-9(e)(7)(i). 108