As New York”™s governor lines up support for a $4 billion infusion into the state”™s university endowment, Connecticut officials are mum on the prospect of any similar effort for the University of Connecticut, even as UConn”™s foundation begged the state for long-promised matching funds to support a new capital campaign it plans to launch next year.
UConn had a $338 million endowment in 2007, according to the National Association of College and University Business Officers (NACUBO), competitive with its closest peer schools in the region. The University of Massachusetts had a $350 million endowment last year supporting triple the undergraduate population of UConn. In New Jersey, Rutgers University had a $654 million endowment with nearly double UConn”™s student population.
Whereas UMass numbered among the national leaders in endowment growth at 35 percent, however, UConn managed a relatively meager 15 percent appreciation in its endowment.
Harvard University has the largest endowment in the nation at $34.6 billion, followed by Yale University at $22.5 billion.
Gov. Eliot Spitzer has proposed selling New York state”™s lottery to private investors, and from the estimated $50 billion in proceeds devoting $4 billion to the endowment of the State University of New York (SUNY).
Spitzer estimated last month that would throw off $220 million annually ”“ or about $500 for each of the 415,000 students in the system.
SUNY”™s endowment currently totals $566 million, according to NACUBO.
“I am not aware of another state depositing such a large amount of public funds into an endowment,” said Matt Hamill, senior vice president of advocacy for NACUBO. “The normal course of affairs has these public endowments being built up over time by donors. There are some parallels with how states used tobacco settlement funds, but I don”™t think the (New York) experiment has been done before.”
A UConn spokeswoman did not make new university President Michael Hogan available for comment on the school”™s endowment, referring questions to the University of Connecticut Foundation, which at deadline had not responded to the inquiry.
The private University of Connecticut Foundation manages the school”™s endowment. UConn Foundation President John Martin previously led university relations at the University of Bridgeport, his alma mater.
Addressing the Connecticut General Assembly last month, Martin pleaded for legislators to remove limitations pegged to the state “rainy day” fund on contributions to the UConn Foundation.
“As we sit down with donors and we ask them to consider gifts for endowment, everyone is seeking leverage,” Martin said. “My response has to be, ”˜well, now you see it, now you don”™t; because, yes, we do have a matching gift of 25 percent, but it might not be available if in fact the rainy day fund is not fully funded.”
What”™s more, the latest NACUBO figures come against a backdrop of uncertainty for endowments as repercussions from the subprime mortgage collapse still ripple through the economy.
“Until they report their year-end numbers, we won”™t know the fallout for foundations and endowments,” said Susan Mangiero, CEO of Pension Governance L.L.C. in Trumbull.
Money raised for UConn has yo-yoed in recent years, due to the vagaries of the economy and the timing of capital campaigns. During the recession of 2001 and 2002, gifts and other contributions to the endowment plunged 24 percent to $50 million. After rebounding back up to $75 million in 2004, money raised ebbed back to $44 million before bouncing back up to $60 million in fiscal 2007.
Between June 2004 and June 2005, the UConn Foundation”™s market value of equity securities portfolio increased 45 percent, and the foundation recorded a $22 million net gain that year from the sale of securities.
The school”™s endowment was sufficient to provide $11 million in scholarships for UConn students; and $9 million to supplement compensation for professors and support staff. Another $12 million went for general campus and program improvements and other items.
Early this decade, Connecticut passed a bill to match, dollar for dollar, up to $20 million in funding raised by UConn, which the school tapped out. A second bill followed authorizing a 50-cent match for every dollar raised, but the state has yet to fulfill the commitment.
A $470 million fundraising campaign completed in 2004 included a donation of engineering design software valued at $146 million from Plano, Texas-based Electronic Data Systems Corp.; and a $23 million gift from Ray Neag, a former vice chairman of medical-device maker Arrow International. Neag and his wife Carol subsequently donated $10 million more for a cancer center at the UConn Health Center in Farmington.
