2008 Woodie Awards
Vote Absentee
Endowments for UA on rise
Rate of private financial gifts ranks in top fifth nationally
By: Kim Hill
Issue date: 3/24/08 Section: News
|
The university received $532 million in endowments - financial gifts from private donors - in 2007. That figure ranked 136 out of a listed 785 institutions in reports from The National Association of College and University Business Officers.
In 2006, the UA received $466 million in endowments and was ranked 133 out of 765, according to the reports.
With the average endowment total for the listed universities at $91 million for 2007, the UA resides in the top 20 percent.
"The numbers of private donations to the UA have gone up quite a bit in the last couple years," said Johnny Cruz, the university's director of media relations.
Endowments are important for universities because they "provide a lifetime income stream," said John Brown, director of communications and marketing for the UA Foundation, a private company that manages the university's endowments and gifts.
Endowments, once given, go to support anything the donors wish.
Last month, UA alumna Stevie Eller funded an endowed faculty chair in the School of Dance, largely to keep program head Jory Hancock at the university.
In January, alumni J. David and Edith Lowell donated $4.5 million to support construction of a new basketball and volleyball practice facility and a new program in mining and geological engineering.
The UA Foundation manages more than 1,200 endowments, which constitute a $310 million portfolio and an asset base of about $450 million, Brown said.
All that money is pulled together and invested through a committee that helps the UA Foundation manage the portfolio, he said.
Donors may structure their gifts differently, but the basic endowment works as follows: If, for example, someone donates $1 million, the university puts it in the bank and the interest accrued is what the university spends, Brown said.
The UA's minimal return target, or interest made off an endowment, is 8.75 percent. That figure includes a cost-recovery fee of 1.25 percent, a 3.5 percent fee meant to keep the endowment's value ahead of inflation and a 4 percent payout rate.
The money from the payout rate goes to the area the endower wishes to aid, Brown said, adding that the UA's rate is slightly below the national average of 4.5 percent.
Donors can specify different situations in terms of interest rates and how the endowment is designated, he said.
Policy on posting: The Arizona Daily Wildcat would like to offer readers an opportunity to voice their opinions and engage in community conversation. However, readers should refrain from personal attacks or advertisements in their comments. When a reader chooses to participate in the Wilcat's online comments, they should be aware that all comments and postings do not reflect the views of the publication. Links referencing different sources for the sake of discussion are tolerated and encouraged, but comments and links that are posted only to advertise other sites will be deleted at the discretion of the Wildcat.
Viewing Comments 1 - 1 of 1
Marvin L Foushee
posted 3/24/08 @ 5:28 PM PST
"The university received $532 million in endowments - financial gifts from private donors - in 2007."
Actually, the University of Arizona increased its endowment to $532 million in 2007, up from $467 million in 2006--a net increase in the university's endowment fund of 14. (Continued…)
Post a Comment