Newport Beach, Calif. — When the National Association of College and University Business Officers released its annual survey of university endowments last week, the top 20, as always, were dominated by private institutions. Indeed, only five public universities broke into the top 20.
How can that be when public universities educate 80 percent of American students, and so have a much bigger alumni base from which to draw donations? That was one of the questions debated by a panel of experts at a session this morning at a conference for leaders and chief executives of public-college foundations with assets above $100-million. The event was sponsored by the Association of Governing Boards of Universities and Colleges.
“The potential is there that, in 40 years, state-university foundations could appear more often among the largest endowments in the country,” said William F. Jarvis, managing director of the Commonfund Institute.
Today, 24 public institutions have endowments of $1-billion or more. Mr. Jarvis argued that both numbers would only grow as pressure builds on public-university foundations to help their primary institution, while public resources such as federal grants, state appropriations, and tuition are being squeezed by other demands.
“Privates are very fearful of the awakening of public universities,” said Doug Freeman, chairman of the University of California at Irvine Foundation. “They perceive this as a challenge.”
Well, maybe not all privates, said Gerald B. Fischer, president and chief executive of the University of Minnesota Foundation. He doesn’t foresee a day when public institutions will overtake the big private endowments, like those of Harvard and Yale. He noted that Harvard’s one-year growth in its endowment last year, from $28.9-billion to $34.6-billion, was more than twice his entire endowment of $2.5-billion. “It’s hard for me to see publics catching up,” he said.
At the same time, he said, he worries that the private universities will use their large endowments to further separate themselves from prestigious public colleges. “If Harvard discounts tuition to a point where they offer the equivalent of a private-college tuition at a public-university price, we’ll never be able to compete for top faculty or top students.” —Jeffrey Selingo
