Wesleyan’s annual Financial Report was published last week, and the endowment is up 12%, if you exclude the $28 million siphoned off to pay for current operations, but add the pledges from the “This Is Why” campaign. Additionally, the university took in $11 million more in income than it spent in the fiscal year that ended last June. This should be good news for all those who are disgruntled by the need-blind situation. We’re on our way to having enough money to spend on basic operations, and maybe return to need-blind. This won’t happen soon, but it’s at least a positive step forward.
In Fiscal Year 2012/13:
- Alumni, parents, friends, lovers gave $42 million in cash to Wesleyan, an $11 million increase from the prior year
- 46% of alumni donated funds
- $55 million in new gifts (cash, pledges and bequests)
- Financial aid totaling $55 million increased approximately 7%, resulting in an undergraduate tuition discount rate of 36%, an increase from 35% in FY 2011/12
- A total of $308 million toward the campaign’s overall goal of $400 million
An additional tidbit from Ron Medley ’73 on an alumni listserv:
The official figure [of the endowment] is $689 million, up from $616 million in FY12. But, apparently, that does not take into account approximately $72 million in cash and money market investments that just happened to be lying around due to “the timing of year end cash flows.” [p.3] Now, that may just be accountant-speak for “already been spent,” but in my house, if I find money under the couch – that’s part of _my_ endowment. Either way, it is fun to contemplate the possibility that if you add the university’s “loose change” to what is technically the endowment, the figure could be as high as $760,000,000.
Chart on annual cash gifts:
So what does this endowment increase mean for things like need-blind admissions and other university operations? Last year, the relatively small endowment was cited as partially responsible for the University’s need-blind policy change. Chief Investment Officer Anne Martin indicated that “one reason that some schools can afford to be need-blind is because they have a big endowment, and therefore the endowment can supply more of the operating budget, which includes financial aid.” Additionally, when the endowment is small, the Investment Office draws less from it to help with operational costs so that positive returns can be ensured for the University.
Since there was less money in the operating budget last year, according to Martin, the University was forced to make cuts to all “non-essential budget allocations.” The fact that there was nothing left to cut without damaging the quality of the education partially informed the administration’s decision to end its need-blind policy. Now that Wesleyan has made some progress in growing the endowment, it is unclear if we are back on the path toward need-blind financial aid. Realistically, it’ll probably take some more time, and we’ll probably need more money both in the operational budget and in the endowment. On the plus side, we can start to have more leeway on the things that are deemed non-essential budget allocations.
Thoughts? Concerns? Any economists reading this who want to solve our problems?
Wesleying: The Wrath Update
President Roth, I Expect Your Efforts Redoubled
Open Forum on the Endowment [Liveblog]
Need Blind Wes: Updates and Organization
Trustee Occupation Aftermath
Need Blind Activists Storm Football Game
Argus: The Endowment Faces Major Challenges
University Endowment Increases by $4 Mil in First Part of 2012 Fiscal Year
Wesleyan 2020 Blog: Wesleyan’s Endowment
MRoth Blog: Wesleyan Fundraising Campaign: This is Why
Wesleyan Endowment FAQ