May 3, 2001 | Read Time: 3 minutes
By JANET L. FIX
Donations to colleges and universities rose 13.7 percent in fiscal 2000,
the fifth double-digit increase in as many years, and gifts to private elementary and secondary schools also rose substantially, according to a new survey.
But college fund raisers are predicting a decline in giving this year because of volatility in stock prices, a growing number of corporate layoffs, and an overall slowdown in the economy.
The survey, which was conducted by the Council for Aid to Education, in New York, found that private donations to colleges and universities totaled an estimated $23.2-billion in the fiscal year that ended June 30, 2000, an increase of $2.8-billion over fiscal 1999.
Among 225 private elementary and secondary schools that participated in the council’s surveys in 1999 and 2000, donations rose 28 percent.
The growth in total donations to higher education outpaced the 10.9-percent growth in 1999, according to Ann Kaplan, director of the survey. But last year’s increase was lower than in 1998, when giving grew by 15 percent to $18.4-billion.
Alumni gave 29 percent of the total in fiscal 2000, or $6.8-billion, an increase of 14.7 percent from 1999. Donors other than alumni gave 23 percent of the total, or $5.4-billion, up 12.7 percent; corporations gave 18 percent, or $4.1-billion, up 15 percent; and foundations contributed 22 percent, or $5.1-billion, up 12 percent. Other organizations contributed the remaining 8 percent of the total.
Giving to higher education has grown by an average of 9.1 percent annually over the past 30 years, Ms. Kaplan said. That figure not only mirrors how stocks have performed over the long term, but it also could portend a decline in the rate of growth in donations in coming months, experts say.
“The law of averages suggests that giving would slow in the next few years,” says Patrick Rooney, director of research at the Center on Philanthropy at Indiana University, in Indianapolis. “Historically, there is almost always one to two years of below-average growth after several years of higher-than-average growth.”
Technology Donors
Some institutions completed big capital campaigns before the worst of the recent market decline. By June 30 last year, the Kinkaid School, in Houston, a day school serving 1,300 students in preschool to grade 12, had raised $24-million of the $35-million it needed to construct three buildings. The school surpassed its goal by early December, before a sell-off that caused the Standard & Poor’s 500 Index to tumble in the first quarter of this year by 12 percent.
But many donors, especially those who made their fortunes in technology, are being pinched by the market decline, and fund raisers predict that eventually their institutions will feel the pinch too.
Stanford University, which ranked No. 1 in the survey for donations to colleges and universities, so far has not seen gifts slow from last year, when donations totaled a record $580-million. But if the market volatility continues, Stanford could see its gifts, especially from Silicon Valley donors, slow in the second half of the year, says John Ford, vice president of development.
“I don’t want to come across as bearish, but I’ve been doing this way too long not to be realistic about the effect that an up-and-down market has on philanthropy,” he says. “A handful of donors may want more time to fill their commitments.”
Phillips Exeter Academy in Exeter, N.H., received $36-million in donations in 2000, ranking No. 1 among boarding schools. But Jim Theisen, the school’s director of alumni affairs and development, said the market downturn has already decreased the number of gifts paid with stock this fiscal year, although the dollar value of gifts received has not fallen.
“We’ve already seen 33 percent fewer donors give stock gifts this year,” he said. “If an institution traditionally has a lot of stock gifts, it may not do as well” as in recent years.
The complete report, “Voluntary Support of Education 2000,” will be available in June from the Council for Aid to Education, 342 Madison Avenue, Suite 1532, New York, N.Y. 10173; (212) 661-5800. The cost is $65 for institutions that participated in the survey and $100 for others. More information on the survey is available on the council’s Web site at http://www.cae.org.
