Giving to Colleges, Private Schools Drops for Second Year in a Row

For the second consecutive year, private donations to colleges, universities, and secondary schools declined, according to new figures from the Council for Aid to Education.

Donations to colleges and

universities fell 2.2 percent, after adjusting for inflation of 1.9 percent, according to the council, a research group in New York that is a subsidiary of the RAND Corporation.

Giving to the 954 institutions surveyed totaled $23.9-billion for the fiscal year ending June 30, 2003. The decline in gifts to higher education occurred for just the second time in 16 years, the council said.

Gifts to private secondary schools in fiscal 2003 declined 3.4 percent after adjusting for inflation, to $914-million, according to a separate study by the council.

At colleges, gifts from people who were not alumni of the institution dropped last year by $850-million, or 15.7 percent, the largest decline in three decades, the council said. Such donations accounted for $4.6-billion, or 19 percent, of private support to colleges and universities last year.

While the value of gifts from alumni of colleges and universities increased 9.4 percent, to $6.6-billion, fewer people gave money to their alma maters last year than in fiscal 2002, according to a report on the survey.

Gifts of appreciated stock, which usually account for a large share of the donations that educational institutions receive, continued a precipitous decline in number and value last year, the report said. Despite a rise in the stock market from July 2002 to July 2003, the value of gifts of appreciated stock fell by 21.2 percent in fiscal 2003, after declining 35 percent the previous year.

The large profits that many companies earned in 2003 did not induce them to increase their contributions, as corporate support of higher education declined by 2.7 percent, to $4.3-billion, the report said.

In addition, foundation grant making to colleges continued a two-year slowdown. Grants from foundations rose just 2.4 percent last year, following a 4.8-percent rise in fiscal 2002. In the six years before fiscal 2002, grants from foundations had increased by at least 10 percent annually, according to the survey’s director, Ann E. Kaplan.

However, for the second consecutive year — and for just the second time in 26 years — foundations gave as much to higher education as alumni did.

While private donations for the operating costs at colleges increased by 4 percent last year, support for capital projects declined for both higher education and secondary schools, according to Ms. Kaplan. At colleges, alumni gave 4.3 percent less money in 2003 toward capital projects, such as new buildings or endowments.

The majority of private donations to secondary schools are dedicated to capital purposes, Ms. Kaplan said. But last year, 181 private secondary schools in the survey said their gifts for capital purposes dropped by 7.4 percent.

Harvard Tops the List

Harvard University, which raised $555.6-million in fiscal 2003, collected more than any other college or university. Stanford University finished second, with $486-million in contributions, while the University of Pennsylvania came in third, bringing in $399.6-million.

The University of Arkansas, at No. 4, attracted the largest single award in 2003 — a $300-million grant from the Walton Family Charitable Support Foundation, which was started by Sam M. Walton, the founder of Wal-Mart.

A summary of the survey results is available on the council’s Web site, http://www.cae.org. A full report based on the data will be available in May. Copies will cost $65 for institutions that participated in the survey and $100 for others, and may be found on the group’s Web site or obtained at the Council for Aid to Education, 215 Lexington Avenue, 21st Floor, New York, N.Y. 10016; (212) 661-5800; vse@cae.org.