Giving to Private Colleges Dropped Last Year, Survey Finds

With a battered economy and volatile financial markets taking a toll on donors’ pocketbooks, private giving to American colleges dropped sharply in 2009, according to findings of the annual Voluntary Support of Education survey, released last week.

Donations were down by 11.9 percent, to $3.75-billion from the previous year—the steepest decline in the survey’s 50-year history. (Adjusted for inflation, the drop was 11.5 percent.)

Colleges brought in an estimated $27.85-billion in gifts in the 2009 fiscal year, according to the survey, which included 1,027 institutions and was conducted by the Council for Aid to Education.

The year before, colleges raised $31.6-billion, which was the highest total ever reported in the survey. In 2009 alumni participation dropped to a record low, and the size of the average alumni gift was down, too.

The survey’s findings were grim but not unexpected.

During the period of the survey—July 1, 2008, to June 30, 2009—college fund raisers had reported “hitting a wall” with donors who had either lost significant portions of wealth or were nervous that they would.

“The economy was so bad, the only thing that would have been a surprise is if it had been a really good year,” said Ann E. Kaplan, the survey’s director.

Given the economy’s troubles, Ms. Kaplan said, the drop could have been worse. “Where people could continue to make gifts, they did.”

Almost no institution was immune from the downturn’s negative effects. The 20 universities that raised the most money—$7.28 billion, which represents 26.2 percent of all gifts to higher education—saw a decline of 11.8 percent from the year before.

“Nobody is unscathed,” said Robert F. Sharpe Jr., a Memphis fund-raising consultant. “Everybody is affected in some degree or another.”

Some institutions were less hurt than others, Mr. Sharpe said. Those that had stables of committed longtime donors did better than those with more new donors. Also, the recovery varies by region. Institutions whose support is concentrated in harder-hit areas of the country are faring worse.

“It’s not like you had a tide come in and everybody’s rising and falling evenly,” Mr. Sharpe said. “It’s complicated.”

Less Participation

The survey found that the proportion of alumni of record who gave continued to decline in 2009, falling 1 percentage point to 10 percent, the lowest level recorded. The steady drop in alumni participation is troubling for colleges, because alumni are their largest source of contributions, making up a quarter of total giving.

In recent years, the total amount of alumni giving had been rising, despite the decline in the participation rate. But last year that total fell significantly, down 18 percent from the year before, the survey found. In 2009 alumni gave $7.1-billion, compared with $8.7-billion in 2008. The average alumni gift shrank by 13.8 percent.

The full survey report can be ordered through the Council for Aid to Education’s Web site, http://www.cae.org.

Tables showing the survey’s key results can be found on The Chronicle’s Web site. Go to: http://philanthropy.com/extras.