Lackluster year for college endowments

2013-02-06T00:15:00Z 2013-02-06T09:36:09Z Lackluster year for college endowmentsBy Tim Barker tbarker@post-dispatch.com 314-340-8350 stltoday.com

After growing nearly 20 percent the previous year, the nation’s colleges had a rather lackluster year on the endowment front in 2012.

The endowments of 831 U.S. colleges and universities suffered a slight decline in value — down 0.3 percent — during the 2012 fiscal year, according to an annual survey by the National Association of College and University Business Officers and the Commonfund Institute.

The stagnant growth, which takes into account investment returns, spending and new gifts, was not unexpected. When last year’s report was released, the authors predicted a downturn was likely, based on the struggling stock market.

While most of the larger local foundations suffered losses, there were a couple of bright spots.

The University of Missouri system reported a 4.7 percent increase, with its endowment growing to $1.17 billion.

Nikki Krawitz, the system’s vice president of finance, said the performance was boosted by the Columbia campus’ decision to sell its Research Animal Diagnostic Laboratory.

The unit, founded in 1968, provides services to companies that use animals in their research. Maine-based IDEXX Laboratories paid $43 million for the lab, which is staying in Columbia.

That money is now being used to support Mizzou’s College of Veterinary Medicine.

Krawitz said the system is looking at a stronger 2013, with significant gifts earmarked for Mizzou’s journalism program and its athletic department.

“If the market keeps going the way it is, it should be a good year,” Krawitz said.

The University of Illinois Foundation was in the closing months of its eight-year Brilliant Futures campaign, which brought in $2.43 billion in donations and pledges. Some of that money helped push the university’s foundation to $1.67 billion, a 4.2 percent increase over 2011.

Spokesman Don Kojich said 2012 marked the fifth consecutive year in which the foundation brought in more than $200 million in cash gifts: “It was a very strong year for us.”

And as with the UM system, 2013 is showing considerable promise. Just last week, the foundation announced a $100 million gift from the Grainger Foundation for the engineering college on the Urbana-Champaign campus.

These endowments often represent a significant source of money for schools, which use them for everything from scholarships to professorships to new academic buildings. Schools in the endowment survey said they get an average of 8.7 percent of their operating budgets from their endowments.

Among other local schools:

Washington University, with the nation’s 17th largest endowment, lost 1 percent of its value, falling to $5.23 billion; St. Louis University fell 3.1 percent to $853 million; the Principia Corporation dropped 12.7 percent to $593 million; and the Southern Illinois University Foundation fell 3.6 percent to $93 million.

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