Donations to colleges and universities rose solidly last year, to a record of nearly $30 billion, with the wealthiest universities again attracting a hugely disproportionate share, a new survey shows. But the economic downturn means the fundraising pace for 2008 could slow.
Private donations to higher education rose 6.3 percent last year to $29.75 billion, according to the annual Voluntary Support of Education survey, to be released Wednesday by the Council for Aid to Education.
The survey tracks donations by fiscal year, so the report for 2007 essentially covers the 2006-2007 school year and doesn't reflect the economic slowdown that began last fall.
The already wealthy schools — with leading faculty researchers and the most sophisticated fundraising operations — had the most success attracting new donations. The top 20 fundraisers raised $518 million more than the previous year, and a total of $7.66 billion. They account for just 2 percent of survey respondents, but accounted for more than a quarter of all contributions to colleges and universities, and nearly one-third of the total increase in giving.
Stanford University raised $832.4 million, the most of any institution, though its total was down from the $911 million it raised in the previous year — the largest one-year haul ever for a university. Next was Harvard with $614 million, which has the largest total endowment, followed by the University of Southern California with $469.7 million and Johns Hopkins' $430.5 million.
Next year's survey could mark the end of an extraordinary run for higher education that has let at least 76 institutions build endowments of $1 billion or more, according to the most recent figures from the National Association of College and University Business Officers.
Stagnant growth
During the last economic slowdown, in fiscal 2002 and 2003, fundraising growth was stagnant for two straight years.
"Anything to do with the economy, when people don't feel good, whether it's justified or not, it doesn't put them in a philanthropic mind-set as easily, there's no question about it," said Paul Robell, vice president for development and alumni affairs at the University of Florida. "It's just really a state of mind more than anything else."
Historically, economic conditions do affect giving to colleges, but not necessarily dramatically, said Ann Kaplan, who directs the survey.
"It tends to be fairly stable once someone has a habit of giving to a college or university," she said. "It's a fairly reliable connection people make to an institution they attended or some of the other institutions."
Florida raised $182 million last year, up from $161 million in 2006. A one-month record of $47 million came in during December alone.
"The biggest predictor of fundraising success is generally the stock market — if stocks are doing well fundraising does well," Robell said. But "we try to point out to people even if the market's down, most of their holdings are still vastly appreciated." Because of tax deductions, "it's still a good deal to make a gift with appreciated securities," he said.
Highest share of giving
The figures come as colleges have faced increasing demands from the public and in Congress to spend more of their endowments, particularly to keep tuition rises in check. In recent months a string of institutions such as Harvard, Dartmouth and Swarthmore have announced significant expansions of financial aid.
The changes vary from school to school, but have generally involved giving out more grant money so low-income students can graduate with little or no debt, and expanding at least some need-based aid to higher-income families — in some cases those earning well into six figures.
Foundations accounted for the highest share of giving — 28.6 percent, edging slightly ahead of alumni.
Donations from alumni fell slightly from last year but remain almost 17 percent higher than in 2005. The percentage of alumni who donate also fell slightly, to 11.7 percent on average.