Three years ago, Congress asked 56 schools to provide more information on their endowments. Duke responded.
Like many educational, cultural and health care institutions, Duke relies on an endowment to provide a permanent source of financial support for a wide range of activities, including student financial aid, faculty scholarship, programs and facilities. Income from this endowment, which is built on more than 90 years of contributions from donors, as well as the appreciation in value from their philanthropy, makes it possible for Duke to provide the highest educational experience for students from all socioeconomic backgrounds.
Does the school reject a gift?
Rejected because purpose of gift not a priority for Duke. Certain gifts may propose support for one of the core purposes of Duke; however, if the proposed gift would support a program or effort that is not a priority for the academic leadership of Duke, then the donor would be asked to change the proposed restriction to better fit Duke’s academic plans. If the donor refuses, then the proposed gift would be declined. For example, a donor may propose an endowment gift to support a new research program that would not fit into either the current or proposed academic structure of Duke.
Rejected because of attempted donor control. In some instances, donors propose a gift that would normally be accepted by the university, except that the donors impose restrictions that would give the donors control over certain aspects of the gift and its expenditure. Preservation of the academic integrity of Duke requires that a donor retain no control over the gift and its use once the gift is made. That is, the restrictions on the purpose of the gift are carefully reviewed as noted above, and further, any attempted post-gift restrictions on the use of the gift are also carefully reviewed.
For example, in one case, a multi-million dollar gift was proposed to establish an institute including endowed professorships at Duke in a certain academic discipline, and the proposed academic discipline was acceptable to the university. At the same time, the donor proposed that the donor (and others to be appointed by the donor) would have a role on a committee that would review proposed faculty members for the proposed institute. The university determined that any role of the donor in the review of faculty members was unacceptable and the gift was therefore declined.
In another case, a donor proposed a multi-million dollar gift to endow a scholarship fund for students in one of Duke’s schools. The purpose of the fund was acceptable; however, the donor insisted that the committee that selected the scholarship recipients would include the donor. This proposed control by the donor over the use of the gift by selecting scholarship recipients was determined to be unacceptable and the gift was declined.
Can you spend more from the endowment?
Much like other universities, a large proportion of Duke’s endowment is tied to specific purposes as appropriated by individual donors. Duke’s response indicates that about $5.1 billion, or 69 percent, of the endowment is restricted by the terms of the donor’s gift to the University.
“You can only spend your endowment on what people designate you to spend it on,” [Michael Schoenfeld, vice president for public affairs and government relations] said. “If somebody is giving you endowment for a professorship or the upkeep of a collection in the library, you can’t just decide that you’re going to spend that on financial aid—that’s against the law.”
Post by Marcelino Pantoja