The Red and Black

Issue date: 4/2/09 Section: News

MACE

Funds that help recruit and retain the University's most valuable scholars and teachers - endowments - are down 30 percent, but the University is faring just fine without $270 million of its private donations, an administrator said.

"For fiscal year 2009 we were able to fund all of the needs as far as scholarship commitments and endowment professor commitments, but we did so because we had a bit of a reserve," said Tom Landrum, senior vice president for external affairs.

As for fiscal year 2010, beginning July 1, he said, "What we'll see in the near-term is a very cautious belt-tightening approach to how we support those programs that are supported by endowments."

One of those programs experiencing some "belt-tightening" may be the University's premier scholarship program, the Foundation Fellowship, said Arnett Mace, senior vice president for academic affairs and Provost.

"We in fact may offer fewer [fellowships] in number or we may reduce some of the benefits that are provided or opportunities that are provided to Foundation Fellows," he said in a phone interview last week. "But a final decision has not been made on that."

The most recent high point for the University's total endowment was in fall 2007, when it was worth $705 million, Landrum said. One year later, the endowment has fallen to $437 million.

Mace said administrators "currently are doing an analysis on where we do have the shortfall and we know every endowment is down and support for our faculty who hold [endowed] chairs is down because of the stock market."

During the next couple of months, administrators will prioritize endowed projects to decide where funds should be directed, Landrum said. Taking top priority are endowed chairs and "key scholarships that are used to help recruit students," he said.

Endowed professorships and scholarships are critical to the University's competitive advantage next to peer institutions, Landrum said. So far, the University has retained competitive leverage because its endowment losses equal the national average, he said.

By definition, endowments are funds donated by individuals, corporations or foundations. Those funds, Mace said, "provide support for our GRA chairs - our Georgia Research Alliance chairs - our other chairs, the professorships and the various scholarships that are endowed at the University. So they provide for students and they provide support for faculty to conduct the programs for which they are responsible."

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