Collegiate Times

Charitable contributions to colleges and universities across the country continued to climb in 2006, increasing by 9.4 percent from the previous year. Over $28 billion was donated to colleges and universities last year, despite the continuing drop in the percentage of alumni that contribute.

This drop in number of donating alumni was slight, at less than one percent, but it has been falling slowly for several years. Surprisingly, as fewer alumni donate to their alma maters, the amount that they give is increasing, rising to 18 percent in 2006.

 “The most benign reason for the drop in alumni participation is that new technology allows more and more alumni to be reached,” said Ann Kaplan of the council for aid to education.

Kaplan also suggested that the types of gifts colleges and universities are looking for has affected participation.

“Universities do not want to neglect small gifts, but putting a great deal of effort into five or ten dollars is not very beneficial,” Kaplan said. “They are more focused on the large gifts coming from a smaller group of people.”

In 2006, a staggering 88 percent of all private gifts came from just 80 individual donors.

Alumni are still the greatest contributors, accounting for almost one third of the total gifts received. Their donations make up a little over half of all charitable contributions to higher education institutions. Other contributions come from foundations ($7.1 billion), corporations ($4.6 billion), other organizations ($1.83 billion), and religious organizations ($380 million).

One reason for the dramatic increase in contributions across the country in 2006 is major fundraising campaigns held by some of the wealthiest colleges and universities.

Another reason for the dramatic upswing in giving to higher education is the state of the economy in 2006. From July 1, 2005 (the beginning of the 2006 academic fiscal year) until the end of December, major stock indexes enjoyed double-digit increases, prompting increased giving during that time. During the second half of the academic fiscal year, the markets did not fare as well, possibly affecting year-end giving.

“I am not surprised (at the increase),” Kaplan said. “The economy was strong during the period that we were surveying, so when individuals were asked to contribute, they were in a position to give generously. When we are not in a recession and tax laws have not changed, giving generally goes up.”

Virginia Tech achieved its second-highest fundraising total ever in 2006, raising $75.3 million. This total was second only to the previous year, in which Tech experienced a 14 percent increase in gifts. The alumni participation at Tech is at 21 percent, well above the national average of 11.8 percent.

“We are about to start our next capital campaign, which we will go public with in April. Our goal is to raise $800 million in pledges and commitments,” said Thim Corvin, associate vice president for development at Virginia Tech. “We would like to increase our endowment from 450 million to one billion dollars. The endowment funds scholarships, graduate assistantships, libraries, campus preservation, and other important things at Virginia Tech.”

All gifts donated to Virginia Tech go through the Virginia Tech Foundation before being spent. However, the foundation does not decide how to spend the vast majority of gifts.

“When people make a gift, 99 percent of the time, the gift is designated by the donor. Scholarships are a very popular choice, as are endowed professorships and athletics,” said Virginia Tech Foundation chief operating officer, Ray Smoot.