College endowments drop 6.1% in R.I. in 2012 fiscal year

ENDOWMENTS TO RHODE ISLAND'S colleges and universities fell 6.4 percent during the 2012 fiscal year. (Click on image to see larger size).
Posted 2/12/13

(Updated Feb. 28, 4 p.m.)

NEW YORK – Educational endowments to colleges and universities in the Ocean State dropped 6.1 percent in the 2012 fiscal year, according to a report from the NACUBO-Commonfund Study of Endowments produced by the National Association of College and University Business Officers and figures from Providence College.

The report, released in early February, found that the endowments of the 831 institutions surveyed had an average decline of 0.3 percent in the fiscal year ended June 30, 2012, a stark comparison to the average national gain of 19.2 percent from 2010 to 2011. (The gain or loss of the endowments included changes due to withdrawals to fund operations or capital expenses, payment of management fees, donor gifts or other contributions, and investment gains or losses.)

Of the seven Rhode Island four-year colleges in the report, only Salve Regina University saw a gain in the value of its endowment during the 2012 fiscal year, with a rise of 1.6 percent over the year to $44.4 million, ranking it the 591st-largest endowment in the nation.

Providence College, which wasn’t included in the report, said it saw its endowment increase 0.75 percent to $165.9 million in the fiscal year ended June 30, from $164.7 during the fiscal year 2011.

Brown University’s endowment, the state’s largest, saw its value dip 1.1 percent during the fiscal year to $2.46 billion.

Even with the 1.1 percent decline, Brown ranked in the top 25 nationally for the size of its endowment. Harvard University and Yale University topped the national list with $30.44 billion and $19.34 billion in endowments, respectively.

The Rhode Island School of Design has the next largest endowment in Rhode Island, which stood at $297.2 million at the end of the fiscal year, a 6.7 year-over-year decline from the end of June 2011. RISD ranked No. 217 out of 831 nationally.

Johnson & Wales University, which ranked No. 236 nationally, saw a 2.5 percent decline in value to $240.3 million during the fiscal year.

Bryant University has the state’s fourth biggest endowment and ranked No. 331 nationally. The Smithfield-based university lost 4.6 percent year over year, leaving its endowment at $141.8 million at the end of the fiscal year.

The University of Rhode Island, which ranked No. 414 nationally, saw endowment drop slightly (0.1 percent) in the fiscal year to $93.6 million.

The Rhode Island College Foundation saw its endowment slip 0.9 percent during the fiscal year. Ranking No. 720 nationally, the college stood at $20.8 million at the end of the fiscal year.

Overall, the value of Rhode Island’s college and university endowments covered in the report stood at $3.3 billion by the end of the year, a 6.4 percent decline from the $3.5 billion value at the end of June 2011.

Including Providence College, which was not included in the report, Rhode Island’s colleges and university endowments stood at $3.46 billion at the end of the year, a 6.1 percent decline from the $3.69 billion at the end of the 2011 fiscal year.

In Bristol County, Mass., Wheaton College and Stonehill College saw endowment drops of 3.3 percent and 3 percent to $159.5 million and $146.7 million, respectively (The two schools ranked No. 307 and 329, respectively).

The University of Massachusetts Foundation Inc., which funds all of the University of Massachusetts campuses, including UMass Dartmouth, saw its endowment rise 6.8 percent during the fiscal year to $565.1 million, No. 134 on the list.

In an article about the report, U.S. News and World Report said the decline in endowments could affect its “Best College Rankings” list.

Although U.S. News said endowments were not direct factors in their rankings, a decline in a college’s endowment can “have a negative impact on the school’s ability to fund its yearly operating budget, since institutions use income from their endowment to supplement tuition from students and other sources as a way to fund ongoing operations.”

The article added that as endowments shrink, colleges and universities may have less money to spend per-student to a ensure quality education.

To view the full NACUBO report, visit: www.nacubo.org.

The story was updated to include figures from Providence College.

This story was updated on Feb. 28 to reflect revised figures from Brown University. A representative from Brown said: "Due to a change in the survey methodology by which [NACUBO] gathers information about invested assets, Brown University incorrectly reported data for fiscal year 2012.... The correct figure is change in value over the prior year is -1.1 rather than the -7.3 reported."

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