MIT plans endowment driveBy Jim Brody
MIT is planning a campaign to raise $600 million to $1 billion to increase its endowment, according to Vice President for Financial Operations James J. Culliton.
The effort, which will be formally announced within a year, will work to bolster the Institute's endowment. MIT's endowment is currently seventh in size, 19th in amount per student and 33rd in amount per faculty member in the country, stated a Sept. 11 memorandum addressed to department heads, center and laboratory directors and administrative officers from Culliton and Director of Finance John A. Currie '57.
New endowment funds will be raised from both corporations and individuals, according to Director of Resource Development Ned Lees '53. Endowment grants are usually more difficult to solicit than research monies because research funds usually show immediate results, he added.
Several members of the MIT Corporation will be involved in the drive; they should be able to provide key contacts in industry, according to Culliton. Much of the funds raised are expected to come from industry, he said.
The Corporation Development Committee, President Paul E. Gray '54, deans and other senior officers are working on identifying priorities for the drive. Culliton said an increase in the endowment is needed because revenue from research and tuition has peaked.
Investments of the endowment return 13 percent. Endowment earnings are rolled back into the endowment to compensate for inflation. Six percent of the total endowment is used annually.
Sponsored research accounted for over two-thirds of operating revenues last year, according to Culliton's and Currie's memorandum. Although endowment income has expanded over the past few years, the increase in operating expenses has greatly exceeded the growth in revenue, they wrote.
The Alumni Office has only 65,000 addresses of the 81,000 living alumni, said Alumni Fund Director J. S. Collins. Over $10 million, much of which was designated unrestricted, was raised last year for the Alumni Fund.
Unrestricted funds are sometimes used for operating expenses or student financial aid, he explained. Ideally they are earmarked for the endowment, Collins added.
Student aid will receive special emphasis in the drive, according to Lees. This could possibly lead to an increase in the number of endowed scholarships because many undergraduate scholarships are now financed through unrestricted funds, he said.
The campaign will require extra effort from faculty, staff, Corporation members and other volunteers, Culliton wrote in his memorandum. Collins said, "The Alumni Fund will enthusiastically do its share."