Bacon's Rebellion

Democracy Thrives in Sunlight

UVa Investments Top $10 Billion

—

by

James A. Bacon
in

The University of Virginia’s long-term investment pool has reached an all-time high of $9.6 billion, according to the University of Virginia Investment Management Company (UVIMCO). The university also maintains a $475 million short-term pool, invested in short-term Treasury bills and notes.

The long-term investment pool includes the UVa endowment, the Strategic Investment Fund and other long-term assets. In 2019, the pool generated an investment return of 5.8%, somewhat below it’s 7.9% benchmark. But over a 10-year period, UVIMCO has generated an 11.0% return compared to a 9.2% benchmark.

According to the Cavalier Daily student newspaper, UVa uses about 5% of the money returned on its investments for scholarships, fellowships and professorships, about $238 million in 2019.

While 80% of the endowment portion of the investment pool is restricted by the terms of the donors’ gifts, the balance is used “to meet emerging needs and highest strategic priorities.” Those priorities, as defined by the University’s current capital campaign, are funding scholarships, lectureships, research funds and book funds. States the report:

Most recently, the Foundation responded to the University’s need once again by helping to attract to UVA exceptional classroom teachers and innovative researchers through its Professorship Program. A series of $5 million endowed professorships has enabled the Foundation to underscore its commitment to attracting top talent by providing the University the resources it needs to hire outstanding faculty. In less than ten years, the Foundation has raised more than $55 million in support of its professorships—or eleven $5 million endowed funds.

In 2019, investments from the Strategic Investment Fund (SIF) have gone to the Biocomplexity Institute, the Memorial for Enslaved Laborers, and the Bicentennial Scholars Fund.

— JAB

Share this article

ADVERTISEMENT

(comments below)

ADVERTISEMENT

(comments below)

Comments

12 responses to “UVa Investments Top $10 Billion”

  1. djrippert Avatar
    djrippert

    Where is Elizabeth Warren when you need her. Sounds to me like this gigantic endowments ought to be eligible for a wealth tax too. 6% of $10b is $600m … per year.

  2. Lift Avatar
    Lift

    I don’t know how Jim Ryan kept a straight face as he launched the public phase of “Honor the Future” capital campaign with a goal of $5B. Complete with Tony Bennett performing at The Rotunda and fireworks. Groupthink, through and through.

    As world problems go, this falls far down the list, but it makes my blood boil, perhaps frustration that so few see this as a problem, and a fixable one, at that.

    1. Dick Hall-Sizemore Avatar
      Dick Hall-Sizemore

      Why is this such a problem? It is not as if the size of the investment pool is a secret. If the alumni want to give $5 billion for the capital fund, it is their money. The taxpayers should be glad that there are alumni willing to give this much; otherwise, many of the capital projects funded by donors might become tax-supported projects.

  3. LarrytheG Avatar
    LarrytheG

    Yep – agree. As long as UVA tuition is in line with other Colleges and Universities – why is there such resentment about this?

    UVA “envy” ?

  4. Lift Avatar
    Lift

    As is often the case with Jim Bacon’s thorough approach, there are now more pieces he’s posted tied to this same topic. As the “The Old ‘Percentage of Operating Budget’ Trick” piece shows, UVA hoards cash (I understand the difference betweeen fungible $ and donor gifts, but good stewardship entails guiding your support to critical need) while increasing, at gravity-defying rates, the cost to its students, and having the gall to ask taxpayers for more. State schools were never authorized to collect funds and redistribute as they see fit. How can it be OK to set aside $10B while increasing costs to students? And for perspective, if we estimate the cost @ $33,000 UVA could educate 30,303 students for every $1 billion it is sitting on. Maybe the incoming Democrats at the GA will decide free higher ed is now available at UVA.
    These institutions have lost sight of their mission and are accountable only to their peers and to US News & World Report. How much is enough? Should the capital campaign have a goal of $10B? Why? When UVA hired a Harvard dean I was sure the chase toward Ivy status would continue.

    1. James A. Bacon Avatar
      James A. Bacon

      “When UVA hired a Harvard dean I was sure the chase toward Ivy status would continue.”

      I hadn’t thought of it that way. But the Ivy League is Ryan’s frame of reference. If he came from Harvard, he will compare UVa to Harvard. Having internalized Harvard standards, it is only natural that he would apply them to UVa.

      1. Reed Fawell 3rd Avatar
        Reed Fawell 3rd

        Yes, Jim, that is right. The University of Virginia is not now, and does not in the future aspire to be, a public state university.

        UVA aspires to be a money and status making machine. Thus for example, it no longer sees its primary mission to be to preserve, enhance, and teach knowledge to students. It instead sees its primary mission to be to create and control altogether new knowledge and to monetize that knowledge for the benefit of the institution, and those senior people who run the institution.

        Hence status is all important to UVA, both institutional status, and the status of senior administrators and professors working there. And status is defined a money making rain makers, the equivalent of a national and international law firm, for example.

        Thus students are a commodity to be monetized at UVA as well. And thus too, the teaching of them is a low status position at UVA, as it is in most all elite universities which are by definition research universities, not teaching universities.

      2. Reed Fawell 3rd Avatar
        Reed Fawell 3rd

        Immediately above, I suggest that UVa. considers itself not a public state university, a label and mission it has expressly rejected, but instead is and aspires to be, in practical affect, a money making and status creating machine built for the benefit of those who run it (senior administrators and faculty) and their corporate and political allies who benefit from the New Knowledge that UVa claims to create, and the political and social influence that UVa now sells and claims to wield in the public arena nationally and now even worldwide.

        Earlier, here on Bacon’s Rebellion, we explained in a nutshell summary the structure Teresa Sullivan built at UVa. to achieve these twin goals of money making and status building for those who run UVa. Just below here is an elaborated version of that summary.

        “The answer is that the administrators, senior faculty, and their allies in private industry, who run UVA, are far more concerned about using UVA to enrich themselves, and to use UVA to increase their own status, than they are about teaching UVA students, especially its undergraduate students. Teaching undergraduate students they find far too demeaning and unprofitable for themselves as senior administrators and faculty, particularly since they now can successfully divert much of UVA’s undergraduate tuition and teaching to directly benefit only themselves, instead of using those funds and their time to benefit undergraduates and their families who pay the bills.

        We have explained this UVA strategy and its tactics time and again on this blog. It’s truth is beyond dispute. It has been plain to see since Rector Dragas in June, 2012 made public Teresa Sullivan’s Memo to her dated May 3th, 2012.

        This famous memo outlined Sullivan’s new vision for UVA’s future, one that Sullivan successfully implemented in all its major parts. Therein, back in early May, 2012 Sullivan made plain her then ongoing strategy and tactics to radically change UVA, and her intent as UVA’s president to relentlessly continue that strategy and tactics to fruition, namely:

        1. Focus most all her energies on driving up UVA’s ratings (defined by USNews & World R) to Number One in the nation)

        2. Accomplish item 1 above by doing away with most all undergraduate 1s and 2 year courses, particularly undergraduate foundational survey courses that were critical to the teaching of the humanities to undergraduates at UVA, and

        3. As item 2 was accomplished, Sullivan would replace these terminated undergraduate survey courses with STEM courses, and other advanced courses, that were taught to undergraduates by mostly graduate and post doc students, and adjunct professors, in lieu of tenure, and tenure track professors. And thus:

        4. As item 3 was accomplished, UVA would free up UVA’s tenured professors from teaching undergraduate students to almost exclusively doing their own research so as to keep those professors happy, and so as to give them the opportunity to make money for themselves and for UVA administrators, and UVA business allies, off of that research. And accordingly, UVA would built up a massive new infrastructure of hard assets (buildings, laboratories, ect), and soft assets (administrators, research assistants, business managers, and low wage low security contract teachers) to support and magnify the time, marketing, selling, and profits diverted to a few senior research faculty), creating for them exclusively profit and status creating modes of operation throughout UVA.

        All this of course would result in a massive explosion of costs to the university, so as to to enrich administrators and select faculty despite the exploding costs of these research programs that would paid by and spread onto others within and outside UVa, including most particularly the great majority of UVA’s undergraduates and their parents, Virginia taxpayers, and also UVA graduate students, and contract none tenured faculty.

        All this is made expressly clear in Sullivan’s May 3rd 2o12 memo to Dragas.

        Next we will talk about how this university structure guarantees “profits” to senior administrators, faculty, and their outside allies while shifting chronic losses onto everyone else footing the bills. And also how this structure generates junk research, junk knowledge, and junk education that poisons higher education, real knowledge, and our American society.

  5. Jane Twitmyer Avatar
    Jane Twitmyer

    Just looked up the Endowment status of the Ivy’s. The top 10 go from Harvard with almost $40B to Columbia with about $11. Looks like UVA will be right up there and I see that as a good thing for VA , and a way to keep costs down for capital projects and scholarship support, etc.
    AND as a UPenn grad, when we hired a Princeton dean to run Penn the first thing she talked about was building the endowment. Evidently she did as Penn is now number 6 on the monies list, a list that isn’t all Ivy but includes MIT, Notre Dame and others.

    1. Lift Avatar
      Lift

      Those are private institutions, free of the duty to serve the citizens of the state in which they operate. The push to privatize UVA and other top tier state schools is backward thinking, IMO. There is no shortage of elite, expensive schools with lots of endowment and lots of extras to offer students. What there is a dearth of is schools that provide a solid, excellent degree at a cost that is affordable (without aid or loans). I am uncomfortable putting $10B in the hands of university administrators to spend as they please. Current $ flowing in may come from from donors, but the foundation of the school is public funding.

      While UVA students have trouble succeeding in writing tests…

  6. Jane Twitmyer Avatar
    Jane Twitmyer

    First, the University of Michigan is on the top ten list of endowed universities. So is Texas A&M which I believe is also a public University. School with large endowments often are cheaper because some of the annual money annual interest is allotted to scholarships and professorships, plus other things that can decrease the annual student cost.

    Certainly some of the endowment gifts are restricted to specific things and certainly the endowment needs good oversight, but I think your fears are misplaced.

    Not sure what the last sentence means but if there is trouble academically it can be addressed and maybe fixing it would lead back to fixing something in the public schools that prepare Virginia students for UVA.

    1. Reed Fawell 3rd Avatar
      Reed Fawell 3rd

      Highly endowed schools are typically the most expensive by far for many, and irresponsibly so. These schools are also the most irresponsible by far in may other ways, in the minds of many. This includes how they accept, reject, levy students, and redistribute costs among students, and what they teach, preach, dictate, and brainwash into students, and what they fail to teach students, and the lies they teach to students, not to mention the bad examples they set, thus inculcate and breed harm and bad habits into their students, facts that are made plain most every day now.

Leave a Reply

Read More