BULLISH ON BARD

On April 1, 2021, Bard College accepted a $500 million challenge grant from George Soros and the Open Society Foundations (OSF). “This is the most historic moment since the College’s founding in 1860,” said Bard College President Leon Botstein. “When this endowment drive is complete, Bard will have a $1 billion endowment, which will ensure its pioneering mission and its academic excellence for the future.”

This pledge to Bard’s unrestricted endowment is transformative for the College, and sends a powerful message that Bard’s forward-thinking and ambitious programs—in the arts and education in Annandale, in prisons, in high schools, across the United States, and around the world—are valued not just by those who have experienced them but also by those who recognize that access to a liberal arts education is a viable and necessary path to a free and open society.

The OSF grant ranks among the largest gifts to higher education in the United States in recent years. (Michael Bloomberg’s $1.8 billion donation in 2018 to Johns Hopkins University, which at the time already had an endowment of $3.8 billion, is believed to be the largest.) Soros’s pledge challenges Bard to raise an additional $500 million for its endowment over the next five years, and the College is well on its way. As of October, $330 million had been raised from trustees, alumni/ae, and friends—an impressive feat and a strong show of support.

Bard may be unique in its global reach and public-service mission, but it faces many of the same challenges as other private institutions of higher education. Among these are that the basic costs of providing an educational degree program have steadily risen at the same time as the college-age prospective student population has shrunk. This imbalance has resulted in increased competition with other institutions for tuition dollars from students who can afford the cost and an increasing need to provide financial aid to those who cannot.

Historically, Bard has had a comparatively minimal endowment, so it has had to be far more reliant on income from tuition and philanthropy to face crises and to grow selectively. In today’s environment, however, an endowment is a necessity for long-term institutional financial health.

Bardians are extremely well represented on the staffs and boards of nonprofits, but a few readers may be unfamiliar with their inner workings, so (at the risk of stating the obvious): An endowment is a pool of investment funds or financial assets created to provide a financial return to a nonprofit institution. By maintaining the investments over a long period of time, a portion of the returns provides a steady stream of cash income, called the endowment draw.

Trustees typically set spending controls to ensure that the endowment draw is consistent and does not exceed the returns on the endowment’s assets, which is what allows the college or university to maintain the income in perpetuity.

To oversimplify, if the operating budget of the College is like a checking account, the endowment is like a savings annuity, providing an income for operations on a regular basis. How much income the endowment provides depends on its size and on the draw, which at most nonprofits is set at between 4 and 5 percent of the endowment principal. Having this reliable source of income provides financial stability and also provides the institution with flexibility and independence. The consistency of the endowment draw allows the institution to maintain a stronger focus on the institution’s mission.

Over its more than a century and a half of life, the College has endured two world wars, 17 of the country’s 19 worst recessions, pandemics, and many other ups and downs. It has been brought back from the brink several times, because what Bard does matters. Set against that backdrop, a significantly increased Bard endowment will at last provide muchneeded security, minimizing the existential threats the institution has faced and steering the College further on a stable path to financial self-determination. Bard will be able to meet its existing budgets without having to sacrifice the quality of education it offers or the commitment to bring that education to populations that have historically been excluded. In sum, it allows Bard to remain Bard as we know and love it.

How can I participate in the endowment challenge?

Donors who want to help meet the endowment challenge can consider a planned gift or bequest. Doing so is a way to make a significant impact on Bard’s future. By including Bard in your estate plans, or designating Bard as a beneficiary of your retirement plan or other assets, you will help to provide financial security to the College and enable the continued expansion of access to a Bard education. Donors who disclose a planned commitment to Bard are recognized as members of the Margaret and John Bard Society.

What will the endowment fund?

For academic institutions, the income generated by endowment funds is intended to finance a portion of the operating or capital requirements of the institution. At Bard, the endowment draw will be used to help smooth out operating expenses and ease Bard’s reliance on other forms of income to cover basic costs.

Who will benefit from the endowment?

Bard’s network is vast, and the transformative challenge grant made by George Soros and the Open Society Foundations secures the endowment of the College and its programs, with the exception of Longy School of Music, Bard College at Simon’s Rock, and the Bard Graduate Center in New York City. Those three schools have their own endowments, and each is responsible for its own fundraising.

How does the endowment affect other fundraising efforts?

Growing the Bard endowment is a long-term strategy to strengthen the College. The pledges toward Bard’s endowment will provide much-needed financial stability, but they are not all available immediately. That is a big reason why even the wealthiest universities— Harvard, Yale, and Stanford—continue to raise funds every year for their annual operations. Annual giving is always critically important!