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Endowment Report May 2014

The Endowment by the Numbers

1,073 793

17

$110m

Endowed Funds

Endowed Chairs or Professorships

Market Value

Endowed Scholarship Funds


uri foundation endowment Overview This report has been prepared to provide our endowment stewards, many of whom are also endowment donors, and others, with performance and investment related information

29% Alumni

about the University’s overall endowment

45%

Corporations/ Foundations

portfolio. The University endowment is made up

16%

of a pool of over 1,000 individual endowment funds, each established through the generosity of donors, including URI alumni and friends. Each fund has been established with a donor-specified purpose, and each has been prudently invested in order to preserve its principal value over time,

10%

Other

Friends

Sources of Support

while generating earnings that are being used to make a meaningful impact at URI for this and future generations of students.

Supporting URI and the Endowment The URI Foundation, on behalf of the University

The portion of funds distributed from the

of Rhode Island, secures and encourages

investment of the entire pool of endowed funds

endowment gifts from alumni, corporations and

— or the General Endowment Fund (GEF) —

foundations, friends and other supporters of the

and contributed to the University each year is

University as a means of ensuring that a legacy of

a very important piece of the overall impact of

support for URI students, faculty and programs

charitable giving at URI. Last year (fy 2013), a

will continue and grow in perpetuity.

combined $11 mil­lion in direct expendable gifts and distributed endowment earnings

Endowment Support

was made available to support the students,

34% Endowment Support 66% Direct/Expendable Gifts

faculty and programs of the University of Rhode Island. Additional gifts totaling ap­ proximately $4.3 million were made to provide further support to the endowment. As a valued contributor to and/or steward of an endowment fund at the University of Rhode Island, you are helping to support the University’s

More than 11,000 donors made gifts to the University of Rhode Island during fy 2013. Approximately 34 percent of those gifts were directed to provide endowment support.

mission, goals and successes. As a partner in our

Endowment gifts are differentiated from

progress, we are pleased to share with you, this

immediately expendable gifts, as they become

detailed performance report on the GEF.

long-term investments which, through the


stewardship report may 2014 earnings they generate, provide financial stability

If the principal value of the General Endowment

and consistent support over time and allow the

Fund (GEF) grows at or above the rate of inflation,

University to be less dependent on other sources of

an increasing stream of income will be generated

revenue, including state appropriations. The level

to meet the rising costs of education, to support

of state support to URI last year was 8 percent.

faculty and programs and to provide opportunities to our students, both undergraduate and graduate. Currently, 75 percent of all URI undergraduates receive some form of financial aid.

Students receiving financial aid: 75%

State Support

1999:

23%

2007:

17%

2013:

08%

The primary objective of the endowment is to support the long-term needs of the University by maintaining a strong and healthy endowment and by growing the inflation-adjusted value of the assets over time by investing a portion of the endowment’s earning and appreciation back

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into the fund each year. This principal growth is intended to help offset the negative implications of rising inflation and dips in the business cycle over time.

Investment Performance The GEF’s performance is calculated on a total return basis, which, for pur­poses of this report, represents the combination of income,

Endowment Gifts to URI by Purpose

53% Scholarships 04% Building and Equipment 09% Chairs and Professorships 26% Academic and Program Support 08% Other

dividends, and gains and losses for the time period reported, net of investment management fees and distributions made from the GEF. The value of the GEF, which includes all individual endowed funds, was $110 million as of December 31, 2013. The annualized return on the portfolio, as of December 31, 2013, was 13.1 percent.


Annual Distribution of Earnings

$4.0

The payout from the investment of the GEF to the University varies each year, based on both

$3.0

endowment value and the spending policy, adopted by the URI Foundation Executive Board,

$2.0

3.4

3.0 2.5

2.7

2.9

2013

2014

for that given year. For use in the upcoming academic year, 2014/2015, $3.4 million will be distributed to support donor specified purposes. The payouts distrib­uted for use for the upcoming and previous four academic years are as shown at right. Note: for new funds, the first award for endowed scholarships is available the first

$1.0

$0 2011

2012

2015

Annual Endowment Distribution

occurring fall semester 12 months from the date

in millions

of fulfilling the minimum fund value.

Uri Foundation Spending Policy

Conclusion

The FY 2015 spending rate is 4.7 percent — recently

The benefits of endowment gifts are felt far and

raised from 4.5 percent. This rate contains both

wide across the campus, with every dollar helping

the University distribution and the Foundation’s

to support the things that distinguish URI from

manage­ment fee. For the upcoming fiscal year,

its peers: its students, faculty and programs. The

the distribution to the University will equal

investments help shape URI’s character and its

3.4 percent of the rolling prior twelve quarter

future, while contributing to its competitiveness on

average market value on the designated calculation

the local, state, national and international levels.

date (December 31), up from 3.1 percent last fiscal

The generosity of the University of Rhode Island’s

year. The management fee has been set at 1.3

many endowment donors is deeply appreciated.

percent, which was lowered from last year’s 1.4

On behalf of the entire University community,

percent rate, as the Executive Board moves toward

including the students who benefit directly from

a more donor-centric and impact-minded balance

endowed scholarships, we extend to those donors,

in the breakdown of the overall spending rate.

our heartfelt and most sincere thanks.

For more information about the management and oversight of the URI endowment, as well as asset allocation, portfolio composition and payout calculation specifics, please visit www.urifoundation/ investmentperformance. The goal of this report is to provide you with meaningful financial information. In doing so, we realize that some questions may arise. If so, please feel free to contact Merelise Hitte, the URI Foundation’s director of finance, by calling (401) 874-4490 or by emailing mhitte@foundation.uri.edu.

uri foundation 79 Upper College Road, Kingston, Rhode Island 02881 (401) 874-7900 | foundation@uri.edu | urifoundation.org As is customary with many universities across the country, a one-time gift fee is deducted from all donations to provide essential support to uri’s overall development activities.

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URIF Endowment Report, May 2014