ENDOWMENT REPORT 2014–15
Oklahoma City University
Thank You
Your investment in OCU changes lives Once again, the generosity of alumni and friends has taken Oklahoma City University to new heights. Your dedication to OCU is inspiring and deeply appreciated. We are sincerely grateful for all that you do. Key donations in the 2014-2015 fiscal year include the following: • Generous commitment from The Chickasaw Nation for the OCU Law School Campaign • Support for our Dawson-Loeffler Chemistry Laboratories renovation from the Inasmuch Foundation, the J.E. and L.E. Mabee Foundation, and leadership donors Herman and LaDonna Meinders • Testamentary gifts from the Charles Mehr Estate and the George Scott Family Trust
RICHARD PARRY Chair, Investment Committee
Every gift is important. Annual gifts provide support for the University’s greatest needs and newest opportunities. Major gifts help sustain excellence. Planned gifts have incredible legacy impact. And the beauty of all endowment gifts is that they are invested for the long term. We want to honor your dedication and trust by securing private support for OCU and through prudent investment and financial management. Our endowment growth continues, benefiting our faculty and students and advancing OCU toward a bright future. Rest assured that we will continue to steward endowment gifts with great care and that we target the OCU endowment to be exemplary in all respects. We greatly appreciate your commitment to the University. On behalf of the Investment Committee, the Resource Development Committee, and the entire Board of Trustees, we thank you for your generosity and extraordinary support.
GARY HOMSEY Chair, Resource Development Committee
Oklahoma City University listed among the best Western colleges —Princeton Review / 2016
Our generous and faithful donors continue to provide a significant margin of excellence for students and the faculty, staff and programs that support them. Their philanthropy makes a profound, positive impact and continues to help make Oklahoma City University the best educational institution possible. Many of our donors choose to direct their gifts toward endowment. OCU’s endowment, including endowment held by other entities for the benefit of OCU, is made up of 607 individual funds designated to provide perpetual financial support for scholarships, faculty professorships and chairs, the various schools, library resources, and other endowed programs. Of these funds, 522 are held by OCU, 67 by the Oklahoma United Methodist Foundation, and 18 by the Oklahoma City Community Foundation.
ENDOWMENT Endowment Assets by School/Department Clockwise from top of graph:
Alumni Association / 0.22%
Library / 0.56%
Arts & Sciences / 8.02%
Music / 14.77%
Athletics / 1.32%
Nursing / 1.19%
Business / 17.61%
Religion / 11.84%
Dance & Arts Management / 1.93%
St. Paul School of Theology / 0.73%
Financial Aid / 13.00%
Theatre / 0.99%
General University / 8.41%
University-Church Relations / 2.09%
Law / 13.16%
Other / 4.18%
Endowment Assets by Purpose
Academic Professorships & Chairs / 15.21% Scholarships / 56.12% Other / 28.66%
90% of students awarded academic merit, performance, or need-based aid
DR. SYBIL JONES Ties that Bind For Dr. Sybil Jones, supporting Oklahoma City University students through scholarships has always had deep, personal meaning. Her father, Paul Jones, developed a connection to the University through the Methodist Church in his hometown of Elk City, Oklahoma, and was impressed with the values OCU instilled in young students. During his last few weeks of life, Paul commented that he had wanted to set up a scholarship endowment at OCU, but he never had the chance to do it. He told Sybil he thought it would be nice to help a ministry student. After his death, Dr. Jones and her family established two endowments in her father’s memory: the Paul Jones Religious Education Endowed Scholarship and the Paul Jones Native American Endowed Scholarship. Throughout the years, Dr. Jones has received letters, built friendships, and stayed in contact with many of the scholarship recipients. “You always receive so much more than you can ever give,” Sybil said. “My association with OCU and the students has been a wonderful time in my life. Education is so important to young people, and I think Oklahoma City University is one of the best places to go to receive one.”
O
ur endowment has maintained strong
Assets and Distributions
financial growth as demonstrated by the
Assets Under Management
five-year average return of 8.92 percent
Distributions from Assets Under Management
entities for the benefit of OCU, was $94,912,972 as of June 30, 2015. This report highlights those funds directly managed by OCU trustees through the Oklahoma United Methodist Foundation.
Highlights & Trends New funds and market gains have grown the endowment over the past five years. Among the initiatives OCU endowment funds sustain are student scholarships and awards, professorships and chairs, capital projects, and other uses such as program support, special projects, equipment, books, and campus beautification.
65
3.0
60
2.8
55
2.6
50
2.4
45
2.2
40
2.0
35
2011
2012
2013
2014
2015
The historical returns presented herein represent the actual historical returns of the OCU Endowment which reflect the deduction of fees charged by third parties. Lipper Median returns are from the Lipper mutual fund universe for balanced funds in the asset class category. As of 7/14/15, the universe consisted of 4,953 peers. Source: Wilshire Associates and Lipper. The information in this document was obtained from sources believed to be reliable, however, accuracy is not guaranteed. Historical returns are not indicative of future performance.
OCU’s diversity reflects the world, with students from 47 states and 49 other countries.
1.8
MILLIONS OF DOLLARS
endowment funds, including endowment held by other
MILLIONS OF DOLLARS
on endowment investments. The market value of
MANAGEMENT & STRATEGIES Oklahoma City University is committed to prudent, time-tested investment strategies and fiscal policies. The Board of Trustees’ Investment Committee is charged with overseeing its funds and measuring the returns they produce against nationally recognized standards and metrics for investment performance. The Investment Committee actively monitors the financial markets to control risk and evaluate exposure for all asset classes. The Oklahoma United Methodist Foundation serves as investment manager and advisor to the Board of Trustees’ Investment Committee. In managing the endowment, the University seeks to balance the dual objectives of enhancing the future purchasing power of endowment funds and meeting current spending needs. The endowment is invested with a long-term horizon to ensure that it will grow at a rate above inflation, while providing a stable stream of income to support the purposes for which its funds were created. Endowment growth is due not only to the generosity of thousands of alumni, friends, corporations, and foundations through the years, but also to the careful stewardship provided by the Board of Trustees.
Asset Class Overview OCU’s directly managed endowment portfolio of $62,269,984 was composed of these asset classes as of June 30, 2015. The guiding principle of OCU’s consolidated endowment program is that funds should be managed so that a gift today will fund a donor’s objective in perpetuity.
Broad Asset Allocations
Detail Asset Allocations
OCU Endowment — $62.2 million
OCU Endowment — $62.2 million Cash / 1.8% U.S. Equity Fund / 36.0% Equities / 57.3% Fixed Income / 36.8% Alternatives / 5.9%
International Equity Fund / 21.3% Fixed Income Fund / 21.7% Inflation Protection Fund / 8.4% Alternative Investments / 4.3% Mineral Interests / 1.6% Notes Receivable / 4.9%
Investment Performance Net of Fees • As of June 30, 2015 OCU Endowment Lipper Median 35% S&P 500 Index / 20% MSCI EAFE Index / 45% BC US Aggregate Intermediate Index
Notes 1 Lipper Median returns from the Lipper mutual fund universe for balanced funds in the asset class category. As of 7/14/15, the universe consisted of 4,953 peers. Source: Wilshire Associates and Lipper. 2 Historical returns are time weighted for fiscal years ended 2015, 2014, and 2013. Historical returns prior to 2013 were calculated using the simple Dietz method. Returns greater than one year are annualized. 3 Past performance is no guarantee of future returns.
#25 among Best Regional Universities by U.S. News & World Report / 2015
$2.9 million was made available through the endowment to support OCU students, faculty, and programs during fiscal year 2015.
DR. GEORGE RANDALL Personal Connection When George Randall was a high school senior in the early 1960s, he knew he needed a scholarship to fulfill his dream of going to college. He received the Great Plan Scholarship from OCU, where he earned his bachelor’s degree and met his wife, Mary Ellen. George built a successful medical practice in Wichita, Kansas, where he and Mary Ellen live today. He was inspired to give back to the school and the scholarship that played such an important part in his life. He reconnected with OCU through the alumni board and eventually became a trustee. Dr. Randall reached out to other alumni who had received the same scholarship in the 1960s through the early 1980s, and together, they restarted and funded the program. Every year, the scholarship covers all of the costs for one student majoring in science. Many recipients have been pre-med majors, and some have become physician assistants. “We have had the chance to get to know many fine young people over the years and stay in touch with most of them to see how they mature and meet their goals.” Dr. Randall always checks in with current scholarship recipients and takes them to lunch when he visits Oklahoma City. “It’s been a great blessing for us to be a part of this scholarship and to be a part of the students’ lives. I always encourage the recipients to give back to the University as soon as they are able, and to students who would like to get an Oklahoma City University education but need financial help.”
100% of accounting graduates from the Meinders School of Business receive job offers before they graduate.
NEW ENDOWMENTS The following list represents new endowments established between July 1, 2014 and June 30, 2015. These funds will benefit future generations of outstanding and deserving Oklahoma City University students in perpetuity. Doers Cultural & Educational Foundation World House Endowed Scholarship Fund
This endowment fund was established in 2015 by Dr. Lin Wei-Hsien. All Doers Cultural and Educational Foundation World House scholarship recipients participate in service learning projects; complete courses addressing issue of peace, justice, and ecological sustainability; and are required to complete at least one approved international education experience while at OCU.
Roy W. Chandler Business Endowed Scholarship
This endowment fund was established in 2015 by the Clyde R. Evans Charitable Trust in honor of Roy W. Chandler, whose success in business and leadership in the community serve as an inspiration to OCU students pursuing business degrees. The scholarship will provide financial assistance to full-time students enrolled in the Meinders School of Business.
Brandon L. Hubbard Endowed Scholarship
This endowment fund was established in 2014 by Carol and Frank Williams to provide assistance to students enrolled in the Kramer School of Nursing. The fund provides tuition support for full-time OCU nursing students with high academic standards and demonstrated financial need.
Kurt & Cathy Leichter Business Scholarship
Kurt and Cathy Leichter established this endowment fund in 2015 to provide financial assistance to students enrolled in the Meinders School of Business.
The initial gift successfully served as a matching challenge to encourage the participation of others to provide scholarship funding for Meinders students.
Frances McMillan Oney Endowed Scholarship
Ted and Frances Oney established this endowment fund in 2015 to provide financial assistance to students enrolled in the vocal music program at Oklahoma City University. Awards will be given annually to recipients who are undergraduate, soprano students.
Mark Parker Endowed Scholarship
This endowment fund was established in 2015 by members of the Wanda Bass School of Music Advisory Board to honor Dean Mark Parker for his 25 years of service to Oklahoma City University. It will provide scholarships to deserving music and theatre students, with available funds divided equally each year between the School of Music and the School of Theatre. Recipients of the scholarship must be full-time undergraduate or graduate students enrolled in a degree program in either school.
Dr. Lin Wei-Hsien Endowed Education Scholarship Fund
Established in 2015 by Dr. Lin Wei-Hsien, this endowment provides assistance to students enrolled in the Petree College of Arts & Sciences. The fund provides tuition support for full-time OCU students pursuing bachelor’s degrees in education in preparation for careers in the teaching profession.
1,370 Kramer School of Nursing alumni are practicing across all major health fields.
ENDOWMENT FAQs What is an endowment?
Individual endowments represent the legacy of benevolent donors who invest for long-term growth. An endowment is timeless because the corpus of the endowment fund is not depleted. Instead, the investment income and gains earned from an endowment advance the strategic vision of the donor on a continuing basis.
Why are endowments important?
Endowments build a legacy of support that spans generations. As a permanent legacy, they will continue to give educational opportunities to the most talented students long into the future. They also allow OCU to recruit and retain the best teachers to build programs and act as esteemed mentors to our students.
What are the minimum endowment levels to establish a named endowed fund?
The minimum gift required to establish a named endowment fund is $25,000. Endowment gifts can be pledged and paid over a period of up to five years. Some examples of minimum guides for named endowed funds are: • Scholarship: $25,000 • Professorship: $500,000 • Chair: $1,000,000+
Whose name is on the endowment?
Donors are encouraged to name their endowed fund in a way that is meaningful to them. Many donors establish an endowment in honor of a specific person – a family member, professor or coach – and name the fund accordingly. Endowments can also be named more broadly for the discipline they support or the group or individuals who establish them.
How is an endowed fund invested?
OCU adheres to investment policies intended to provide a balance of risk and return in the portfolio. The investment portfolio is diversified to keep volatility within acceptable limits for the portfolio as a whole. This provides the greatest assurance that future generations benefit from the endowment as much as current students.
When will an endowment begin generating payout that can be spent?
Once the initial gift has been received, the minimum required funding levels have been achieved, and all required paperwork has been completed, initial payout of funds typically will become available within one year.
Can I give to an existing endowment?
How is the amount of annual payout determined and then distributed?
Can I choose what my endowment supports?
How does the endowment increase in value?
Yes. Unless you state otherwise in your memorandum of understanding when the gift is established, the fund can be left “open” to future gifts from you or others who choose to support the fund. While there is a minimum of $25,000 to establish a new endowment, there is no minimum gift required for increasing the size of an existing endowment. Yes. A number of donors to Oklahoma City University choose to restrict how their funds can be used. You can designate your gift to support a particular school or program, special initiative, library, or other opportunity at the University.
The amount of payout allocated each year varies because it is based on the market value of the endowment portfolio. The Board of Trustees reviews and approves the spending rate annually. The average spending rate for the past five years has been approximately five percent of the endowment’s average market value.
While investment returns help to fuel the growth of OCU’s endowment, the addition of gifts is more important over the long term. Recurring contributions are important because this allows for averaging the cost basis over time.
ADVANCING OCU Cash, securities or planned gifts are excellent ways to build an existing endowment or establish a new fund.
Office of Advancement & External Relations
Marty O’Gwynn
Elizabeth Sheppard, cfre
(405) 208-7000 give@okcu.edu okcu.edu/give
Vice President for Advancement & External Relations mlogwynn@okcu.edu
Assistant Vice President for Development easheppard@okcu.edu