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CURRENT ISSUE:  February 23, 2009
VOL. 47, NO. 4   •   Oakland, CA
Other front page stories
Immigration changes possible within authority
Renewal of marriage vows
Colleges optimistic
despite endowment drops

While the currently miserable economic situation is affecting mortgages, pensions, jobs and morale, one sector seems to be moving through the crisis with a less than disastrous impact — private colleges and their endowment funds.

Spokespersons at two local Catholic institutions and one seminary report that their endowments have suffered some loss of funds, but not enough to affect scholarships, grants, work study programs and student enrollment — at least for the present time.

Responding to a recent Voice query directed to the East Bay‘s two Catholic colleges and three seminaries in Berkeley, St. Mary’s College in Moraga, Holy Names University in Oakland and Franciscan School of Theology in Berkeley said they are holding their own, endowment-wise.

The market value of St. Mary’s endowment fund was $114.8 million as of Dec. 31, 2008, said Michael Beseda, vice provost for enrollment. This represents a 24.4 percent loss ($37 million) between July 1 and Dec. 31. But he said endowment spending provides only six to seven percent of its operating revenues each year. That amounts to approximately $7.2 million in revenues in the school’s current fiscal year.

The decrease will have a negative impact on scholarship spending over time, “but not immediately,” said Beseda, who explained that the college applies a five percent spending rate to a rolling 12-quarter average of its endowment market values so that the impact of a one- or two-quarter change in endowment market values does not have an immediate effect on the spending amount. “This tends to smooth out the short-term volatility that can occur in financial markets,” he said.

One recent development — a challenge grant issued by a generous regent, could actually increase the number of scholarships, he said.

In another gesture of optimism, St. Mary’s College is planning to hire additional staff for its alumni and development offices. “It was already in our plan before the economic crisis,” said Beseda.

Beseda said that 1,649 of the school’s 2,431 undergraduate students receive scholarships and grants from various institutional sources. St. Mary’s tuition is $33,100 per year, with another $15,000 for room and board. Each student receives nearly $30,000 in financial aid. So far, there has been no decrease in enrollments, he added.

Holy Names University lost $2 million of its $6.7 million endowment through December of 2008, reported Dav Cvitkovic, vice president for advancement.

However, Cvitkovic stressed that the effect on scholarship and grant money will be minimal “since the majority of our scholarship money is from unfunded sources. The endowed source of scholarship funds is approximately three percent of our total financial aid budget.”

About 90 percent of Holy Names’ 1,064 students depend upon scholarships and grants, said the vice president. Annual tuition and room and board fees at the Oakland university run anywhere from $34,500 to $36,780 depending upon housing and meal plan choices.

Cvitkovic said that Holy Names does not have any plans to add fundraising staff this fiscal year. “We project that our fundraising results for this year will be at least even with last year.”

To date, the school “has not seen any extraordinary changes in enrollment,” she said.

Franciscan Father Michael Hill, chief financial officer at the Franciscan School of Theology, said the school has experienced “a rather small decrease” in its endowment, due to “our conservative philosophy in the management of funds.”

Enrollment, which currently stands at 75 students, has held steady “although we are in a declining population of folks who can afford ministerial training without the financial assistance of the parish and the diocesan community who benefit directly for their committed service,” he said. Full-time tuition is $12,000 per year, with an additional $2,000 for continuing fees.

FST is continuing to actively solicit funds to increase its endowment, because scholarships provide vital support to many of its students who are preparing for careers in religious ministries, said Father Hill.
St. Mary’s decision to hire more fundraising staff is part of an emerging trend among some Catholic colleges. Catholic News Service reports that Charles J. Dougherty, president of Duquesne University in Pittsburgh, has hired three major front-line fundraisers as well as four additional people for administrative jobs.

“We realized we needed to get more people out on the street if we wanted to compete for those all-important gifts,” he told attendees at a meeting of Catholic Colleges and Universities in Washington, D.C.

Mary Meehan, president of Averno College in Milwaukee, said her school has increased its staff in the development office “and we’re finding that people are more willing to give than we would have expected in this economy.”

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