<p>From the WSJ</p>
<p>Summers's Supporters Withhold $390 Million From Harvard
By Zachary Seward
1056 words
13 July 2006
The Wall Street Journal
B1
English
(Copyright (c) 2006, Dow Jones & Company, Inc.)</p>
<p>THE FALLOUT from Lawrence H. Summers's resignation as president of Harvard University has now hit the school's pocketbook, impairing the largest fund-raising operation in higher education.</p>
<p>At least four major donations to Harvard, totaling $390 million, have been scrapped or put on hold since Mr. Summers announced his resignation in February, according to people familiar with the matter.</p>
<p>The donors, who were supportive of Mr. Summers and elements of his vision for Harvard, have separately indicated that they won't contribute while the university is without a permanent leader. Under attack from arts and sciences faculty, Mr. Summers left office on June 30, and was succeeded on an interim basis by a former Harvard president, Derek C. Bok.</p>
<p>A Harvard official wouldn't comment on specific donations. "It is quite normal in situations of leadership transition in any not-for-profit organization for donors who are considering very major gifts to wait for a new leader to be in place before finalizing and announcing a major commitment," said Donella Rapier, Harvard director of development.</p>
<p>Ms. Rapier said Harvard's fund raising in fiscal 2006, which ended June 30, "continued to be quite strong into the fourth quarter," but said she didn't have year-end numbers yet.</p>
<p>Three of the withheld gifts would have been the largest in Harvard's history. They included $100 million from media mogul Mortimer Zuckerman to fund a neuroscience institute that has generated intense interest among Harvard researchers, and $100 million from Richard A. Smith, a former member of Harvard's governing board, to fund a 500,000-square-foot science complex planned for a new campus in Boston's Allston neighborhood.</p>
<p>At least one of the contributions was to be announced this spring: $75 million from David Rockefeller, the banker and philanthropist, to fund study-abroad trips for every Harvard undergraduate in need of financial assistance, a key element in Mr. Summers's plan to expand Harvard's global scope. Instead, Mr. Rockefeller downgraded his gift to $10 million, announced in May, for Harvard's existing Rockefeller Center for Latin American Studies.</p>
<p>Also, as previously reported, Oracle Chief Executive Larry Ellison recently reneged on a $115 million gift, citing Mr. Summers's departure.</p>
<p>The lost contributions amount to two-thirds of what Harvard raised in fiscal 2005, when the school was the third-largest fund-raiser in higher education. It's unclear exactly how close some of the gifts were to materializing, but all had been in negotiations for several years, said people familiar with them.</p>
<p>Even for Harvard, which led all U.S. universities with a $25.9 billion endowment as of June 30, 2005, the loss of such huge gifts could be seen as a significant setback. Adding to the blow, the gifts were to fund initiatives -- from study abroad to scientific research -- at the very top of the university's priorities.</p>
<p>The donor reaction may make other universities with smaller endowments think twice before casting off controversial presidents with strong alumni followings, and may elevate the impact of graduates in future power struggles at U.S. colleges between administrators and faculty.</p>
<p>Mr. Rockefeller declined to comment on his negotiations with Harvard. His spokesman, Fraser Seitel, said, "Mr. Rockefeller regrets that Larry Summers won't be leading Harvard in the future, but he continues to have great confidence in the university, and he does look forward to working with the new president when he or she is named."</p>
<p>Mr. Zuckerman, who contributed $10 million to Harvard during Mr. Summers's presidency for public-service fellowships and defended him after his resignation, said in a statement, "We were having very preliminary conversations on a number of other programs, and I look forward to working with the new leadership of Harvard on a whole range of projects."</p>
<p>Mr. Smith declined to comment through an assistant.</p>
<p>The donor backlash could hamstring the university's plans for a long-delayed capital campaign. It also suggests that the internal debate continues over the resignation of Mr. Summers. Last month, wealthy alumni voiced their frustrations with the university's governing board for not standing by Mr. Summers during two private dinners at the Harvard Club in Manhattan.</p>
<p>Mr. Summers, who declined to comment about the withheld gifts, assumed the Charles W. Eliot University Professorship at Harvard last week. He has maintained a high profile, recently rehashing his stormy tenure as president in a lengthy interview on the "Charlie Rose Show."</p>
<p>During Mr. Summers's five-year presidency, the proportion of Harvard alumni donating to the university steadily declined to 40% from 48%. Many graduates offended by his 2005 statements suggesting that women may be innately inferior to men at science and engineering, reduced their giving. But Mr. Summers's critics weren't donors on the same scale as those now withholding funds, with the result that Harvard on balance may suffer financially, at least in the short term, from his departure.</p>
<p>Total fund raising, in dollars, remained steady during Mr. Summers's term. Harvard raised $590 million in fiscal 2005, the second-highest level in its history.</p>
<p>Several other donors have also expressed dissatisfaction with the actions of Harvard's governing board. Byron R. Wien, chief investment strategist for Pequot Capital Management Inc. and a major Harvard donor, said recently that he chose not to give his usual annual contribution to Harvard this year in protest of what he regarded as the trustees' failure to support Mr. Summers. "It was my little wake-up call saying, look, there are multiple constituencies there," Mr. Wien said. "The students are a constituency, and they were very supportive of Summers. And the alumni are a constituency, and they were very supportive of Summers."</p>
<p>A presidential search committee is expected to begin interviewing candidates in the fall, hoping to install a permanent leader for Harvard on July 1, 2007.</p>
<hr>
<pre><code> Donor Dissent
</code></pre>
<p>Gifts to Harvard scrapped or put on hold </p>
<p>-- $100 million from media mogul Mortimer Zuckerman to fund a neuroscience
institute. </p>
<p>-- $100 million from Richard A. Smith,former Harvard governing boardmember,
to build new science complex. </p>
<p>-- $75 million from David Rockefeller to send every undergraduate abroad
during four years at college; instead, he gave $10 million to existing
Rockefeller Center for Latin American Studies.</p>