Last year, Michigan’s endowment stood at $9.7 billion ($9.6 billion of which belonged to the Ann Arbor campus). This year, it jumped to $10.9 billion ($10.7 billion of which belongs to the Ann Arbor campus).
The article says the the Michigan endowment is the 9th largest overall and 3rd among public universities. That is not entirely accurate. The UT and Texas A&M endowments are for huge systems, which include over 10 campuses and 200,000 students each. The Austin and College Station campuses’ endowments are worth roughly 40% of their respective systems’ total endowments. In the case of Michigan, the Ann Arbor campus’ endowment is worth 98% of the Michigan system’s total endowment.
As far as single-campus endowments are concerned, the Ann Arbor endowment is roughly the same size as the Austin campus endowment (last year, Austin was $9.6 billion to Ann Arbor’s $9.6 billion), while College Station endowment is significantly smaller (definitely under $7 billion). This year, Michigan-Ann Arbor’s endowment may or may not have overtaken overtaken UT-Austin’s, but it has most likely overtaken Northwestern and clearly surpassed Columbia’s.
Some schools count quasi-endowments in their totals. Others don’t. Quasi endowment fund sources are typically operating funds rather than external donors or sources. If you look at UTIMCO (the organization that manages endowments for UT and A&M), they separate the operating funds from endowment funds. They also separate endowment funds from the Permanent University Fund (derived from 2 million acres of land) and institutional endowments (e.g. from donors). Anyway, yet another area where you have to make sure you are doing an apples-to-apples comparison.
Good point IzzoOne. Not all endowments are created equal. Even if the total is clear, as is the case with Michigan, one must also factor in or important aspects, such as the size of the university, state funding, the breadth and depth of programs available at the university, and the way that the endowment is used etc… For example, $2 billion of Michigan’s endowment is dedicated to the Medical school, while another $2 billion is earmarked for financial aid programs.
Let us take Princeton and Stanford. They have similar size endowments (both roughly $24 billion), but Stanford is double the size of Princeton (16,000 students vs 8,000 students), and Stanford also has very significant professional programs (including MBA and JD programs, and a Medical complex) which are draining. So Princeton’s endowment is significantly greater than Stanford’s, relatively speaking.
I agree. Princeton has an even more extraordinary endowment when you consider the size of the institution and the lack of professional programs.
Most institutions want their endowments to appear as high as possible. UT is a bit of a special case in that it has been trying to downplay the Permanent Fund for quite some time because it caused potential donors to perceive incorrectly that the school did not need money.
Looking back at the beginning post, it makes it sound like UT Austin (and A&M College Station) only get their per capita share of the money flowing from the Permanent Fund. It doesn’t work that way. The UT System gets gets 2/3rd of the fund, which is about $20B. Out of that, only UT Austin receives “Excellence” funding, which cannot be less than 45% of the total. It can be more than that. So at a minimum, UT Austin gets 30% of the overall total, which is about $6B. Out of that total, just like in other endowments, a percentage, typically about 5%, is made available each year.
However, UT Austin can also get additional amounts allocated. For example, it gets an additional $25M per year extra to support its new Dell Medical School. That is the equivalent payout from an additional $500M endowment. The remainder of the PUF is also used to pay for bonds, and UT Austin shares in this along with the other institutions. By enrollment, UT Austin is about 20% of the UT System, so that share could be estimated at about $1.4B.
So all total, PUF endowment calculated for UT Austin would be about $7.9B (but possibly more). Add to that UT Austin’s separate endowments of about $3.6B and you get about $11.5B for 2017. While all endowments can fluctuate with returns, UT Austin’s effective endowment can also change with how much the System allocates to it. This does not include operating funds, also managed by UTIMCO, which a number of institutions include in their endowment totals as “quasi-endowments”.