USC endowment lowest per student in SEC

Campus ranks far lower than other schools in Southeastern Conference; larger student bodies affect numbers, officials say

USC’s endowment per student ranked last of any university in the Southeastern Conference last year, but university officials say the fund is on the rise.

The endowment account, managed by the university’s Educational Foundation, holds and manages donations to the university from private donors. The endowment money is invested in various ways, and the income generated from the investments funds the university’s operating and building expenses among other things.

Recently, USC officials said they’d use $15 million from the fund to offset additional costs for the new business school.

The university’s total endowment of $414 million held just $12,451 for each undergraduate student in the university system during the 2010 fiscal year, which was well below the SEC’s 2010 median endowment per student of $25,320.

Vanderbilt, a private school, wasn’t counted in the calculations. Endowment per student figures were calculated using endowment data from the National Association of College and University Business Officers and Commonfund and used 2010 undergraduate enrollment figures.

Part of this low value can be attributed to the university’s relatively small total endowment being divided among a relatively large and growing student body. USC’s total endowment was the third smallest in the conference last year, larger only than endowment funds at Auburn University and Mississippi State University. Those schools have significantly smaller student bodies.

According to Russ Meekins, chief financial officer of USC Foundations and director of the Educational Foundation, the university’s funds are on the rise. Preliminary unreleased numbers show the endowment grew about 18 percent during the 2011 fiscal year to about $490 million, Meekins said.

Much of that increase was driven by returns on USC’s investments, which were nearly 24 percent for fiscal year 2010-11, slightly outpacing the Dow Jones Industrial Average, which increased 22.4 percent over the same period, according to Meekins.

USC has also outperformed its peers in the SEC in terms of investment returns.

“For the last two calendar years, we have led the SEC in investment portfolio performance,” Meekins said. The university has also benefitted from $24 million in state education lottery funds through the SmartState initiative and will launch a major capital campaign, dubbed Carolina’s Promise. The Daily Gamecock reported last month that Carolina’s Promise seeks to raise about $1 billion by June 2015.

At the University of Florida, which holds the second largest endowment in the SEC at $1.1 billion, capital campaigns and donor support have provided huge boosts to endowment levels.

Launched in July 2005, the Florida Tomorrow campaign set out to raise $1.5 billion for the university by September 2012, according to the Independent Florida Alligator; as of Sept. 30, says the campaign’s website, it has gathered $1.4 billion.

Steve Orlando, director of the University of Florida New Bureau, wrote in an email response that state support helped grow the university’s endowment as well.

“An additional support was the visionary State of Florida matching gift program that matched gifts of $100,000 or more,” he said.

The ability of USC’s efforts to increase the level of endowment per student, however, is tempered by the increase in size each year of the incoming freshman class.

“We’ve increased the number of students faster than we’ve been able to increase the endowment,” Meekins said.

On the Columbia campus, the size of the 2011 freshman class reached 4,500, exceeding the size of the previous year’s class by 100.

Meekins speculated that the university continued to increase its class sizes because of decreases in state funding. “They were able to increase the size of the class and also increase the quality of the class, which resulted in more tuition dollars,” Meekins said.

Provost Michael Amiridis was unavailable to comment late last week on the increased class size, though The Daily Gamecock reported Friday that after years of increasing class sizes, the university plans to keep the size of its classes level.

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