Tufts' endowment grew more rapidly last year than that of any other American university, according to a study by the National Association of College and University Business Officers (NACUBO).
The study found that Tufts' endowment grew by 43.8 percent between the end of fiscal year 2005 and the end of fiscal year 2006. This rate is more than quadruple the average growth, which NACUBO listed at 10.7 percent.
Harvard and Yale's endowments, the two largest in the country, grew by 13.5 percent and 18.4 percent, respectively.
The striking surge in Tufts' endowment "was attributable to three factors: excellent investment returns, outstanding success in fundraising and good operating performance," Tufts University President Lawrence Bacow said in an e-mail to the Daily.
"We received $195 million in cash gifts for the endowment in fiscal 2006," Bacow said. Leading the way were alumni Pierre and Pam Omidyar (LA '88 and LA '89, respectively), who donated a record-setting $100 million last year. Donor Jonathan Tisch (A '76) contributed $40 million.
Aside from these contributions, Tufts also had a 13.9 percent return on its investments, according to Vice President of Finance and Treasurer Thomas McGurty.
"This amount significantly exceeded the amount we planned on in the budget," he said in an e-mail.
NACUBO valued Tufts' endowment at the end of fiscal year 2006 at $1,215,413,000, marking the first time in Tufts' history that the endowment reached upwards of a billion dollars.
"We are pleased with our endowment performance this past year, but we are still underendowed relative to many of our competitors," Bacow said. "That said, our recent success has helped us to close the gap."
According to Associate Professor of Economics Thomas Downes, universities employ several methods to fortify their endowments.
"The endowment is put into a variety of investments, most of which are stocks and bonds," he said. "The larger the endowment, the more income you're getting and the more flexibility you have for budgeting."
The growth in Tufts' endowment has come in the midst of the capital campaign "Beyond Boundaries," which was officially announced in November 2006. The quiet phase of the campaign began in 2002.
Although the campaign has a score of goals, one of them will be to increase the size of the endowment. "Clearly, the campaign is off to a good start," Bacow said.
He said that one result of this success is that Tufts has demonstrated to its donors that the university is a good steward of the resources entrusted to it.
"Fortunately, good investment performance is viewed very favorably by potential donors, so we hope our recent success will help us in our efforts in the future," he said.
NACUBO, the group that conducted the study, is a nonprofit organization that represents administrative and financial officers from more than 2,100 colleges and universities, according to group's director of research and policy analysis Jessica Shedd.
The research on endowments is done in order to help its members, she said in an e-mail. "The study results allow them to benchmark their own endowment performance and management data against those of their peers and higher education as a whole," she said.
