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That's not how endowments work. I'm 99.9999% positive that what you suggest would be illegal, and would land the administrators in prison. As a lawyer once ex
by bilbo0s 5y ago
That's not how endowments work.
I'm 99.9999% positive that what you suggest would be illegal, and would land the administrators in prison.
As a lawyer once explained it to me, if person X gives organization Y some amount of money Z for purpose W, then spending even a penny of Z on purpose Q is felony fraud.
I could be wrong, but that's how it was explained to me.
- kristjansson 5y agoRestricted gifts exist, but it's wrong to state categorically that the existence of restricted gifts precludes spending any endowment income on tuition. GP is also simplistic - not all the endowment income is available to cover operating expenses - but is directionally right. Lots of scholarships and the like offered by schools are transfers from the endowment to the operating budget mediated through a 'lower' tuition bill for the student. A relevant number to look at is the average income per student (money + loan proceeds) to the school - usually that's much, much less than the stated cost of attending.
- prepend 5y agoI’m sure there are exceptions based on the gifts, but I doubt all $35B have such restrictions. Also it seems odd that a large number of donors would have restrictions that prevent covering tuition and expenses of teaching.