Harvard Raises Near-Record $651 Million

Harvard officials announced Friday that the University raked in $651 million in the most recent fiscal year, a number that represents the second largest annual fundraising total in history and is six percent higher than the previous year’s.

The only year with higher fundraising was fiscal year 2001, in which Harvard brought in $658 million from donors at the end of the University’s last capital campaign.

The near-record number comes as Harvard lays the groundwork for a long-delayed capital campaign that was derailed by administrative turmoil surrounding the resignation of former University President Lawrence H. Summers and the subsequent interim leadership of Derek C. Bok.

Despite the fact that the University is not in the midst of a capital campaign, its fundraising level has kept it near the top of the heap in the world of higher education. In fiscal year 2007, Harvard’s $614 million haul was only exceeded by Stanford, which netted $832 million. The West Coast school is in the midst of a five-year, $4.3-billion capital campaign that is among the largest in the history of higher education.

Harvard’s most recent total was aided by a number of large donations, most notably a $100 million gift from David Rockefeller ’36—the largest ever from an alumnus—to fund international programs and the arts.

Other gifts included $25 million from Brazilian businessman Jorge P. Lemann ’61 to fund Brazilian studies, $15 million from an anonymous donor to fund science programs, $13 million from the estate of television mogul Alan Gleitsman to support social activism at the Harvard Kennedy School, and $10 million each to support the Harvard Divinity School and to fund research on energy and the environment.

The end of Harvard Law School’s capital campaign also boosted the total by $54 million. That campaign, which ended in June and is the largest in the history of legal education, “is expected to have exceeded its $400 million goal,” according to Harvard’s fundraising announcement last week.

Though gifts to the University as a whole continued to increase, as they have for the past few years, the Faculty of Arts and Sciences saw a drop in donations from $205 million in fiscal year 2007 to $191 million this year.

Harvard has been revamping its fundraising operations to emphasize cross-school gifts and support less wealthy schools such as the Harvard School of Public Health and the Divinity School. The shift has at times ruffled feathers at wealthier schools like the FAS amid concern the new priorities may lower their school’s take.

The announcement of the near-record fundraising coincided with the news that Harvard’s endowment grew 8.6 percent in the most recent fiscal year, a strong investment performance in the face of recent market turmoil.

Though the strong investment returns and fundraising are good news for the University’s financial health, such growth could become a public relations liability in light of accusations from lawmakers, namely Senator Charles E. Grassley, that the nation’s wealthiest universities are hoarding money to build their endowments rather than spending more aggressively on financial aid.

Grassley, an Iowa Republican, has floated the possibility of mandating a minimum five-percent payout rate for higher education endowments, similar to the current standards for foundations and other charities that receive tax-exemptions.

Harvard sets five percent as its payout goal but has exceeded that mark only once in the past decade. This is in large part due to consistently high investment returns, as the five percent target is based on a projected endowment growth rate of eight percent, which the last decade of returns has proven to be a conservative projection.

Indeed, though Harvard upped its payout this year to $1.6 billion, its highest total ever, the payout rate as a portion of the endowment was just 4.6 percent.

—Staff writer Clifford M. Marks can be reached at cmarks@fas.harvard.edu.

—Staff writer Nathan C. Strauss can be reached at strauss@fas.harvard.edu.