October 11, 2007

Capital Campaign Ahead of Schedule

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“We have work to do,” said President David Skorton on Oct. 26, 2006 when he officially announced the launch of Cornell’s capital campaign.
Less than a year later, it seems the administration has taken its president’s words to heart, having raised $1.72 billion out of the proposed $4 billion over five years.
“The campaign has made very strong progress since our public launch last October,” said Jim Mazza, campaign director. “During the past fiscal year, which ended June 30, Cornell had its most successful fundraising year in its history, with $754.8 million in new gifts and commitments, with nearly $300 million designated to priorities on the Ithaca campus and the balance to initiatives at Weill Cornell Medical College. At the same time, gifts to the Cornell Annual Fund reached record levels: $18.4 million, a 29 percent increase over last year.”
Fifty-four percent of gifts to the capital campaign are from alumni. The largest gift to date is Sandy Weill’s $300 million commitment, $50 million of which will go towards funding the Life Sciences Technology Building to be named Weill Hall. However, the average gifts are significantly smaller, many under $100. Older alumni tend to make larger donations, but participation has been consistent across all age groups five years out of Cornell.
“The two things that [alumni] are embracing and understanding is the tremendous need to make sure that any student who wants to get an education at Cornell can get an education no matter what their financial background and needs are, so scholarship support has been really popular and well received,” said Charles Phlegar, vice president for alumni affairs and development. “And then there is a real understanding about the fact that we’re going to have to replace 600 of our faculty members over the next 10 years and the importance of raising money to be competitive during this transition.”
The remaining 46 percent of gifts to the campaign is a combination of gifts from corporate donors, foundations and unaffiliated individuals.
“You name any Fortune 500 company, and many of them make gifts to Cornell. But they really don’t make gifts any longer; [the gifts are] more investments in things they’re interested in. A lot of corporations give scholarships because they are recruiting our graduates in a particular discipline. They are investing in research we’re doing; it’s more of a partnership, a collaboration,” said Phlegar.
Unlike its peers, Cornell is a land-grant institution, and receives significant public funding for its non-endowed colleges. However, this large pool of public funds is not included in the capital campaign.
“Our campaign results only include private gifts from individuals and grants from foundations [and corporations]. The majority of our gifts come from individuals — generally more than 80 percent. Public sources of funding, such as state and federal grants, while essential to the University, are not counted as part of the campaign,” said Mazza.
Distribution of proceeds from the capital campaign remains unchanged from last year. The University will focus spending on four main areas: $1.885 billion will go towards faculty and program support; $1.175 billion will go towards new facilities and infrastructure; $640 million will go towards support for students; and the remaining $300 million is earmarked for unrestricted support.
As funds are raised, the administration uses them immediately for their intended purposes, so both current and future students will benefit. The way funds are spent depends on the type of money raised and the intent of the benefactor.
“We raise money that we call annual money; it comes in and is spent that year for all kinds of things. It could be spent on a student scholarship; it could be spent on purchasing research equipment; it could be used for building costs, so there are hundreds and hundreds of things that the money is spent on an annual basis,” said Phlegar. “We also raise money that comes in as an endowment and that money is in perpetuity, so we invest that money and we spend the interest income off of that on an annual basis. So if I made an endowed gift for scholarships, a percentage of the interest earned would go to fund the scholarship that I made the gift towards.”
“Also, campaign gifts and pledges tend to result in cash to the institution over a fairly long period [of time], extending years beyond the campaign close,” said Carolyn Ainslie, vice president for planning and budget.
Generally, fundraising becomes harder as a capital campaign progresses into its second year because most people who are willing to donate have already donated. However, with only 27 percent of Cornell’s “mailable” alumni contributing last year, there are promising prospects for sustainable fundraising.
Going forward, Skorton will continue to play an important role, acting as a catalyst for fundraising and gifts.
“With a presidential transition, many of our key alumni, key donors have not made their campaign gifts. Many of them will wait to see the new President and take the opportunity to interact with him, see what his vision and direction he has for the University are,” said Phlegar. “He’s a very, very skilled fundraiser. I think it will get easier in this campaign, instead of harder.”