Although the most recent results of the University’s five-year fundraising campaign have exceeded expectations, the new gifts will not solve all of Yale’s financial woes.
With the University facing a $68 million deficit for the 2011–’12 academic year, administrators are looking to trim an already tight budget. University officials say the most recent tallies for the Yale Tomorrow campaign, set to end July 1, indicate the fundraising drive should outdo its $3.5 billion target and provide some financial relief — but most of the pledges will go into the endowment and construction projects with only a small portion allocated for operating costs.
“Although we cannot address all of Yale’s budget challenges through fund-raising, it certainly helps,” Provost Peter Salovey said in an e-mail Tuesday.
Yale Tomorrow had raised $3.338 billion as of the second fiscal year quarter, which ended Dec. 31, 2010, Vice President for Development Inge Reichenbach said. Donors have already pledged $313 million in the 2011 fiscal year, she added, doubling the amount the campaign raised in the same period last year.
University President Richard Levin, Salovey and Reichenbach all declined to predict a final total for the campaign, but Levin said he expects the final total will be “significantly” greater than the $3.5 billion goal.
All current-year giving funds — including gifts to the Yale Alumni Fund, the Parents’ Annual Fund and the Senior Class Gift — fall under the Yale Tomorrow umbrella, Reichenbach said. Salovey said these gifts go towards present needs, like teachers’ salaries and financial aid, and can have an immediate impact on reducing the budget deficit.
“All of the dollars have a direct relationship to our ability to close the budget gap,” Reichenbach said, adding that total giving to the Parents’ Annual Fund has increased by $1 million compared to the same time last fiscal year.
But gifts to long-term projects and the endowment do not reduce the deficit. While some go toward current programs and activities, others funnel into securing the University for the future, Salovey said. Donations are also often made for specific purposes and cannot always be used to fill holes in the budget.
Levin said administrators have not increased their focus on finding large donations to funds that are available for immediate use because donors making large gifts almost always prefer to contribute in ways that have long-lasting impacts on the University. These include gifts to the endowment or to specific construction projects. Levin added that it would be “counterproductive” to pursue large, unrestricted gifts to close a budget gap.
Still, Reichenbach said, the budget deficit has led her office to focus on raising gifts to support Yale’s “core needs,” which include endowment gifts designated for financial aid and professorships — expenses to which the University has already committed itself. Yale has found success in attracting donations to financial aid, Levin said.
Though donations continue to come in, costs on campus are still proving problematic. Administrators said over the summer that they hoped a round of budget cuts approved in May 2010 would be the last, but Levin and Salovey announced the need for additional cuts to balance the University’s 2011–’12 budget this January.
Yale’s 2012 fiscal year operating budget is approximately $2.7 billion, Salovey said.