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Economy takes toll on college donations

| Sunday, July 27, 2003

During the last days of June, Carlow College in Oakland barreled into overdrive to meet a $434,000 goal for its annual fund.

Fund-raisers hustled alumnae and friends who had not yet given -- asking them to donate by credit card rather than by check so they could use their gifts immediately.

At 3:20 p.m. on June 30, Leslie Braksick, CEO and president of Continuous Learning Group, charged a $4,000 donation on her Visa card. Her gift came scarcely 90 minutes before Carlow closed its books for the fiscal year.

"She could barely hear us," recalled Patrick Joyce, vice president of college advancement, "because everyone was cheering and applauding the fact that we had done it in a tough year."

The nation's sour economy has created a difficult environment for Carlow and other colleges and universities as they scrambled to meet fund-raising goals. This year, though more promising, is still difficult.

Nationally, gifts to higher education dipped from $24.2 billion in 2001 to $23.9 billion last year. That's the first decrease since 1988 and only the second since 1975, according to a study by the Council for Aid to Education in New York City.

Twenty-three schools, including the University of Pittsburgh, are in the midst of billion-dollar campaigns. The largest is a $2.4 billion fund drive by UCLA.

Large institutions are faring better during the economic decline. Pitt is on target to reach its $1 billion goal. And Carnegie Mellon and Penn State universities have successfully completed their campaigns.

"The message of the economy in the last few years has been more sobering," said Pitt Chancellor Mark A. Nordenberg. "It is a testament to the strength of our program and the effectiveness of our outreach effort that we have maintained the momentum of the campaign even as the economy has slumped."

Pitt bucked the national trend, surpassing its goal of $600 million by the end of June. The university closed the fiscal year with a total of $602.5 million in gifts.

During the campaign, 113 donors gave Pitt at least $1 million. Of those, 19 had never contributed to the university before.

One Pitt donor is Jim McCarl, 56, of Franklin Park. He attended the University of Virginia on a football scholarship but fumbled on the academics. Pitt admitted him into its College of General Studies in 1968. He graduated and is now president and CEO of the McCarl Group, a consulting firm.

In gratitude, McCarl and his wife, Carol, have given Pitt $650,000 to create the McCarl Center for Nontraditional Student Success. They gave another $150,000 for the McCarl Hall of Champions, which was dedicated in the Petersen Events Center earlier this year.

"I tell people three things made me the man I am today -- my God, my wife and my university," he said.

To meet its billion-dollar goal, Pitt is seeking money outside Western Pennsylvania. When the Panthers' football team travels to Texas A&M this fall, Pitt will raise money for the first time in Dallas and Houston.

One obstacle has been a decline in grant making by foundations whose portfolios have tumbled with the stock market.

"It's very important to stay in touch with them," said Al Novak, interim vice chancellor of institutional advancement at Pitt. "You just don't want to knock on their doors when they have money."

By December 2000, Carnegie Mellon raised $410 million in a campaign with a $350 million goal. The university is planning another campaign but hasn't set a target, said Robbee Kosak, vice president for development.

She said the university has introduced an online program that makes it quicker and easier for alumni to give. The university is also more focused in its approach.

For example, Carnegie Mellon asks engineers to support school engineering projects, and business alumni to support the business school. To be more personal, students and alumni solicit alumni by phone or in person and, beginning last year, call back to thank them for their gifts.

At the end of June, Penn State ended a campaign that began with a $1 billion goal and raised nearly $1.4 billion.

To get that much, the university received 210 gifts of at least $1 million, said Peter Weiler, associate vice president of development and alumni relations. Of those, 33 donations were of at least $5 million.

Carlow achieved its goal this year, but set a lower target than the $500,000 it had raised the year before.

"Twenty of our largest donors decreased their gifts, citing the market and uncertainties with the economy," Joyce said.

Carlow topped its goal by persistently pursuing friends like Braksick. She had received a Woman of Spirit Award from the college last year for her contributions to business in the region.

"Once I became aware that they were behind in their fund-raising campaign, I contacted people who were also Carlow supporters to alert them," she said.

Carlow expects to enter the public phase of a capital campaign in the next two years. Sister Grace Ann Geibel, Carlow president, has said it could be as high as $40 million.

Joyce is confident the campaign will succeed because of last quarter's uptick in the stock market.

Like Carlow, La Roche College in McCandless has seen its cash contributions decline over the past two years. La Roche raised $2.7 million last year and $2.6 million this year.

The problem was a decline or delay in gifts from some of the college's major donors because of the economy, said Kenneth Service, vice president for institutional relations.

The college compensated by tripling the percentage of alumni who contribute. That figure rose from 3.6 percent to 10.6 percent.

But the hunt for major gifts can be risky, said John Lippincott, a spokesman for the Council for Advancement and Support of Education, based in Washington, D.C.

"In the past, 90 percent of your money came from 10 percent of your donors," he said. "Now people are saying 95 percent of your money will come from 5 percent of your donors."

Cash gifts to local institutions


Last year was a tough year to raise money in higher education, and 2003 looks a little better. Here's a sample of fund-raising efforts by colleges and universities in the area. The figures below count only cash contributions, not pledges.

Institution 2002 contributions 2003 contributions
Carlow College $500,000 $434,000
Carnegie Mellon University $36.5 million $41 million
La Roche College $2.7 million $2.6 million
Penn State University $180.7 million $181.3 million
University of Pittsburgh $75.4 million $92.4 million

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