For the first time since we began reporting the Top Ten HBCU endowments, an HBCU endowment that we knew should be present but was not reporting is now present – Morehouse College. Hopefully next year we will see Tuskegee University join the fray. This provides a far more accurate picture of the HBCU endowment picture, at least at the top. While many will wonder why the endowments do not appear larger after massive donations that happen in 2020, it should be understood that many donations will not be reflective in the institutions endowment figures until fiscal year 2021 is reported so expect to see massive jumps for many HBCUs in the next calendar year.
However, examining the HBCU endowment world prior Mackenzie Scott’s 2020 philanthropy shows Howard University powering ahead toward becoming the first HBCU endowment to $1 billion. Their lead over number two Spelman extended from $302 million in 2019 to $355 million in 2020. Unfortunately, only four of the ten HBCU endowments saw increases in their endowment market value, while amongst the PWI’s Top Ten endowments all ten saw increases in their market value.* The Top Ten PWI endowments for 2020 combined for $199.8 billion versus $2 billion for the Top Ten HBCU endowments showing an institutional wealth gap of almost $100 to $1.
There is going to be a continued mixed bag of endowment reality among HBCUs. The Have and Have Nots among HBCU endowments has exacerbated and despite the attention during 2020 most smaller HBCUs have yet to secure donations that would secure their future. Even many of those who did are still sitting in a precarious perch. The NACUBO average endowment is over $907 million, an amount that is almost five times the average HBCU endowment and an average that not even Howard has reached yet. This means that while the “lottery” donations from non-HBCU sources is great, it absolutely does not remove the charge from HBCU alumni of being vigilant givers to their institutions. If HBCUs could simply get more of their alumni giving small amounts on a consistent basis that would do wonders for improving endowments. It goes without saying the other reality is that all HBCUs need to increase their student populations so that they are graduating more alumni and therefore more potential donors.
- HBCU Endowment Total – $2.0 billion
- Number of PWIs Above $2 billion – 55
- Number of PWIs Above $1 billion – 114
- HBCU Median – $95.6 million (-2.62%)
- NACUBO Median – $165.7 million (0.58%)
- HBCU Average – $187.7 million (0.13%)
- NACUBO Average – $903.1 million (1.56%)
All values are in millions ($000)
1. Howard University – $712,410 (2.83%)
2. Spelman College – $377,942 (-3.21%)
3. Hampton University – $280,598 (-0.69%)
4. Morehouse College – $157,081 (0.64%)
5. Meharry Medical College – $156,719 (-1.53%)
6. Florida A&M University – $95,635 (-2.63%)
7. North Carolina A&T State University – $73,809 (7.82%)
8. University of the Virgin Islands – $66,894 (-6.68%)
9. Tennessee State University – $63,020 (3.12%)
10. Virginia State University – $56,149 (-2.15%)
- Fayetteville State University – $24,764 (1.75%)
*The change in market value does NOT represent the rate of return for the institution’s investments. Rather, the change in the market value of an endowment from FY19 to FY20 reflects the net impact of:
1) withdrawals to fund institutional operations and capital expenses;
2) the payment of endowment management and investment fees;
3) additions from donor gifts and other contributions; and
4) investment gains or losses.
Take a look at how an endowment works. Not only scholarships to reduce the student debt burden but research, recruiting talented faculty & students, faculty salaries, and a host of other things can be paid for through a strong endowment. It ultimately is the lifeblood of a college or university to ensure its success generation after generation.