Penn endowment up, other Ivies see FY losses

The ailing economy has shown its effects throughout higher education, according to endowment figures from Fiscal Year 2002. While Penn's endowment -- which hovers near $3.4 billion -- actually saw an increase of approximately 0.1 percent during FY 2002, all seven of its Ivy League peers suffered losses, leading some to propose spending cuts. And according to a survey by the National Association of College and University Business Officers, the average return on endowment from the June 2001 to June 2002 period was negative six percent, The Chronicle of Higher Education reported last week. Among the Ivies, Dartmouth College and Cornell University saw the biggest percentage losses in FY 2002. Dartmouth's endowment fell from $2.4 to $2.2 billion, experiencing a 9.4 percent decrease. Dartmouth administrators released their 2004 budget plan Tuesday and announced important cuts in spending, including the consolidation of two libraries and reductions in course offerings, The Dartmouth reported earlier this week. "Directors looked for savings that would have the least impact on teaching and learning both in and out of the classroom," Dartmouth Provost Barry Scherr wrote in a letter distributed to the Dartmouth community on Wednesday. "This has been a difficult time," Scherr wrote. "But Dartmouth is strong fiscally, and we will move forward with our key priorities." Cornell's endowment also saw a 9.4 percent decrease in 2002. Cornell's endowment dropped from about $3.2 to $2.9 billion. "Like most of the other Ivy League schools, our returns have been negative for the past two years," said Donald Fehrs, Cornell's senior investment officer. "We are considering the impact, but no dramatic decisions have been made." Harvard University's endowment slipped for the second year in a row, dropping 4.4 percent from $18.3 to $17.5 billion in FY 2002, but remains the highest university endowment in the nation. Harvard's endowment reached an all-time high of $19.2 billion in 2000. "Thus far, there have been no cuts in spending," said Jack Meyer, president of the Harvard Management Company. Meyer added that considering the current condition of the economy, "Harvard's endowment has held up pretty well." Yale University's endowment, the second largest in the nation, fell 1.9 percent from $10.7 to $10.5 billion in FY 2002. Columbia University experienced a 2 percent endowment decrease last year, falling from about $4.3 to $4.2 billion. Brown and Princeton universities also saw drops in endowment over Fiscal Year 2002, though theirs were less severe. Brown's endowment fell 1.4 percent, and Princeton's fell 0.5 percent. Although Penn's endowment actually saw a slight increase in FY 2002, it did see a loss of 8 percent in the first quarter of FY 2003. Penn's endowment went down from $3.4 to $3.2 billion during that period, which ran from June to September of 2002. Despite Penn's endowment losses this quarter, the University still managed to outperform its benchmark figures. Many of Penn's peer institutions experienced an economic boom in the late 1990s, while Penn's endowment did not see any major growth. Penn benefited from its conservative investment strategies when many other schools were badly hurt by the telecom bubble burst, according to administrators.