A Foundation for raising funds

Stacy J. Willis

Friday, Dec. 4, 1998 | 11:11 a.m.

Do you want to buy a philosophy professor for the university? How about a health sciences program?

A gift of $250,000 here or $10 million there will go a long way toward helping the UNLV start new programs or expand existing ones.

But the increasing role of private donations in the public education system brings with it new concerns for administrators.

First, the bulk of donations is earmarked by donors for specific programs -- causing funding disparity between schools within the university and raising questions about whether donors are buying influence over UNLV's academic character.

Second, as reliance on gift money becomes more important, deans, department chairpersons, and even faculty members are being asked to schmooze philanthropists and package academic programs to be "more saleable" to benefactors.

"Fund raising is very important to public universities now, and that wasn't the case 10 or 15 years ago," said John Gallagher, executive director of the UNLV Foundation, the university's fund-raising arm that raked in a record $28 million for buildings, programs, and scholarships in fiscal 1997-98.

The need for private dollars to help fund state colleges is a result of a nationwide increase in the number of students who attend college and the inability of states to keep up by using traditional tax revenue sources.

Schools aiming to be competitive in recruiting top students have been forced to develop a more diversified approach to funding. Leading public universities rely on state appropriations for as little as 20 percent of their operating budgets, Gallagher said.

About 47 percent of UNLV's operating budget comes from state appropriations -- a percentage that Gallagher expects to drop in the next several years. The remaining 53 percent is funded by private donations, federal grants, tuition, and auxiliary income from sources such as parking fees.

"It is becoming progressively harder for states to provide funding to meet all the demands of a growing university," Gallagher said. "The increase in the need for university fund raising really is a demand-driven phenomenon. We're raising considerably more money than we were -- we're raising consistently three times the money we were four years ago."

While everyone agrees that the influx of philanthropic cash is a boon to UNLV, the fact that the bulk of it is earmarked by donors for specific programs -- $26 million of last year's $28 million in donations was given on the condition that it benefit a specific program -- gives administrators new issues with which to grapple.

"Not every academic program is popular with people, and that is an issue. We tend to be market-driven," said Gallagher. "And you get some disparity between programs."

In fiscal 1997-98, market-driven gift winners were the William S. Boyd School of Law, which got $1.4 million, the William F. Harrah College of Hotel Administration with $809,513; the Greenspun College of Urban Affairs at $658,041, and the College of Health Sciences at $539,153.

But the College of Liberal Arts -- the largest college with more than 130 faculty members and 4,000 students -- received only $25,411 in gift money.

"There isn't a very large constituency for Liberal Arts," Gallagher said. "Programs that people understand and that have the greatest impact on day-to-day life are easiest to raise funds for -- in a place like Las Vegas, things like hotel management are easier."

Not all programs require the same amount of money to operate -- those with expensive lab equipment may indeed need extra funding. Gift money goes to colleges in addition to the funding each receives from other resources, the bulk of which is distributed according to a formula based on the number of faculty and students -- which covers Liberal Arts equally among other schools.

But philanthropists' selective disbursement of gift funds influences which programs can grow and has caused a change in the dynamics of college administration. In addition to some schools getting more cash for equipment and projects than others, faculty members are being asked to work with the Foundation to make their academic programs more appealing to benefactors, said James Frey, dean of the College of Liberal Arts.

"It's part of all of the deans' job descriptions now -- that they work on fund raising some," said Frey, who has been at UNLV for more than two decades and has been dean for two years. "It's not something that faculty are used to doing.

"It's even ferreting down to department chairs and professors. I don't mean that they are beating the streets looking for money, but they need to be able to meet with interested benefactors and talk about their projects."

Recently, Frey has taken professors of archaeology and history to meet with philanthropists in order to gain funding for academic projects. Additionally, he is working with Foundation development officers to "give them projects that are more saleable."

"There are those projects that are sexier...There are programs that are an easier product to sell. But finding someone who wants to give a half million dollars to Philosophy is a tough sell," Frey said. "People don't see Liberal Arts as something transferable to vocational skills -- but it gives you life-long communication and critical thinking skills."

The specific interests expressed by donors have caused the Foundation to assign development officers to individual colleges to raise money specifically for that college.

Already the foundation has an officer assigned to the Colleges of Hotel Administration and Business, and two assigned to athletics -- traditionally a big money-maker. This month, Gallagher expects to assign new officers to the Colleges of Fine Arts, Engineering, Science, Urban Affairs, Health Sciences and the library.

"We'll do liberal arts next year," Gallagher said.

The positions are "shared staff positions," Frey said -- funded partially by the colleges, and partially by the Foundation.

"I am very interested in having a development officer for this college," said Frey. "There isn't anyone to orchestrate a campaign here. But part of the problem is that the college would have to support the position -- these are shared positions -- and we don't have a lot of money to do that right now.

"But Liberal Arts is going to get into the game somehow. We're not going to go by the wayside. Liberal Arts make up the core curriculum for students -- you're not going to have a state university without liberal arts."

Not all gifts are accepted by the Foundation. Gifts that are designed to create academic programs outside of the university administration's master plan are declined, Gallagher said.

For example, the Foundation declined $250,000 from a man who wanted to fund a professor to teach a "disproven" scientific theory.

"If it doesn't fit in our institutional directive, we won't accept it," Gallagher said. "The university is run by the President and the Board of Regents. It doesn't happen very often that someone is overtly trying to affect policy -- most people have pure philanthropic intent and sometimes a personal interest in a particular program."

Although many big contributors prefer to remain anonymous, others like to have their names tacked onto the colleges or buildings they fund. Thus, UNLV is home to the William S. Boyd School of Law, the Greenspun College of Urban Affairs, and the forthcoming Lied Library, among other personally named programs and buildings.

Sixteen percent of donors are corporations, and though UNLV has yet to see anything like the "Wells Fargo School of Banking" arrive on campus, many public universities have named buildings -- and even classrooms -- after the corporations who funded them.

"That's not out of the question here, we may see it some day," Gallagher said. "Corporations just haven't reached that magnitude here yet."

Most of UNLV's philanthropists are homegrown business people who have become wealthy as the Las Vegas economy has grown -- Gallagher said that 95 percent of the money comes from donors who live "within 30 miles" of campus.

"One of the first rules of fund raising is that if you want to raise money, you have to go to people who have money to give," Gallagher said.

UNLV has a negligible percentage of foreign donors, but schools nationwide are beginning to attract the attention of international philanthropists. Last month, the Massachusetts Institution of Technology, a private school, received a $27 million gift from a Japanese software industry businessman -- the largest gift ever by a Japanese individual to a foreign institution.

UNLV's benefactors are wooed by the 33-member Foundation staff and by the 60-member Foundation Board of Trustees. The Foundation is a non-profit corporation separate from the university, set up for the exclusive purpose of raising funds to give to UNLV. Trustees are volunteers who are "well-connected in the community, demonstrate affection for UNLV, are high-energy, articulate and willing to invest time," Gallagher said.

They are also expected to donate at least $5,000 themselves.

"This is a relationship business," Gallagher said. "And the success is happening for us now because (UNLV President) Carol Harter has created a climate in which fund raising can occur -- a climate that says, 'This university is going somewhere.'

"But she also closes deals. That's not common in a university president. It's not easy to sit across the table from someone and say, 'I want you to give us $10 million dollars,' and then shut up and let them think about it. But she talks to the benefactor in some cases and closes the deal."

Gallagher credits Harter with sealing the $1.4 million deal with businessman William Boyd to fund the new law school, among other 7-figure donations.

But in the trenches, deal-closers like Foundation development officer Russ Kost do legwork ironically by pitching exactly what, in the end, draws scrutiny: the ability to choose where the money goes.

By networking with insurance agents and estate planners ("allied professions"), Kost specializes in tapping into the largest shift of money this nation has ever seen -- the transference of wealth from Baby Boomers' parents to the Boomers. As a non-profit, the university makes a nice place to donate money that might otherwise be eaten by taxes in inappropriate investment plans, Kost said.

"Which would you rather be, a good taxpayer, or an informed benefactor?" Kost said.

"If a portion of your wealth is going to go to social capital, that is, to the government in the form of taxes, why not instead choose what good it's going to do?" Kost said.

"You can reflect your values in giving to the university."

archive