What are recent trends in foundation giving to higher education?

U.S. foundation support for colleges, community colleges, universities, professional schools, and graduate schools totaled an estimated $7.27 billion in 2002, up from $4.2 billion in 1997.

According to the Foundation Center's new Update on Funding for Higher and Graduate Educational Institutions, funding for these institutions decreased 1 percent in the latest year, compared to a 0.7 percent dip in overall foundation giving. Nonetheless, foundation support for these institutions was almost $630 million higher than in 2000, and they continued to benefit from by far the largest share of foundation support.

"In the current economic climate, many foundations have cut back on the number of extremely large, multi-year commitments they make," noted Loren Renz, vice president for research at the Foundation Center. "This has had a slightly greater impact on colleges and universities, which are more likely to receive these types of grants." Higher and graduate educational institutions were also less likely to be the beneficiaries of the exceptional giving that took place in the aftermath of 9/11. But despite this short-term decrease, "Support for these institutions will remain a priority for many of the nation's grantmakers."

Among key findings from the report:

Funding Grew More Slowly than Overall Giving between 1997 and 2001. Foundation grant dollars awarded to higher and graduate educational institutions rose 93.6 percent during this four-year period, while overall giving by sampled foundations climbed 111 percent. By number of grants, support grew at roughly half the rate of giving overall (22.6 percent vs. 44.8 percent). Despite this slower growth, higher and graduate educational institutions continued to account for the largest share of grant dollars (25.6 percent) and tied arts and culture for the second largest share of grants (14.7 percent).

Institutions Benefited from Broad Foundation Support. More than nine out of ten foundations (94 percent) in the 2001 sample awarded grants to higher and graduate educational institutions. Still, the ten largest funders of these institutions alone accounted for over one-in-three grant dollars. Foundations awarding at least $100 million to higher and graduate educational institutions in 2001 included the William and Flora Hewlett, Robert Wood Johnson, Ford, and Robert W. Woodruff foundations and the Lilly Endowment.

Foundations Represented an Important Source of Capital Support. More than three-in-ten grant dollars awarded by foundations to higher and graduate educational institutions in 2001 funded building and renovation, endowments, and other capital projects. By comparison, capital support accounted for roughly two-in-ten grant dollars in the sample overall. Not surprisingly, foundation giving to these institutions was also much more likely to fund student aid and research.

From Foundation Center 4-23-05