Economy's Strain on Gifts May Not Affect Upcoming Capital Campaign, Donors Say
Though the University’s chief fundraiser reported an adverse effect on gift receipts compared to last year, University donors said last week that the current dip in numbers may not necessarily indicate weakened support for Harvard’s upcoming capital campaign.
“I would say that the economic downturn has had an effect of increased caution in the fundraising environment, and that would be true of our peers as well,” said Vice President for Alumni Affairs and Development Tamara E. Rogers ’74. “But while it has been a more challenging year thus far than last year, alumni continue to be tremendously loyal.”
Rogers declined to release any figures in an interview last week.
University President Drew G. Faust said last month that Harvard is currently soliciting feedback from its constituents for possible fundraising priorities and themes in preparation for a long-delayed capital campaign—a type of sustained fundraising drive that the University has not engaged in since 1999.
Faust added that highlighting certain themes that resonate with donors would be key to a successful campaign.
One prominent donor said that institutions like Harvard have a special staying power—unlike many non-profit organizations that have struggled this past year in raising funds—a factor that bodes well for a coming campaign.
“People love these institutions. They want to support them—they almost want an excuse to support them,” said Gifford Combs ’80, who has in the past solicited donations for the Harvard University Library. “You just have to have a story to tell them, and they’ll sign up.”
The precipitous $11 billion drop in Harvard’s endowment in the fiscal year ending 2009—and perceptions of financial of financial mismanagement—has not severely shaken the confidence of the University’s prominent donor base.
“The donor community that I know, they believe in Harvard—they’ve been up, and they’ve been down,” said John A. Armstrong ’56, who has endowed a professorship in engineering and applied sciences. “I think it’s highly unlikely that their commitment to Harvard has been affected.”
A tough economic climate may also present particularly wealthy donors with opportunities for giving. Low interest rates during a recession make an investment vehicle known as a charitable annuity trust particularly attractive because it allows donors to pass on money to their heirs and the University at low tax rates, according to one prominent donor who asked to remain anonymous to preserve his relationship with the University.
University fundraisers have encouraged this option as a means to support Harvard as well as secure retirement and lower tax burdens in their spring 2009 publication.
But Combs cautioned against overestimating donations and emphasized the importance of a strong message from the University as it seeks to bring in gifts in a weak economy.
“I think one should not underestimate the effect of the economy on donors,” he said. “No matter how much you may love your alma mater, the economy is the reality you have to deal with when you’re writing a check.”