Harvard Responds to Senators

Harvard and peer institutions release data detailing endowment payouts

Harvard released endowment and financial aid information this week in response to a U.S. Senate inquiry, while expressing hope that their cooperation would bring the investigation to a speedy conclusion.

The request for information—in the form of an 11-point questionnaire sent to 136 universities in January—comes as the latest step in an examination of university financial practices that has raised the specter of government regulation for endowment spending.

University President Drew G. Faust communicated her opposition to such legislative proposals in a letter prefacing Harvard’s reply.

According to Faust, the high standards of the nation’s most prestigious colleges have been maintained through “a careful balancing of the needs of the current generations of students against the preservation of sufficient resources for generations to come.”

Max S. Baucus and Charles E. Grassley, the chairman and ranking member of the Senate Finance Committee, requested the information late last month from the nation’s wealthiest schools by endowment size.

Harvard’s $34.9-billion endowment is the largest in the nation, though Princeton University—with $15.8 billion—has a larger endowment-per-student ratio.

In an interview last night, Kevin Casey, Harvard’s associate vice president for government, community, and public affairs, reiterated Faust’s words, expressing “hope that the committee has its view enhanced” by the responses.

“A hard line spend-out may not necessarily be the answer,” Casey said, referring to an across-the-board spending mandate. “It would be our hope that this information that [Grassley] is bringing in will lead to a different conclusion.”

Grassley has led the investigation into schools’ spending levels on financial aid.


Harvard told the senators in its response that 83 percent of the University’s endowment is restricted by terms attached to donor gifts, but a significant portion of its coffers—both restricted and unrestricted—can be used for financial aid.

Within the Faculty of Arts and Sciences (FAS), $2.4 billion is specifically earmarked for financial aid, and an additional $2.6 billion is unrestricted. The FAS Dean’s Discretionary Fund—another potential source for undergraduate aid—contains an additional $900 million.

In addition, at least some of the central administration endowment—valued at $3.4 billion in June 2006—has gone toward financial aid initiatives in the past, such as last December’s middle-income expansion.

Harvard’s answers to the questionnaire did not address restrictions for central administration dollars, attributing the omission to the senators’ focus on undergraduate financial aid.

University spokesman John D. Longbrake said that the endowment had “significant restrictions” but declined to elaborate further.

Princeton and Stanford Universities, which both posted responses to the questionnaire on their Web sites, reported endowments with a higher percentage of unrestricted funds—30 percent for Princeton and 25 percent for Stanford—than Harvard’s 17 percent.

Princeton and Stanford have the third and fourth largest university endowments respectively.

—Staff writer Clifford M. Marks can be reached at

—Staff writer Nathan C. Strauss can be reached at