Peaks of Excellence: How Your Support Has Transformed IU
by Kenneth R.R. Gros Louis
Herman Wells once told me that during his presidency he did not actively engage in fundraising because he thought that was unethical. IU’s endowment, he would say, is the state appropriation; for IU to fundraise on a broad scale would put us in competition with Notre Dame, Evansville, DePauw, Hanover, and other fine private institutions of higher education in the state of Indiana. Each of these must have endowments to succeed.
Still, at the time of the University’s 100th birthday in the early 1920s, a fundraising effort took place to provide for three badly needed structures—the first unit of the Union building, Memorial Stadium (the one on 10th Street), and Memorial Hall, the first building of the Agnes Wells Quadrangle. Discussions about formalizing IU’s fundraising culminated in the charter of the Indiana University Foundation issued by the Indiana Secretary of State on June 15, 1936.
Prophetic Words
As Wells points out in his autobiography, during the first decade and a half of the Foundation, the limited funds raised were mostly from private gifts and were applied directly to faculty use, scholarships, loan funds, and the purchase of important collections for the libraries. A major leap forward in the affairs of the Foundation occurred because of the success of the 150th birthday fund drive in 1970. The goal for that campaign, announced on December 11, 1968, was $25 million; by its end, IU had raised over $51 million in cash, pledges, and bequests. The Bloomington campus still benefits from the income on these gifts. Obviously, expansion of fundraising efforts required an ever-larger staff at the Foundation.
Wells notes in Being Lucky, “The longer I live with the problems associated with the financing of the University, the more I realize that the peaks of excellence are provided typically by private money…. The state, within the limits of its means, out of tax revenues, attempts to provide for the basic necessities of the institution….”
Wells’ words have become prophetic in recent decades, as the percentage of the general fund budget for IU, especially in Bloomington (though still a large sum of money), has become smaller and smaller. Private giving has become more than something that allows additional activity at the University; rather, it is now essential to the enhancement of the institution, and its continued excellence. The General Assembly, faced in recent years with so many other pressures, has not been hostile to higher education; it simply has not been able to keep up with the needs of universities in the state. The basket of goods that comprises university expenditures is far different from the basket of goods typically used to determine annual cost of living increases. Laboratories, scientific equipment, new programs and schools, book and periodicals, infrastructure issues, greatly exceed the cost of living and have thus far surpassed the capabilities of the state to provide for what at one time were IU’s “basic necessities.”
The Culture of Giving
In the last 20 years, two capital campaigns aimed at growing endowments have been completed for IU and Bloomington, and a third one was formally announced on November 3, 2007, to end in 2010. There have also been highly successful campaigns for the medical school, IUPUI, and the regional campuses. It took a while for some alumni to be persuaded of the need to give to public research universities like IU because many assumed that funding was supplied by the individual states. As the percentage of institutions’ budgets from state funding decreased, however, in Indiana and elsewhere, the importance of private giving has become widely recognized and accepted. IU, especially Bloomington, would not be what it is in 2007-08 had the “culture of giving” not evolved. Certainly my years as chancellor would have been sad ones indeed without the support of many friends of the campus. As with any good story, the success resulting from private giving has many chapters.
The university-wide Campaign for Indiana (1985-89) had as its initial goal $203 million; the campaign closed having raised $316.1 million. Nearly one-half of the objectives focused on increasing endowments to support faculty, students, research centers, libraries, museums, new programs, instrumentation, and equipment.
It All Starts With People
What makes and sustains academic distinction? In my experience, we must have excellent students and excellent faculty. It’s more complicated to describe what these are than it may have been 20 or certainly 40 years ago. Greater diversity exists; there have been significant ethnic, cultural, economic shifts in the United States that have affected both students and faculty. And yet, I would propose that an excellent faculty member has strong intellectual curiosity, constant critical searching, is self motivated to probe facts and issues, but also has the ability and the energy to pull findings together to make them available to students and other professionals. No one is forced to teach full-time. And yet no student recruiting device, no matter how slick, is as effective over time as good teaching, for we tend to remember good teachers all of our lives. The support provided to the faculty in the Campaign for Indiana enabled the University to make significant strides in retaining our very best faculty.
What makes an excellent student? It has been my pleasure to work with hundreds of outstanding students: leaders of organizations, the Board of Aeons, Chancellor’s Scholars, Wells Scholars, others. They share similar characteristics. Inquisitiveness, certainly; like explorers, fine students seek what is beyond the horizon, on the other side of the sea or the river, out in space, inside us or our experiences; inventiveness and risk taking, a willingness to experiment, delighting, like adventurers, in finding out “what if?”, undaunted by rebuffs, dead ends, often inventing new ways. They share their ideas by speaking and writing in ways that are delightful to read and hear; they are intellectually bold and self-confident, believing in themselves, working with aggressive, but never arrogant, intellectual energy.
To Attract the Best
A challenge for me as chancellor, and for any administrator at a Research 1 institution, is to identify what attracts excellent faculty and excellent students. For students, the existence of a superior undergraduate education without regard to the quality of individual schools or departments may be enough, while for graduate students, the concern is much more likely to focus on the quality of individual schools and departments, even on individual faculty members with whom they might work. At both levels, I know, the availability of financial support is a critical factor.
For faculty members—and this was true during all my years in office—the nature of the overall environment is critical. Is there good support for research? For teaching? Does the institution offer incentives to improve and advance in both? Does it reward both? Does it provide challenging colleagues? For students and faculty the quality of resources matters: Are the laboratories up-to-date? Are the library collections reasonably complete? Are the facilities appropriate to the discipline or professional area? Is equipment current? Is computing access easy and powerful? Are there unique, hard to find strengths? Is there an academic community, or only a loose federation of intellectual interests?
I have discovered that attracting excellent faculty and students requires a universe of factors—no one thing by itself, but some combination of many things. A good research and teaching climate, the ease of doing research, flexibility in courses taught, such things attract excellent faculty. Good facilities, the quality of student life, course availability, curricular logic and flexibility, such things attract excellent students. Thus, a campus like Bloomington cannot move on only one front—a great library by itself, superior laboratories by themselves, will not lead to academic distinction. Similarly, a campus with one great school or two great departments is unlikely to achieve academic distinction because excellent faculty want to be with excellent faculty in other schools and departments, and good students want to be where other good students are. The Campaign for Indiana provided support for faculty, undergraduate scholarships and graduate fellowships, enhancements in research centers, libraries, and museums, and immediate funding for new programs and equipment. I began my tenure as chancellor as that campaign ended, and I saw what a difference the campaign made for IU, especially for Bloomington.
If You Build It
Faculty and students also want to have outstanding facilities. Another major objective of the Campaign for Indiana was to provide funding for the construction of priority buildings on different campuses. In some instances, the buildings were only partly funded during the campaign, but eventually they were built: the theater and drama center in Bloomington; the Neal Marshall Black Culture Center in Bloomington, the clinical science building at IUPUI, the new library at South Bend that led to a mall between it and the administration building that really enhanced the beauty and viability of the campus; the university center at Kokomo. For each of these facilities, the state provided some funds, but it was the additional funds raised in the Campaign for Indiana and later that led to their construction, and that construction is what faculty and students, without knowing the history of how they got there, will long remember as they think back on their IU educations, where they studied, where they played, where they worked. The memories of one generation are shaped by the new buildings it happens to inhabit; another generation’s memories may depend on buildings that did not exist when the prior generation was undertaking its studies. I have seen departments and schools in Bloomington energized by new facilities, attract stronger faculty and better students.
The Importance of Endowments
The Bloomington Endowment Campaign (1994-2000) had as its initial goal $350 million; when completed the campaign had raised over $504 million. As the name suggests, the focus of the campaign was on endowments for faculty and student support, especially faculty. Why? When the campaign began, IU was towards the bottom of the Big Ten in the number of endowed chairs. When the campaign ended, IU was first in the Big Ten, and by quite a margin, in the number of its endowed faculty positions. Five academic units had no endowed positions when the campaign began. When it ended, the five had a combined total of nearly two dozen positions.
Why do endowed faculty positions matter? Obviously, these positions provide honor and recognition for the faculty who hold them—indeed, appointment to a named chair or professorship is usually regarded as the most meaningful honor a university can bestow on an outstanding faculty member. These endowments also create a flexibility that enabled me, as an executive, to be “agile,” a word rarely associated with research universities. They also provide great flexibility to faculty who hold them. A good friend of mine, one of the world’s most distinguished logicians, was being wooed away from Bloomington by another fine university. He stayed at IU because we offered him an endowed chair, a chair that not only provided additional salary and research support, but also support for undergraduate and graduate student essay prizes, visiting lecturers, journals and books for the departmental reading room, even computers and software. What is striking to me is that an endowed position can benefit not only a single faculty member, but can provide for an entire department.
For students, endowments ensure a continual increase in the number of new undergraduate scholarships and graduate fellowships that the campus can award annually. Academic distinction is not built in a year or two. It requires long-term investments and commitment by key leaders inside and outside the university, by friends and alumni who give so generously to the endowment campaigns. And why are endowments important? It is because they provide stable, dependable sources of financial support for the University’s most valued teachers and researchers—either current faculty or those recruited. Similarly, they provide stable and dependable sources of financial support for outstanding undergraduate and graduate students. In that sense endowments are perpetual trusts. They are very much an insurance policy for continued excellence.
Stronger and Stronger
The characteristics of excellent faculty and excellent students I described above most assuredly fit those who receive endowed professorships and endowed scholarships or fellowships. These strengthen the campus not only by retaining our most valued resources, but also in attracting new talent to Bloomington that further enhances the campus’s reputation. They ensure that over time the campus gets stronger and stronger and as that happens, the character of the place is transformed in positive ways. From its inception, the Endowment Campaign was very much about people: outstanding faculty first, who in turn attract outstanding graduate students and undergraduates. They then create expectations from chairs and deans, yes, and chancellors, for enhanced equipment, technology, library resources, special programs. These, after all, are what deans, department chairs, and I were asked about by faculty candidates and prospective students. Buildings certainly are important to a great university, but it is the people who teach and learn in those buildings that make the difference between being average and being outstanding.
People are also the focus of the campaign for Bloomington now in progress, called Matching the Promise. A major focus of this campaign is on undergraduate scholarships and graduate fellowships. The name itself underlines the fact that for gifts of $50,000 or more, the campus will match the income on the gift in perpetuity, thus essentially doubling the value of the gift. A similar strategy was employed in the campaign that increased the number of endowed professorships—that is, the income on gifts was matched by the campus for all time. Clearly, this provides significant incentive to donors.
Keeping IU Affordable
The affordability of higher education has been a major topic of national interest in recent years. Last fall, a lengthy article in The New York Times pointed out how significantly public and private institutions raised their tuitions in recent decades. Bloomington has also been concerned about this issue, as tuition has increased substantially over the past 20 years. Hence, the focus on undergraduate scholarships and graduate fellowships.
This chapter of the story of private giving is the most stunning, I believe. On June 30, 2003, when the campaign began, the campus had approximately $150 million for scholarships and fellowships. By August 31 of 2007, the campus had, including gifts and the matches from the campus, $527 million. What did this mean for students from lower income Indiana families?
Students who came to Bloomington in the fall of 2004 from families with incomes of less than $50,000 had annual out of pocket expenses for tuition, room and board of $4,278 after scholarship aid was awarded to those eligible. Over four years, then, nearly $17,000, a figure that most families in that income group could probably not afford without taking on burdensome student loans. In the fall of 2007, because of the success to date of the Matching the Promise Campaign, the average cost, again for tuition, room and board for Indiana freshmen from families with incomes of less than $50,000, was fully met by scholarships; what remained was a cost per year of $341. That is an amazing story. And how many Indiana residents did this include in the freshman class of 2007? The number again is staggering: 1,100. Just three years ago, most of these students likely could not have afforded to come to Bloomington even though many of them were extremely talented; in the fall of 2007, there was no reason for any Indiana student who wanted to come to Bloomington not to do so because of finances.
Now, the campus is hoping to reduce the average cost for middle income Hoosiers—that is, families with incomes from $50,000 to $100,000. We have already reduced that cost by approximately $2,500 since the fall of 2004, but we have a way to go to equal the success of what has been done for Hoosiers from lower income families. This seems to me an extraordinary story and one that should receive national attention.
And More Remarkable Numbers
Has private giving made a difference? The University since 1985 has undertaken a university-wide campaign for Indiana, a Bloomington endowment campaign, a highly successful campaign at IUPUI, and is partway through the Matching the Promise campaign. For Bloomington alone, the funds raised in the past 20 years, from donors and friends and foundations and others who care about the campus, exceeds $1.5 billion. For the University as a whole, given the billion-dollar success of the IUPUI campaign, private giving has accounted for $2.5 billion-plus to support faculty, students, buildings, new programs, equipment, libraries, museums, all part of the quest to be better, to excel, to challenge our peers.
To put the importance of private giving in context, in the past 20 years the University’s operating budget has essentially doubled. So has the state’s appropriation. By contrast, private support has more than quadrupled, from $35.4 million in 1987 to $147.5 million in 2007.
Another measure is the University’s endowment, managed by the IU Foundation. Twenty years ago it stood at $189 million. Due partly to prudent investment, but also to substantial endowment gifts from private donors, the endowment in 2007 has grown to almost $1.6 billion—in spite of paying out roughly 5 percent a year for IU schools and programs. That means the endowment generates nearly $80 million annually, for programs all across the University. What an enormous boost private support gives us.
Thanks to You
Imagine what the Bloomington campus, indeed Indiana University, would be like without you. There would be fewer academic programs; fewer undergraduates with scholarships; fewer graduate students with fellowships; and only a handful of endowed professorships. The libraries, laboratories, and museums would be poorer; the facilities in many instances would be inadequate. In short, we would no longer be a major research university or one that serves statewide approximately 100,000 students per year. We would not have members of the national academies, Guggenheim recipients, Pulitzer Prize winners, large research grants, Rhodes Scholars, Marshall, Truman, and other prestigious student honors. Private giving has made all the difference.
Imagine what you would be like without the IU that you know, and imagine what IU would be like if it were not for your affection, devotion, and generosity to it. Years ago, Wells noted that private money provides for “peaks of excellence.” As he left his remarkable presidency, he wrote to the faculty, among other things, that it was time to move “onward.” And that the campus and University have indeed done, thanks to you. As we look to the future, what better challenge than to say, once again, “Onward!”
