ACE has released an updated version of Understanding
College and University Endowments, a brief that examines how these
funds support an institution's educational mission, enhance access, and bolster
innovation.The paper—as well as its complementary summary
document—addresses frequently asked questions about endowments and explains
how they are created and managed, as well as how they have changed in recent
years.
Data from the 2023
NACUBO-Commonfund Study of Endowments and past reports
from the National Association of College and University Business Officers
(NACUBO) were instrumental in revising the paper, which found that 66 percent
of endowment spending in FY 2023 was on student financial aid and academic
programs.
“At colleges and universities, endowments make a tangible
impact on students, faculty, and campuses in myriad ways to support the aims of
the institution,” the paper reads. “While college and university endowments
differ in size, structure, and organization, their broad purposes—to advance an
institution’s charitable mission to expand and enhance educational and research
opportunities and programming that benefit the public good—are uniform.”
The new paper comes as Congress is preparing for a
significant tax reform effort in 2025. Last week, ACE and a coalition of higher education
associations submitted
comments to the Republican Tax Teams of the House Ways and Means Committee
emphasizing the importance of tax reforms that would benefit students and
institutions, including the repeal or reform of the excise tax on investment
income of private colleges and universities.
To download the paper, click
here.