The Society of Alumni, gift-giving and the endowment: how it works at Williams

Recent inquiries about the College’s endowment and investments have prompted questions regarding how Williams raises money from alumni and how the gifts are channeled. Hopefully, this article will explain and clarify the fundraising process at Williams.

The Society of Alumni, which presently handles gifts to the College, was founded in 1821 by Emory Washburn, class of 1817. The Williams Society of Alumni also holds status as the oldest college alumni association in North America. The founding of the Society was a reaction to President Zephaniah Swift Moore abandoning Williams to found Amherst College.

The Society of Alumni presently boasts approximately 21,500 active members. Alumni can choose to give to the College through three channels: the Alumni Fund, capital campaigns and planned giving programs.

Those who give to the Alumni Fund can give as much or as little as they decide. Alumni Fund gifts are used for the operation of the College, or, as stated in the Alumni Society Constitution, “devoted to such general College purposes as the President and Trustees of Williams College shall determine.”

The Society of Alumni webpage explains, “the Alumni Fund provides immediately expendable income that is used during each fiscal year to support the core programs of the College – students, faculty, financial aid and academic and residential facilities.”

The source also notes that the Alumni Fund is indispensable for the operation of undergraduate education at Williams: “True cost of a Williams education: Tuition, room, board and student fees continue to cover less that half the College’s actual expenditures per student.”

Last year, the Alumni Fund raised $5.6 million, over 10 percent more than its goal of $5.1 million. Participation levels were at 57.6 percent. This year’s goals are to raise $5.9 million and enjoy participation levels of 60 percent. The Society of Alumni webpage notes that rival Amherst claims a 65 percent participation rate, and notes, “This is a factor in Amherst’s continuing its number one ranking among national small colleges in U.S. News and World Report, while Williams remains third.” So far this year, participation is at 8.25 percent, and the Society has raised $1.23 million. Most of the fiscal year is still in the future, but alumni must have their donations in by mid-February to be counted in this year’s class participation figures for giving.

Another concern of the Society of Alumni is encouraging alumni to donate unrestricted gifts, a qualification for donating to the Alumni Fund. The webpage notes that “the most valuable gift to Williams is an unrestricted gift. Unrestricted gifts allow the College the flexibility to use resources where they are most needed. These gifts go to work immediately to support students, faculty and the academic and residential facilities that are inherently a part of the Williams experience.”

Without the Alumni Fund, the Society estimates, an increase of $2,500 per student would be required to sustain current operation levels on campus. As it stands, the Alumni Fund defrays six percent of the College’s operating budget. Within the category of operating funds is financial aid: operating funds support 60 percent of the financial aid program.

Restricted gifts to the College are considered capital gifts. They may be restricted for a particular sector of the College, such as general athletics, an athletic team, an initiative, a building project or the endowment. As the Society of Alumni page states, “Gifts to the endowment exist in perpetuity and provide security for the College for the future, as well as generate income for current use.” Interestingly, if an alumnus donates a restricted gift alone, the donor is not counted in the participation tally.

Williams spends between $10 million and $20 million per year to maintain the buildings and grounds of the campus. The construction of the new Science Complex, the renovation of Goodrich Hall and the plans for the Performing Arts Center are all considered capital projects.

The relationship that the Society of Alumni and monetary gifts have with the endowment is through the capital gifts category. Donors can ensure that their gifts will be added to the endowment, which exists in stockholdings and investments. The College takes out a percentage of the endowment each year – approximately four percent – which, after adjusting for inflation, is slightly lower than the annual growth of the investments. Thus, the endowment stays stable or increases slightly each year. Of course, fluctuations of the stock market influence the actual endowment. The endowment of the College began as the life savings of Colonel Ephraim Williams: $9157. This summer,the stock market pushed the holdings over the $1 billion mark for the first time in Williams history. Now, however, the estimates are just below the $1 billion threshold.

Lastly, planned giving is concerned with gifts of personal property and life income plans. Hopkins Forest, for instance, was a planned gift; the President’s House, once a private residence, was also a gift to the College.

The Executive Committee of the Society of Alumni consists of 18 elected alumni, with a turnover of six each year. The Executive Committee also includes the Alumni Society president, vice president, secretary, assistant secretaries and the ex officio treasurer, as well as five Alumni Trustees and the officers of the Alumni Fund. The Williams Alumni Relations Staff, located in Mears House, works with the Executive Committee to help maintain alumni links.

This article was compiled from information available through the Society of Alumni’s official webpage: http://www.williams.edu/admin-depts/alumni/relations/alumsoc.html, in addition to The Purple Connection by Philip H. Warren, Jr. ’38.

’38.

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