Six months after joining Boston University as the development and alumni relations vice president, former Harvard Law Development and Alumni Affairs Associate Dean Scott Nichols says he is aligning fundraising efforts with the university’s long-term strategic policy, aiming to propel BU’s endowment past the billion-dollar mark.
BU’s current endowment is around $800 million. In comparison, Harvard University, well-known for its alumni contributions, has an endowment closer to $30 billion and an operating budget of less than $3 billion. According to Nichols, strengthening the endowment is now one of the university’s highest priorities.
“Increasing the endowment is a constant and widespread goal,” he said in an email. “Many offices share a commitment to growing the endowment, especially the financial offices through investment strategy and the development offices through increased fundraising.
“President [Robert] Brown launched a long-range strategic planning process last year that is determining what the priorities for the next decade and beyond should be,” he continued.
Increasing the endowment through fundraising is one of the key goals for the near future, Nichols said. By next spring, the Strategic Planning Task Force hopes to produce an initial draft plan based on input received from the entire BU community.
Because the university only draws money from the annual interest produced by the $800 million principal, Nichols said the most important aspect of the endowment is not the amount of money, but the quality of the investments that are placed.
BU had an endowment of $18.8 million when president emeritus John Silber took office in 1971. During his time as president, he increased the university’s endowment to $100 million in the late 1980s and to $200 million in the early 1990s, BU spokesman Colin Riley said.
Almost half of BU’s current operating $1.5 billion budget comes from students’ tuition. With an endowment, Riley said, institutions typically use only the annual interest, without lowering the increasing principal.
Not all the money BU receives from donors is added to the endowment fund. Fundraising initiatives support academic programs and building renovations as well. If a contributor wants to donate money for a specific purpose, the university may add that donation directly to the operating budget.
“Critically important support is sought for the operating budget,” Nichols said. “These dollars help keep tuition increases down and provide crucial monies for all those things that keep the budget balances, such as salaries, utilities, maintenance, the libraries, student services, etc.”