The endowment is a perpetual asset of the University—just as its buildings and land are assets—that provides the ability to offer an extraordinary education to our students. Every alumnus of the University received support from the endowment during his or her time as a student, even if he or she did not receive financial aid. The endowment thus represents the legacy to the present—a result of the past generosity of the University’s supporters.
As a private institution, Rochester is sustained by its own independent sources of funding rather than relying on the support of taxpayers, as is the case with public universities.
The endowment is a source of income, with the specific purposes of that income decided by donors. Donors frequently specify a particular purpose for gifts, creating endowments to fund professorships, teaching, research, lectureships, scholarships, fellowships, prizes, maintenance or general educational support.
Although distinct in purpose or restriction, endowment funds are commingled in an investment pool and tracked with unit accounting much like a large mutual fund.
The support provided by endowments of universities like Harvard, Yale or the University of Texas, which are valued in the tens of billions of dollars, is very substantially above that provided by Rochester’s endowment. While Rochester is fortunate to be among endowments valued above $1 billion, continued growth in endowment through gifts is essential to continuing the high quality of a Rochester education, which is among the best offered by our nation’s leading universities.
An endowment fund must maintain equity across generations. Its value cannot, by law, be disproportionately expended on current needs. In order to assure generational equity is managed properly, Rochester’s Board of Trustees establishes and oversees an endowment spending formula that balances today’s needs against future need.