Sources of Funding

File this under “sounds good until you look under the hood,” but a massive donation with very clearly-attached strings is causing turmoil at one school.

The donation is the largest in the private, Catholic institution’s history, and many say the resulting research center investments have the potential to considerably raise the institution’s profile in the region and nationally. The contention, however, stems from shifting donor expectations of their influence in decisions related to their gifts, something today’s cash-strapped colleges are reconsidering.

The problems with this are clear: schools need money, especially small private schools (not to mention public schools). So they raise tuition and/or accept such gifts. And it’s hard to say no to funds when you need them. You end up with funding streams that are designed to shift the school itself. And until we break out of our cycle where schools – of all types – are underfunded, this will probably continue. Except…

Massive donations could be on the decline, however, with the latest tax bill making fewer taxpayers eligible for tax-deductible contributions through a higher standard deduction, Bloomberg reported. Some wealthy donors may be less likely to donate part of their estate because estate-tax regulations have been loosened.


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