UConn President Michael J. Hogan announced a new initiative called the Presidential Challenge program, on Feb. 2. The Presidential Challenge aims to raise $100 million in private funding for scholarships and graduate fellowships, which have lost some funding in light of the current economic crisis.
"Students and their families, like everyone else, are being hit hard by the current economic challenges," Hogan said in a university press release. "Given the important role of higher education in catalyzing economic development, we need to seek ways to protect their access to UConn, one of the nation's top public research universities."
This is the first time that UConn has sought out private endowments, said M. Dolan Evanovich, vice president for enrollment planning, management and institutional research. The average student at UConn will graduate with about $20,000 in debt, which is on par with the national average of $22,000, according to Evanovich.
"This is a long-term strategy," Evanovich said. It will take five to seven years to accomplish this goal, he said.
By partnering money from private donors with the existing $50 million that the university has set aside for scholarships, Hogan hopes to elicit more donors, and with that, help more students. This will be done with a matching of the payout (the interest) of the endowment funds, Evanovich said.
If someone were to donate $100,000, for example, the payout would be 4 percent annually. The principal amount ($100,000) stays in the account, and the interest ($4,000) would be paid out to the student. Then, the university would match this amount with another $4,000 for a total of $8,000, making the money go that much further for students.
"We could help two students instead of one, or four instead of two," Evanovich said.
Non-endowed gifts would be paid out immediately, with 50 cents on the dollar, making a donation of $100,000 increase to $150,000. Endowments are preferred, since they provide money in perpetuity, Evanovich said.
According to the university press release, endowments must be a minimum of $25,000, and non-endowments must be at least $10,000.
The money can be donated through the UConn Foundation, where the donor can choose the name of the scholarship and which school it will go to, said UConn spokesperson Karen Grava.
As of 2008, the cost of UConn undergraduate education is $18,638 annually for tuition, fees, room and board, Grava said. For an out-of-state undergrad, the annual cost is $33,350.
Scholarships are mostly annual, and will likely be available next fall, Grava said.
According to Evanovich, starting this program was in no way influenced by the possible increase in tuition for the 2009-2010 academic year.
There have been two donors thus far to the new program.
Doug Donaldson, a lass of 1973 alumnus and vice president of Subway Development Corporation of New England, is one of the first two donors so far to this new program. Donaldson donated $35,000 toward nursing scholarships. He is on the School of Nursing Advisory Board, according to a university press release.
"The matching funds from the University were the deciding factor in our decision," Donaldson said. "Given that the Presidential Challenge was available to make our money go further, we felt that now was the best time to make a gift that helps the School of Nursing, and may begin to address Connecticut's growing shortage of nurses," Donaldson said in the release.
Nursing students, for example, incur high fees for not only their books, but also tend to take an extra semester to graduate due to their clinical courses, Evanovich explained.
The other donor is a parent of a current UConn sophomore, and a chief executive officer of GE Retail Consumer finance according to the university press release. Margaret Keane, of Ridgefield donated her $25,000 bonus from GE, and added an additional $10,000 of her personal funds, for a $35,000 endowment.
"Students at UConn are really struggling financially in these very difficult times. I have always been a strong believer in public higher education," Keane said. "It was a simple decision to make. The President's Challenge match provides an even greater incentive to help deserving students complete their college studies."
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