PROVIDENCE, R.I. (WPRI) – The value of Brown University’s endowment has hit a record high of $3.5 billion following what its president says was a year of “excellent financial results” for the Ivy League institution.
Brown President Christina Paxson detailed the school’s performance in its 2016-17 financial report, which was sent to alumni this week. The school’s endowment rose 13.4% during the fiscal year, which ended June 30. Its operations were also well in the black, posting $20 million in net income.
“Operational excellence and enduring financial security are the bedrocks for Brown’s vision to achieve new levels of leadership as a renowned institution of higher education,” Paxson, who is starting her second five-year term leading the school, wrote in the report.
Brown’s financial health has important ramifications for the broader Rhode Island economy. The school plays an increasingly visible role in economic development, including as a partner in the much-touted Wexford innovation campus on the old 195 land, and it is a major employer.
Investment income from the endowment – begun in 1769 with a donation of $4,500 – contributes nearly one in five dollars for Brown’s nearly $900-million operating budget. The school says it’s in the process of trying to reduce how much of the endowment is spent annually in order to preserve its value for future generations.
The endowment is facing another threat at the moment: a provision in the tax reform bill GOP leaders are moving through Congress would levy a tax on the nation’s largest college endowments. Richard Locke, Brown’s provost, told the student newspaper the measure could cost the university roughly $3 million to $6 million a year if it becomes law.
Brown has been plowing money into its medical and science programs in recent years, and the financial report describes 2016-17 as “nothing short of transformative” for the school in those areas. Its research budget has jumped by $20 million over the last four years, to $57 million, and the school argues it is “ascending to leadership” in life sciences.
Brown’s biggest research awards in the last year include a grant of $19 million to create the Advance Clinical and Translational Research (Advance-CTR) center, described as a collaboration with local medical groups “to design, conduct and analyze medical studies, including treatment trials, that build on basic research.”
Brown is currently undertaking a capital campaign, BrownTogether, that aims to raise $3 billion to fund financial aid, research and new programs. Paxson said she expects donations to the campaign to total $1.5 billion by late fall after what the school says was “a record-breaking year in many respects for fundraising.”