Governor says UNC-system needs to raise more private donations

The state might be advising UNC-system schools to rely more on private donors, but administrators say money from those sources will not come close to covering their costs.

At a discussion on UNC-Wilmington’s campus Nov. 29, Gov. Bev Perdue said universities should focus on getting more private donations, primarily for research initiatives, to offset another year of inevitable cuts in state funding.

Officials say the intended destinations of private funding won’t be the areas that really need it — the ones hit hardest by the budget cuts.

The state traditionally funds employee salaries and other operation costs for universities, while private donors tend to give money to support special programs, such as the new Innovate@Carolina program and merit scholarships, said Bruce Carney, executive vice chancellor and provost at UNC-Chapel Hill.

“There’s a disconnect between where we are cutting basic services and what donors wish to support,” he said.

Innovate@Carolina aims to make UNC-CH a leading university in innovation and entrepreneurship by facilitating ways for students to share ideas and act on them.

“People in organizations and institutions like to give money to buildings and programs,” said UNC-system Board of Governors member John Davis.

“They don’t like to give money so that people can be paid a salary,” he said.

For the 2010 fiscal year, about 45 percent of private funding received went toward research, and about 29 percent went toward strategic initiatives such as the Innovate@Carolina program.

“Donors tend to see their gifts as providing a margin of excellence that helps keep us among the top universities,” said Elizabeth Dunn, senior associate vice chancellor for development at UNC-CH, in an e-mail.

“Private gifts augment our state appropriations but don’t replace them,” she said.

For the 2010 fiscal year, 12.3 percent of UNC-CH’s revenue came from gifts, private grants and investment income. About 21 percent came from state appropriations.

The University received more than $268 million in gifts during that fiscal year — down 1 percent from the previous fiscal year.

So far, UNC-CH has received 9 percent more gifts than at this point last year, Dunn said.

The University especially wants to raise funds for need-based scholarships, Dunn said.

The state has estimated 10 to 17 percent cuts for the coming year, Carney said.

These budget cuts will also be affecting need-based aid for the UNC system.

Legislators are considering a policy that would reduce state aid for UNC-CH students by as much as $2.6 million.

“Most of the budget goes to personnel, and most of the personnel are professors, and that’s where a lot of cuts will come,” Davis said.

Gov. Perdue is correct in asking UNC-system universities to raise more private funding, he said.

“There’s no question we’re going to have to do more fundraising in the private sector, but to ramp that up in this large amount will be extraordinarily difficult,” Davis said.

“I think it’s the biggest problem that I’ve faced since I’ve been on the Board of Governors.”

Contact the State & National Editor at stntdesk@unc.edu.