Five historically Black colleges and universities in Georgia will benefit from a new endowment fund fueled by a $100 million grant announced Thursday by the United Negro College Fund.
The donation from Lilly Endowment Inc. is the largest unrestricted private grant in the UNCF’s 80-year history. With this gift, the UNCF has raised $550 million toward a $1 billion capital campaign that began with a silent phase in 2020.
The UNCF plans to use the $100 million grant to create a pooled endowment fund that it wants to grow to $370 million through additional fundraising. The organization will manage the endowment, whose investment earnings will be shared equally by its 37 member schools. Those include four private HBCUs in Atlanta — Clark Atlanta University, the Interdenominational Theological Center, Morehouse and Spelman colleges — and Paine College in Augusta.
“We believe that one of the big challenges that HBCUs face is that they are under-resourced in terms of endowment,” said Michael L. Lomax, the UNCF’s president and CEO, in a phone interview with The Atlanta Journal-Constitution. He added: “We think that in order to make our institutions stronger and more competitive over the long term, we want to work to grow their assets.”
Starting in March of next year, UNCF will make annual payouts from the endowment earnings that the schools can use as they wish, on anything from faculty salaries to scholarships. Lomax said the aim is to eventually provide about $1 million a year in unrestricted funding to each school through that and other support from the organization.
Pooling the endowment allows for more investment opportunities in a variety of stocks, bonds and real estate that could yield higher returns, according to the UNCF. Sharing the resource also will promote networking and partnering among the schools.
“Working together has been proven to be a pretty winning formula,” Lomax said.
Credit: Olivia Bowdoin for the AJC
Credit: Olivia Bowdoin for the AJC
The median endowment for UNCF’s member schools is $15.9 million; once the UNCF completes its fundraising goal, the median goal will jump to $25.9 million, according to the organization. The median endowment for private non-HBCU schools is more than $200 million, Lomax said.
“It doesn’t close the gap with their non-HBCU peers, but I think it does begin to call attention to one of the areas where American philanthropy can make a difference,” he said.
The Georgia schools that are UNCF members have endowments that range from $5.9 million at Interdenominational Theological Center to Spelman College’s $570 million, according to 2021 numbers provided by UNCF through the National Center for Education Statistics.
Officials gathered Thursday at Clark Atlanta to mark the grant. George T. French Jr., the university’s president, called the announcement “a major accomplishment” and said it “will provide unprecedented support for the financial stability and continued success of UNCF’s member institutions.”
Here are some recent major donations and gifts to some of Georgia’s private HBCUs
May 2019: Billionaire investor Robert F. Smith agreed to pay the student loan debt for Morehouse College’s entire graduating class. The gift totaled $34 million.
June 2020: Netflix executive chairman Reed Hastings and his wife, Patty Quillin, gave $120 million combined to the UNCF, Morehouse and Spelman colleges.
July 2020: Philanthropist MacKenzie Scott gave $20 million each to Morehouse and Spelman. Scott made a $15 million donation in December 2020 to Clark Atlanta University.
September 2020: Bloomberg Philanthropies announced a $26.3 million gift to Morehouse School of Medicine.
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