(01-27-2015 02:17 PM)Viejobuho Wrote: Apparently, Rice spends more of its endowment revenue, proportionally, than the average peer school; so maybe, our total endowment ranking may not have improved much.
The recent drop in oil prices may adversely affect the next fiscal year's return, because Rice has some 12% of its endowment invested in "Natural Resources".
(01-27-2015 03:30 PM)temchugh Wrote: Universities typically spend 4.5% to 5% of the endowment each year (based on the beginning market value), so $233 M for Rice is right in line.
http://www.nacubo.org/Documents/Endowmen...gRates.pdf
I believe what I've heard President Leebron (PL) say is that Rice's dependence on endowment payout for operating expenses is greater than that of our peer institutions.
In his State of the University (SOU) address this past October, PL said preliminary FY 2014 expenses were $592 million. (See page 41 of the slide set here:
https://professor.rice.edu/uploadedFiles...0FINAL.pdf) The $233 million contribution from the endowment would then pay for 43 percent of those expenses. I don't have the time to try to look up comparable institutions but I don't doubt PL's statement.
BTW, the same page shows Rice's "3-year endowment spending rate: 5.45% (6/30/14) and 5.38% projected for FY 2015." As was discussed quite a bit during the recession, when the endowment's value contracted sharply, the BOT aims for a conservative endowment payout rate averaged over several years so there's a smooth, relatively constant funding stream for university operations.
In the 2009 SOU, the payout was nearly 6 percent -- $215.5 million of $3.6 billion -- which covered 46 percent of the $467.5 million in operating revenues (see pp 21 & 40 of that year's State of the University address, linked from here:
http://professor.rice.edu/professor/Speech_Index.asp). But that year's budget (p. 23 = expenditures?) was $479.1 million, and he said 2010 operating budgets would be cut by 5 percent.
In 2010 (
http://professor.rice.edu/uploadedFiles/...102110.pdf), expenditures were not given, but Rice's revenues were up to $489 million (+4.6%), of which 45% were said to have been from the endowment, which had a value of $3.787 billion. That amounts to a $220 million, or a 5.8 percent payout.