FAQs - About KU Endowment

Is KU Endowment a department of the university?
No. Although we work closely with university leaders, KU Endowment is an independent, nonprofit foundation.

How does the endowment help the state and the region?
During a time of decreased government support, KU Endowment has provided a vital margin of excellence to KU. From 2002-07, it provided $459.5 million in support for students, faculty, programs, research and capital projects. It has also responded by providing statewide support for outreach programs in areas such as the arts and public health, as well as training for firefighters.

More than two thirds of the buildings at KU were funded or furnished through private support from KU Endowment. Many serve not just students, but residents of Kansas and our region. They are located in Lawrence; Kansas City, Kan.; Wichita; and Overland Park. Some examples include the Hall Center for the Humanities, Regnier Hall, the Lied Center, the Dole Institute, the Booth Family Hall of Athletics, the Hoglund Brain Imaging Center and the Life Sciences Innovation Center.

Thanks to private gifts for professorships, KU is able to attract and retain nationally acclaimed faculty to teach and conduct research that transforms people's lives.

The State of Kansas supports KU. Why are gifts needed?
The state provides basic support, such as salaries, classrooms and other needs, but that amounts to only about 23 percent of the university’s budget. The remainder comes from tuition, fees, research grants and donations. Private gifts help us build a greater university than the state can by itself.

Who sets fundraising priorities?
The chancellor and other university officials set priorities in consultation with KU Endowment.

Who decides how gifts are used?
Donors decide. When you make a gift, you determine how it will be used. Some donors also give to the Greater KU Fund, which provides flexible, unrestricted support. This allows KU, at the direction of the chancellor, to apply the donations to the areas of greatest need or opportunity.

Why aren't endowment fund distributions used to lower tuition?
KU Endowment provides a margin of excellence for the university, but it does not replace funds coming from state appropriations and student tuition. It provides 9.2 percent of the university's budget. During the 2007-08 academic year, KU Endowment is providing more than $26 million in privately funded student scholarships, fellowships and awards, a 10.6 percent increase over the previous year. In that way, donors are already addressing the rising cost of tuition.

Do KU Alumni Association dues qualify as a gift to KU Endowment?
Standard dues do not qualify. However, donations given in addition to dues to support the KU Alumni Association do qualify as gifts to KU Endowment.

How does KU Endowment fund its operations?
We cover our operating expenses through a small number of unrestricted funds, as well as a portion of the return on our investments. One hundred percent of the principal of every gift goes to the university.

Are gifts to KU Endowment tax deductible?
Yes. Gifts are tax deductible under Section 170 (b) of the Internal Revenue Code and qualify for the maximum tax benefits available for charitable giving under federal income, estate and gift tax laws. After you have made a gift, you will receive a printed receipt.

How is the endowment payout rate determined?
Our payout rate is based upon an in-depth analysis of the capital markets and inflation. The overall goal is to increase the likelihood that we can achieve our investment and spending objectives, which are to preserve inflation-adjusted value of the principal while providing a stable and predictable source of support for KU year-in and year-out. Over the past decade, the payout rate has averaged 4.76 percent.

Why don't you provide a larger payout in years in which you have large returns?
We need to earn a great deal during bull markets to make up for inevitable economic downturns. Picking a few peak years out of a cycle is not a thoughtful approach. The long-term vitality of KU is one of KU Endowment's unwavering goals; therefore, a prudent payout rate is a responsible approach. We aim to provide a consistent level of support to the university in perpetuity.

What would be wrong with the federal government mandating higher payouts?
The proposed legislation represents an unprecedented interference from Washington that will harm an asset that has strengthened KU for 116 years. It is a "one size fits all" approach that fails to take into account the vast differences among higher education institutions with different needs, goals and cultures.

The proposed mandatory 5 percent payout increases the risk of overspending and eroding the purchasing power of the endowment. Moreover, this unnecessary governmental regulation will increase the administrative complexity of endowment management and create more volatility in spending distributions. Our goal is to preserve equity among generations, and this proposed legislation would harm our ability to accomplish this goal.

How does KU Endowment protect donor privacy?
We take your privacy seriously. Our Privacy Policy is available online for your review.

Why am I getting telephone calls from KU?
Student callers working for KU Endowment reach out to KU alumni and friends to build ties to the university, secure pledges and update our database. The calls also give you a chance to visit with a student and learn more about what is happening on campus.

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