Stanford hopes to close financial-aid deficit in four to five years, Hennessy tells Stanford faculty
University President John Hennessy highlighted the endowment’s recovery at Thursday’s Faculty Senate meeting, which also saw a detailed overview of undergraduate admission and financial aid two years into a financial aid overhaul that pressured University finances but erased tuition for hundreds of students’ families.
The endowment’s growth to $13.8 billion this year marked a turnaround from the $4.6 billion drop to $12.6 billion last year, the largest single-year fall in the University’s history. “We’re beginning to see some greater stability,” Hennessy said. “It’s a long way back to where we once were.”
He repeated Stanford Management Company’s comparison between the 10-year performances of Stanford’s principal investments, with a return of 6.9 percent, and the U.S. equity market, which declined over the decade.
“I think it still shows the advantage of a highly diversified portfolio, although in the financial crisis of the last few years, no portfolio was completely safe,” Hennessy said.
“I think going forward, we hope to be able to continue to deliver good returns while ensuring that the endowment can meet its obligation payout to the University,” he added.
Heading into the final year of the Stanford Challenge, a five-year, multi-billion dollar fundraising campaign, Hennessy said the University has seen a “significant” jump in annual giving. It is helping close the deficit in undergraduate financial aid, which Stanford hopes to seal in four to five years, the president said. Alumni must understand the importance of that support when they consider giving, he added.
The endowment payout funds more than $60 million of the financial aid budget this year. The remainder of the $100 million-plus budget is covered by the Stanford Fund, general funds, the Tier II buffer and other sources. Slightly fewer students are receiving financial aid this year than last.
Hennessy’s remarks came after a campus-wide earthquake drill Thursday morning. “I think we discovered that we still have a lot of work to do,” Hennessy said about the community’s readiness. A major earthquake in California is a matter of “when,” not “if,” added law Prof. Hank Greely.
Shaw Talks Test-Score Trends, Recaps Aid
Dean of Undergraduate Admission and Financial Aid Richard Shaw last made a formal report to the faculty two and a half years ago, just as Stanford made a major commitment to more financial aid. On Thursday, he recapped those changes and provided a detailed glimpse at the undergraduate demographic.
The $15.5 million financial aid boost of 2008-2009, which erased parent contributions for families making less than $60,000 and tuition for families making less than $100,000, has helped protect families’ home equity, cost-of-living adjustments and responsibilities to multiple children in college as the economy flagged, Shaw said.
In fiscal year 2010, more freshmen with families making between $100,000 and $200,000 received financial aid, he added. The number of freshmen getting aid in that range dropped back in FY11.
Trends in the entering class include a drop since 2003 in the number of students reporting their class ranks — a “Lake Wobegon effect,” Shaw said. Forty-one percent of the Class of 2014 reported their class ranks to Stanford, compared to 83 percent in 2003.
Median verbal SAT scores for the entering class have hovered between 710 and 730 in the past decade, landing this fall at 720. The median math score this fall was 740 — on the high end for the decade — and the median writing score was 730, the highest it has been since that section’s introduction in 2006.
Shaw turned to other universities, telling faculty 26 percent of students admitted to the Class of 2014 also were admitted to UC-Berkeley; 21 percent to UC-Los Angeles; 18 percent to Princeton; 17 percent to Harvard; 15 percent to Yale; 13 percent to UC-San Diego; 14 percent to Duke; and 13 percent to M.I.T.
Of the ’14 admits who did not enroll at Stanford, 32 percent chose Harvard; 16 percent, Yale; 14 percent, Princeton; and 13 percent, M.I.T. UC-Berkeley was not among the top 20 schools those students chose.
At 71.6 percent of 2,340 admits, yield this spring was the highest since at least 1954. Shaw attributed that, at least in part, to connections alumni made with applicants who participated in the pilot alumni-interview program in several U.S. cities last year. The Committee on Undergraduate Admission and Financial Aid found a “very small effect” of the interviews on evaluations of Stanford hopefuls, and will decide the future of the three-year pilot after its wrap-up this year.
Up Next: Libraries, SUES, ROTC
David Spiegel, psychiatry professor and 35-year faculty member, appeared as the new chairman of the Faculty Senate on Thursday. “I should warn you as a psychiatrist that I have never before undertaken group therapy on such a massive scale,” he joked.
The Senate now looks to an Oct. 21 report on the future of Stanford’s libraries, which earlier this year affirmed their support of a massive book-scanning partnership with Google Book Search. On Nov. 4, professors Sue McConnell and James Campbell Ph.D. ’89 are due to deliver an update on the Study of Undergraduate Education at Stanford (SUES), a major review of undergrad curriculum.
When the ad hoc committee on ROTC will report to the faculty is unclear. When U.S. Senate Republicans blocked debate on a proposed repeal of the “don’t ask, don’t tell” policy last month — a repeal expected when the ad hoc committee formed in March — the timing and likely outcome of a decision at Stanford were thrown into doubt. But the committee is meeting, Spiegel told The Daily, and he is “sure they’ll report sometime this year.”
Rex Jamison, academic secretary to the University, promised: “There won’t be any dragging.”