Capital campaign increases revenue, boosts endowment

The first Campaign Georgia Tech Atlanta “Roll Out” Event in Atlanta was held in collaboration with The Georgia Tech Foundation Inc. on Wednesday, March 2 at the Coca-Cola Company headquarters.
The event was held to kick off the Atlanta leg of the Campaign Georgia Tech “Roll Out” tour that Institute President G.P. “Bud” Peterson and others are leading throughout various areas of the country to garner financial support from alumni. The Georgia Tech Foundation is a not-for-profit, tax-exempt 501 (c)(3)corporation that receives, administers and invests private contributions made in support of the academics at the Institute.
Financial donations have suffered greatly over the past few years in response to the financial crisis seen across the country. As bond markets and other financial safety nets began to collapse, universities suffered from an increasingly large lack of donations.
“We first caught wind of the recession in June 2008,” said Barrett Carson, vice president of Development. “It was the most precipitous drop in philanthropy we have ever seen. The preceding May was the best month we had ever seen, and in June, we dropped to rock bottom.”
Fortunately, however, the impact on financial gifts received by Tech was almost negligible. Despite the fact that the tax write-offs were very miniscule, benefactors paid almost all of their pledged donations. In order to maintain the same rate of response, Tech administration chose to change their approach in donor relations.
“We stopped pressuring alumni for multi-year pledges,” Carson said. “Our focus instead became stewardship. We forged closer relationships with our donors, and we continued to actively meet with donors and faculty to keep the lines of communication open.”
This is a radically different model compared to other universities, especially as states such as Mich. discuss the possibility of removing the income tax deductions from donations to public universities. In fact, Tech is close to a complete and full recovery.
“We are extremely close to being back at the pre-recession levels we saw in 2008,” said John Carter, president and chief operating officer of GT Foundation. “We have about $1.3 billion in active assets, and we have seen a most remarkable recovery.”
The event began with a speech from John Brock, chairman and CEO of Coca-Cola Enterprises Inc., who was announced publicly on campus as the Campaign Chair of Campaign Georgia Tech last Sept.
Brock discussed the opportunities that philanthropic donations create, such as the 3000 undergraduate scholarships that exist currently on campus because of donations.
According to Brock, around one in eight faculty chair positions are endowed. It is a goal of the campaign to double that proportion in order to endow every one in four positions. Continuous donations from alumni will help such policies.
While discussing the active role that philanthropy has played in the history of the Institute, Brock referenced the single largest donor to Tech, Mrs. Letty Pate Whitehead Evans, for whom the Tech Tower building is named. Evans was appointed to the Board of Directors of the Coca-Cola Company in 1934 and was one of the first females to serve on the board of directors for any American corporation. Evans’ estate has contributed millions to Tech each year and continues to contribute around $7 million annually.
“It is because of people like Letty Pate Whitehead Evans that Tech has the reputation that it does today,” Brock said. “Philanthropy has been a part of the fabric of Tech for its 126 years in existence. We must continue the tradition.”
The tradition of donation and alumni support was heavily emphasized throughout the evening, especially by Peterson.
Peterson discussed the strategic plan for the next 25 years, which was one of the very first initiatives of the campaign. Peterson worked closely with Alfred P. West, who was Campaign Chair during the quiet phase, to establish a strong financial foundation for the campaign. Before being announced to the public, West had managed to generate fundraising totals reaching more than $900 million. However, the current philanthropic projections greatly exceed that.
“This campaign is intended to raise $1.5 billion by Dec. 21, 2015, the most aggressive campaign we have ever undertaken on this campus,” Peterson said. “In order to achieve our goal, we have to raise around $2.3 million a week. This will present some challenges, but I am confident that we can achieve that.”
According to Peterson, costs are only rising. Ninety percent of the tuition today is more than 100 percent of the tuition from two years ago. In order to exceed that, only an 11 percent increase would be needed and tuition increased 16 percent last year alone. The campaign has raised just under $1 billion in an effort to generate funds to help address the rising costs of school.
Professor of the Practice of Finance Gary Jones emphasized to all in attendance that any donation, at any size, would be appreciated and helpful.
“We’ve had donations from $5 to $50 billion,” Jones said. “A lot of students donate in $5 increments through the Student Foundation, and we received our largest donation of $50 billion a few weeks ago.”
According to Peterson, Collaboration between the Alumni Association, which raises donations through Roll Call, the Georgia Tech Foundation and the Office of Development is paramount in order to achieve short- and long-term donation goals.