The unquenched thirst of colleges and universities
Much of the commentary about the college admissions scandal that topped the headlines recently is that this is nothing more than "business as usual." Was Jared Kushner's admission to Harvard based on his merits, or the merits of a $2.5 million gift from his father? Did George W. Bush get into Yale based on grades and test scores, or on the strength of his family name?
Yale University is one of the colleges and universities where students were admitted based on applicants being identified as athletes who were no such thing. A former soccer coach there accepted bribes to allow applicants who were not soccer players to be designated as recruited athletes.
Money is important to Yale as well as the people who took bribes to "help" applicants. Look at their three most recent Forms 990 (tax return of a "non-profit") Their net surplus/deficits for those three years were:
2015 - $1.95 billion
2016 - $1.13 billion
2017 - $774 million
Much of those surpluses come from the huge endowment of Yale University, which according to U. S. News and World Reports stood at $27.2 billion at the end of fiscal year 2017. The highest paid employee that year at Yale was David Swensen, the university's Chief Investment Officer. In addition to his base salary of $844,579, he received a performance bonus of $2,974,672 and other benefits/pay that brought his total compensation to a staggering $4,683,382.
Private education depends on more than tuition to thrive. A certain Los Angeles "Westside" private school that will remain nameless got 25% of its total revenues of $62.9 million for the fiscal year that ended 6/30/2017. BTW, they had a surplus of $12.2 million for that year.
To do the cutting edge research, hire the best educators and so on is not cheap. The need to raise money for such institutions is never-ending. USC had one of the smaller endowments among leading private universities. So in 2011 they launched an ambitious plan to raise $6 billion in additional endowment. They achieved their goal 17 months ahead of schedule.
This is one of the factors that has been instrumental over the long-standing tradition of the well-heeled being able to "buy" admission for their offspring through contributions. California Governor Gavin Newsom called people contributing enough money to put their name on a building "legal bribery" and in a Los Angeles Times story said, "Do you think, seriously, does anyone think someone who writes a $100 million check to a university doesn't have a cellphone of someone who's influential?"
He is correct of course. But there is another issue here. Private means private. A private university, as long as they are not discriminating in violation of the law, can choose who to admit and who to reject. Legacy admissions, sibling priority and all of those things are in fact legal.
* * *
But that doesn't excuse those who paid outright bribes to cheat the process by claiming their offspring were something they were not. Who paid to facilitate cheating on SAT tests. Who claimed a tax deduction for a contribution to a charity that was actually payment for entrance through Rick Singer's "side door."
Speculation is that those parents who are accused will cut deals to avoid jail time.
Stay tuned.
Yale University is one of the colleges and universities where students were admitted based on applicants being identified as athletes who were no such thing. A former soccer coach there accepted bribes to allow applicants who were not soccer players to be designated as recruited athletes.
Money is important to Yale as well as the people who took bribes to "help" applicants. Look at their three most recent Forms 990 (tax return of a "non-profit") Their net surplus/deficits for those three years were:
2015 - $1.95 billion
2016 - $1.13 billion
2017 - $774 million
Much of those surpluses come from the huge endowment of Yale University, which according to U. S. News and World Reports stood at $27.2 billion at the end of fiscal year 2017. The highest paid employee that year at Yale was David Swensen, the university's Chief Investment Officer. In addition to his base salary of $844,579, he received a performance bonus of $2,974,672 and other benefits/pay that brought his total compensation to a staggering $4,683,382.
Private education depends on more than tuition to thrive. A certain Los Angeles "Westside" private school that will remain nameless got 25% of its total revenues of $62.9 million for the fiscal year that ended 6/30/2017. BTW, they had a surplus of $12.2 million for that year.
To do the cutting edge research, hire the best educators and so on is not cheap. The need to raise money for such institutions is never-ending. USC had one of the smaller endowments among leading private universities. So in 2011 they launched an ambitious plan to raise $6 billion in additional endowment. They achieved their goal 17 months ahead of schedule.
This is one of the factors that has been instrumental over the long-standing tradition of the well-heeled being able to "buy" admission for their offspring through contributions. California Governor Gavin Newsom called people contributing enough money to put their name on a building "legal bribery" and in a Los Angeles Times story said, "Do you think, seriously, does anyone think someone who writes a $100 million check to a university doesn't have a cellphone of someone who's influential?"
He is correct of course. But there is another issue here. Private means private. A private university, as long as they are not discriminating in violation of the law, can choose who to admit and who to reject. Legacy admissions, sibling priority and all of those things are in fact legal.
* * *
But that doesn't excuse those who paid outright bribes to cheat the process by claiming their offspring were something they were not. Who paid to facilitate cheating on SAT tests. Who claimed a tax deduction for a contribution to a charity that was actually payment for entrance through Rick Singer's "side door."
Speculation is that those parents who are accused will cut deals to avoid jail time.
Stay tuned.
posted by me at 5:17 PM
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