Middlebury’s endowment grew by about 37.4% — or $398.3 million — from the previous fiscal year, said Executive Vice President for Finance and Administration David Provost in an email to the Middlebury community on Oct. 25.
Due to the fiscal uncertainty created by the Covid-19 pandemic due to things such as lost tuition, program cancellations and necessary investments in things like personal protective equipment, the administration predicted that Middlebury would experience financial hardship. However, Provost said the endowment’s growth from $1.1 billion to $1.5 billion and the college’s overall budget deficit of only $11.9 million compared to the projected $18.5 million deficit are positive steps.
“These losses posed significant challenges to our operations, our instruction, and to our desire to maintain wage and benefit continuity to all our employees,” Provost said. “Nevertheless, we were able to minimize their impact.”
This increased revenue comes after the college took controversial measures in previous years to try to create economic stability. The college increased tuition for the 2020–21 academic year by 3% despite the financial hardships faced by families because of the Covid-19 pandemic, sparking criticism from parents and students. In addition, last year, the Board of Trustees instructed the college to raise tuition again, limit the endowment draw to 5% and begin making principal payments on the school’s debts.
Middlebury was not alone in seeing significant growth this past fiscal year. Williams College saw a 49.9% increase in their endowment, Bowdoin College saw a 57.4% increase in their endowment and Princeton University saw a 46.9% increase in their endowment.
Provost attributed the fiscal success to a number of steps taken by the college. For the endowment, most of the growth comes from investments in private equity; Investure, a firm based in Charlottesville, Va., is responsible for managing Middlebury’s assets. For the school budget, federal reimbursements, reductions in overall spending and a hiring freeze were able to offset some of the lost revenue created by the pandemic.
The college has not announced specific plans for the increased endowment but said in the email that they plan on using it to achieve their goal of financial sustainability and to invest in things like financial aid, instructional support and student services support.
“As we look ahead, we must be thoughtful and deliberate about our immediate next steps with respect to these significant and unforeseen gains,” Provost said in the announcement. “Given previous years of deficit spending, and higher-than-average endowment spending, we are not making any announcements regarding how we might spend any gains and will instead spend the next year strategizing on a way forward through conversations with our faculty, staff, and student stakeholders, and with our financial advisors and trustees.”