AUBURN UNIVERSITY FOUNDATION AND COMPREHENSIVE CAMPAIGN BRIEFING Faculty Senate September 17, 2013 Auburn University Foundation Auburn University Foundation: A non-governmental, non-profit organization separate and distinct from Auburn University [separate 501(c)(3)] Purpose: Receive charitable contributions for the benefit of AU and AUM Assure donations are kept separate from state funds Auburn University Foundation Manage AU, AUF, AAA, TUF endowments. AUF investment objective: To earn a total return (net of portfolio management fees) within prudent levels of risk, which is sufficient to maintain in real terms the purchasing power of the endowment’s assets and support the defined spending policy. Auburn University Foundation Auburn University Foundation Board Consists of 24 voting directors who serve four-year terms 3 Ex officio, non-voting members: AU President AUM Chancellor Auburn Alumni Association President AU/AUF Endowment | Update thru 7/31/13 Combined Market Value (12/31/2012): $488,247,605 2012-13 Distribution to the University: 2012 Endowment Performance: $17,229,000 9.9% Endowment Annualized Returns: One-year Three-year Five-year 13.6% 8.8% 4.3% Combined Market Value (07/31/2013): $524,962,719 2013 Endowment Performance (through 7/31): 7.7% 2013 Endowment Distribution / Designation Endowment Distribution Funds for Excellence 15% Scholarships/Fellowships 50% Chairs/Professorships 35% $9.38M Endowment Designation Academics Athletics $515.57M Endowment Spending Formula Spending Formula A weighted calculation of two components: First component (80%) is the prior year payout amount adjusted for inflation (CPI) Second component (20%) is the spending policy target rate (currently 4%) applied to the 12-month avg. of market values [80%)(Prior year’s payout)(1+CPI)]+[(20%)(12-month average of market value)(4.0%)] Endowment Spending Calculation Example: Payout Calculation: [(.80)($40,000)(1+.034)]+[(.20)($1,080,000)(.04)] = $41,728 Endowment Asset Allocation Asset Class Equity Flexible Capital Inflation Hedging Credit Deflation Hedge Dollar Hedge Liquidity Total: Domestic Public Equity Non-U.S. Developed Equity Emerging Markets Equity Global Private Equity Long/Short and Absolute Return Natural Resources (Public and Private) Commodities Real Estate (Public and Private) U.S. TIPS Core Bond High Yield U.S. Treasuries Non-U.S. Government Bonds Cash (T-bills) Percent Allocation 15.0 14.0 7.5 12.5 25.0 4.0 4.0 5.0 2.0 6.0 5.0 100.0 2012 Development Results | calendar year 2012 Total Gifts and Commitments $111,001,242 $76,424,036 Outright Gifts and Pledges $9,494,065 Deferred Irrevocable Gifts 41% cumulative $25,083,141 Deferred Revocable Gifts increase Four Year Results $122,875,000 $93,942,647 $85,722,620 +10% +18% +9% 2009 2010 2011 2012 2013 Goal $78,735,752 $110,480,608 2013 Campaign Timeline Preparation Phase Leadership Gift Phase Public Phase Through Dec. 31, 2012 Goal: $300 million Actual: $400.6 million Jan. 1, 2013 (24-30 months) Goal: $400 million Cumulative: $700 million 30-36 months (Dec. 31, 2017) Goal: $300 million Cumulative: $1 billion CAMPAIGN AUTHORIZATION CAMPAIGN KICKOFF CAMPAIGN CELEBRATION PostCampaign Assessment Financial Campaign Objectives Campaign seeks to secure at least $1 billion in new gifts and commitments, both spendable/annual and endowed, for Student Support, Faculty Support, Programmatic Support, and Facility Support. Endowment Giving - for a campaign of $1 billion, it is expected that approximately 25-35% of the total will be endowment commitments. Deferred Gifts - for a campaign of $1 billion, it is expected that approximately 30% of the total will be deferred gifts. Deferred gift instruments, such as gift annuities, charitable remainder trusts, and simple bequests often are designated for endowment. Additional Campaign Objectives Volunteer Engagement – new volunteers will be engaged to serve Auburn during the campaign. Donor Relations and Stewardship - the nature/level of donor appreciation and stewardship should be enhanced during and after the campaign. Annual Giving - the annual giving program should be positioned to generate increased alumni participation and secure gifts in excess of $5 million annually. Sustainable Giving – the level of annual philanthropic support will be elevated during the campaign. Post campaign aspiration is to maintain new gifts and commitments of approximately $100 million annually, economic factors permitting. Campaign Progress | THROUGH 08.31.13 Area of Support Working Goal Progress % to Goal Students Faculty $237,362,500 $139,435,000 $129,384,411 $29,857,359 54.51% 21.41% Programs $377,453,553 $301,203,141 79.80% Facilities Totals $338,720,559 $1,092,971,612 $39,468,528 $499,913,439 11.65% 45.74% Campaign Progress | THROUGH 08.31.13 Area of Support Outright Gifts and Pledges Deferred Irrevocable Deferred Revocable Campaign Total Student Support Annual Endowed Subtotal Faculty Support Annual Endowed Subtotal Program Support Annual Endowed Subtotal Facility Support Annual Endowed Subtotal Totals Annual Endowed Totals 61,620,310 32,988,278 $94,608,588 341,626 6,791,230 $7,132,856 4,585,502 23,057,465 $27,642,967 66,547,438 62,836,974 $129,384,411 2,367,165 24,631,101 $26,998,265 22,157 712,506 $734,663 0 2,124,431 $2,124,431 2,389,321 27,468,038 $29,857,359 172,551,190 54,619,086 $227,170,275 12,455,564 4,246,189 $16,701,753 42,867,711 14,463,401 $57,331,112 227,874,465 73,328,676 $301,203,141 32,541,677 1,325 $32,543,002 4,414,992 0 $4,414,992 2,165,534 345,000 $2,510,534 39,122,203 346,325 $39,468,528 $269,080,341 $112,239,789 $17,234,339 $11,749,925 $49,618,747 $39,990,298 $335,933,427 $163,980,012 $381,320,130 $28,984,265 $89,609,044 $499,913,439 Campaign Progress | THROUGH 08.31.13 COLLEGES AND SCHOOLS Campaign Goal Progress toward Campaign Goal (through 08.31.13) % of Progress toward Goal Agriculture (includes AAES) $42,000,000 $27,116,516 64.56% Architecture, Design & Construction $30,700,000 $10,346,388 33.70% Business $100,000,000 $66,362,264 66.36% Education $34,900,000 $8,512,261 24.39% $206,600,000 $87,712,928 42.46% $19,804,112 $13,419,268 67.76% Graduate School $1,500,000 $243,666 16.24% Honors College $4,000,000 $1,093,022 27.33% Human Sciences $36,000,000 $16,414,214 45.60% Liberal Arts $22,950,000 $14,369,569 62.61% Nursing $18,800,000 $6,801,559 36.18% Pharmacy $21,050,000 $5,076,477 24.12% Sciences & Mathematics $34,000,000 $12,743,617 37.48% Veterinary Medicine $63,110,000 $38,839,882 61.54% Engineering Forestry & Wildlife Sciences Campaign Progress | THROUGH 08.31.13 CAMPUS-WIDE UNITS Alabama Cooperative Extension Sys. Campaign Goal Progress toward Campaign Goal (through 08.31.13) % of Progress toward Goal $10,000,000 $7,191,578 71.92% $7,150,000 $4,248,204 59.42% $223,000,000 $123,528,044 55.39% Auburn University Montgomery $12,500,000 $11,511,281 92.09% Central Classroom Bldg. (proposed) $49,500,000 $0 0.00% $4,900,000 $760,109 15.51% $41,000,000 $20,131,575 49.10% Libraries $5,000,000 $1,558,310 31.17% Museum $7,500,000 $3,418,026 45.57% Outreach $10,657,500 $142,684 1.34% Performing Arts Center (proposed) $60,000,000 $0 0.00% Research $17,100,000 $4,353,340 25.46% Student Affairs $7,250,000 $668,882 9.23% Sustainability $2,000,000 $15,909 0.80% Alumni Affairs Athletics Diversity & Multicultural Affairs Enrollment Services Questions?