The Endowment

Real and Lasting Value

The Piano Shop on the Left Bank, a memoir by an American who lives in Paris, describes a small atelier of 19th-century charm where the proprietor restores and sells an eclectic mix of classic pianos. The owner is very selective; he deals only with people he already knows or who arrive with strong references. He develops a personal relationship with his clients, comes to know their musical abilities and tastes, and eventually finds the piano that's just right for each of them. His clients invest considerable time and money in the transaction, and receive a rare and beautiful instrument and a lasting memory in return. The book celebrates pride of craft, a bond sealed by shared enthusiasms and the satisfaction of remaining small and, in the best sense of the word, exclusive.

At Hamilton, we, too, are selective and develop close relationships with all our "clients," who invest their time and money and receive in return a uniquely personal education and memories that last a lifetime. The cost is high; it's possible to spend much less. There are warehouse stores for used pianos, and for college educations, too. But the value that Hamilton provides is real and lasting. We don't just talk about intellectual and personal development; we actually enable our students to achieve it.

It isn't easy, because tuition and fees cover only 60 percent of the cost of a Hamilton education. Most of the rest comes from the income generated by the College's endowment fund, which pays for more than a quarter of the College's operating budget and most of the financial aid it offers to students. Hamilton's endowment enables it to remain, like the piano shop, a small, exclusive place that has sealed the bond on many a shared enthusiasm.

Hamilton's Endowment: Robust Returns and a Conservative Eye

In the past 30 years, Hamilton's endowment has increased nearly 20-fold, from $27 million to more than $500 million. The College owes this extraordinary growth to the generosity of its alumni, parents and friends -- and to the skill of the trustees who have managed the fund through the ups and downs of the economy.

While many college endowments prospered during the '80s and '90s, few did as well as Hamilton's. When the economy soured in the few years following, many funds performed weakly. Over the three-year period ending in mid-2004, when the Standard & Poor's 500 lost 2 percent, Hamilton's average return was 7 percent. Its one-year return ending in mid-2004 was an outstanding 24 percent, which placed Hamilton eighth out of 670 institutions in a national study of college endowments. As the calendar ended in 2004, Hamilton had a 17 percent return, which was above the S&P 500 of 11 percent, including dividends.

Hamilton's trustees view these robust returns with a properly conservative eye; they limit endowment spending to only five percent of a 12-quarter moving average of the fund's market value, with the goal of maintaining the buying power of the endowment in perpetuity.

Still, while they may envy our investment performance, many of our peer schools have larger endowments -- some considerably larger -- enabling them to compete more effectively for the most talented students and faculty members. If Hamilton is to answer President Stewart's call to raise its visibility and secure its reputation for excellence, it must add to its endowment to provide more funds for student aid, faculty support and other important purposes.

Over many years now, Hamilton has been a college of opportunity for young people from lower-income families, but today a family of average means is hard-pressed to send a child here without considerable help.

The College's ability to provide financial aid to these students is crucial to retaining its character; without it, Hamilton would become what it is sometimes erroneously portrayed to be: a school for "rich kids." In fact, Hamilton provides financial aid to more than half its students at a sum of about $20 million each year, and it will need to provide more if it is to attract a wide range of desirable candidates for admission.

Before the rampant inflation of the late 1970s and early '80s and the inexorable rise in educational costs, Hamilton was able to practice a need-blind admission policy; that is, it could accept applicants without regard to their ability to pay for their education. For some years since, it has been unable to do that. Now Hamilton simply can't afford to accept too many students who need a lot of aid, and the assistance we can provide sometimes isn't enough. We reserve our best packages for the very top applicants, leaving some highly qualified candidates without enough aid. In too many cases, we are matched against peer schools with larger endowments for the favor of these students, and when we offer loans and they offer outright aid, we don't often prevail. In a recent survey of the applicants we accepted but didn't enroll, 42 percent cited financial aid or cost as a significant factor in their decision. For some, Hamilton was their first choice. This is a loss, to them and to our College.

The College's long-term objective is to return to a need-blind policy and, for the present, to move in that direction. We'll get there only by adding to our endowment for financial aid.

Hamilton provides financial aid to students through its annual operating budget, but even more effectively through hundreds of endowed scholarships.

Some of these scholarships are general in nature, to be administered at the College's discretion. Others are more narrowly defined, requiring recipients to meet very specific criteria, but virtually all can be practicably applied by the College to support the type of students, fields of study and campus activities that directly contribute to its educational mission.

Endowed scholarships give the College tremendous flexibility. For example, for an applicant we really want to enroll, but whose financial resources are stretched to the limit, we can often find a special scholarship to sweeten the student's aid package without draining more funds from our operating budget. And by reducing the burden on the operating budget, the money saved can be used to pay for essential day-to-day needs, like new books for the library or a new coat of paint for the Chapel.

Hamilton alumni don't forget their teachers. A professor's influence leaves traces on the lives of students long after the numbers, dates, theories, formulas, proofs and names of the characters have pretty well vanished.

We can never repay our teachers for what they've given us, so, as alumni, we give to the College. In its turn, Hamilton introduces another generation of teachers to the next generation of students, using our support to attract and retain the best. To continue the cycle, Hamilton needs added endowment for faculty support, and because of new trends in teaching and learning, needs it now more than ever.

At its core, a Hamilton education hasn't changed much in the last 30 years, but the face of that education has. The College's new curriculum, combined with a recent evolution in the art of teaching, places extra demands on our faculty. Hamilton encourages closer, more interactive working relationships between professors and students, both inside and outside the classroom. Faculty members use a more active style of teaching instead of lectures, using discussion groups to encourage exchange and debate. When classes are over, the conversations may continue, moving to other, less formal venues -- more of which the College plans to provide through funds raised by the Excelsior Campaign. With the assistance of students, faculty members engage in more research and scholarship than ever before -- an activity in which both parties teach as they learn and learn as they teach.

The curriculum's new Sophomore Seminar program also makes new learning a must for our faculty. These small, interdisciplinary courses call for groups of professors to teach in teams, a job that requires them to become well grounded in each other's specialties and to integrate their own into the overall theme of the seminar. In the absence of distribution requirements, faculty advisors, charged with helping to shape the education of their advisees, spend more time getting to know their students better. And the College now makes every teacher responsible for improving the written and oral expression of his or her students, an assignment for which even some of the best writers and speakers may require some extra training.

In summary, Hamilton needs to keep its faculty teaching and learning at the same time. To provide them with fair and competitive compensation for all they do, we must add to our endowment for faculty support. The income from this endowment can be used to fund named professorships, research, equipment and travel to academic conferences.

One of Hamilton's main objectives, as documented in its strategic plan, is to "increase its support for students, faculty members and all other employees, particularly with respect to diversity."

The College believes that students who live in a diverse community are better prepared for the wider world and that diversity in its various forms -- including ethnic, racial, religious, geographic and socio-economic -- contributes to the vibrancy of intellectual life on campus. Through financial aid, we introduce some students to a life of aspirational possibilities their families have never known.

As part of this effort, the Excelsior Campaign will establish a special endowment to promote diversity in the College community through a variety of incentives and support programs. These include a travel fund for the recruitment of faculty, a start-up fund to attract and retain faculty from underrepresented groups, grants for disadvantaged students, diversity workshops for all new employees, and support for a more diverse culture as represented in campus lectures and events.

The Diversity Endowment can play an important role in opening up the campus to new influences and perspectives and will help to encourage in all our students a tolerance and respect for opposing viewpoints -- one of the basic tenets of a liberal arts education.

As graduation nears, most Hamilton students worry about jobs and careers. The few unwrinkled brows are usually owned by those who have served as summer interns before their senior years.

The working experience and the contacts made by summer apprentices often lead to fruitful careers in fields like education, government, the media, the arts or advertising. The only problem is that many of these internships are unpaid. How can students, especially those from lower-income families, afford to spend two months without a paycheck in New York City, Boston, Chicago or other such prime locations for summer jobs?

Many of our peer colleges solved this problem years ago by establishing an endowment for student internships. They use the income to subsidize living expenses for interns with unpaid summer jobs. This is a win-win for these colleges: a big selling point with applicants for admission and a cause for alumni gratitude.

Hamilton now plans to establish such an endowment, the income from which will enable a number of students each year to accept unpaid summer internship opportunities by defraying their cost-of-living expenses. The more experience our students gain in the working world, the more attractive they are to employers and graduate schools -- and the more attractive Hamilton will be to prospective students.

The natural beauty of the Hamilton campus is undoubtedly one of the College's great assets and attractions.

It's hard to imagine any student, even the most book-bound, who hasn't enjoyed a walk through the Root Glen or stopped to admire some of the wonderful old trees on campus.

More than a few amateur horticulturists began their studies here, on an extracurricular basis. But thanks to the recently established Hamilton College Arboretum Fund, the whole campus is becoming an environmental classroom.

An arboretum is, officially, a place where trees, shrubs and herbaceous plants are grown for scientific and educational purposes. The Hamilton Arboretum's mission is to preserve the historic landscape of the campus, build on the diversity of the collection and keep the place looking beautiful.

The arboretum, which complements the highly renowned Root Glen, is managed by a director and an advisory committee from the College. Under its watch, the College will be an outdoor laboratory for the study of botany, biology and horticulture. The arboretum will maintain, label, catalogue and map the campus, providing signs and a brochure that identify the trees. The Excelsior Campaign seeks to add to the arboretum's endowment, helping it to raise the College community's awareness of the treasures in its midst and promote long--term stewardship of the environment.

For students planning to someday enter the diplomatic corps, the history of town-gown relations would make an enlightening case study.

Through such diplomacy -- and with goodwill on both sides -- Hamilton maintains a cordial and productive partnership with the Village of Clinton and the Town of Kirkland, helped recently by the establishment of an endowment fund designed to improve communication and enhance relations with our neighbors.

Through the Excelsior Campaign, the College plans to add to this fund, which generates income for grants to local organizations and agencies. Our primary focus is on education; beneficiaries thus far include the Clinton Central School District and its foundation, St. Mary's School, the Clinton Historical Society, the Kirkland Arts Center and the Kirkland Town Library. Grants pay for items such as computers and athletic fields for the schools, a renovated dance studio and emergency heating for the arts center, a summer history program for the historical society, and audiovisual equipment and a pre-school reading program for the library. The local police and fire departments have also received grants for educational efforts in public safety. These grants have sponsored evening police academies for homeland security and paid for infrared cameras for firefighters and defibrillators for emergency medical technicians.

President Stewart chairs the committee of trustees, local officials and local alumni who decide on grant recipients. In 2004, the College issued eight grants totaling $30,000. We solicit local businesses and our own employees to contribute to this fund, and the Excelsior Campaign seeks to build it further.

To increase the College's total endowment and support all the purposes and programs described in this booklet -- for scholarship funds, faculty support, diversity, student internships, the arboretum and town & gown -- the Excelsior Campaign seeks to raise $75 million.

More about the Endowment

The endowment has soared from $27 million to more than $550 million in the past 30 years.

Hamilton provides scholarship aid to more than 50% of its students.

Endowment income supports research, named professorships and teaching funds.