Philanthropy & Education Journal cover and graphic, riding out the storm

Riding out the Storm: A Closer Look at PED 3.2

Kevin R. McClure and Paige Eppenstien Anderson’s article, “An Uneven Playing Field: Fundraising at Regional Public Universities in the Aftermath of the Great Recession,” from Philanthropy & Education’s newest issue is now available on JSTOR. Below, author Kevin McClure discusses the importance now, more than ever, for institutions to harness the power of fundraising to support the mission of their institutions as they ride out the storm of COVID-19.

Higher education institutions across the United States have closed due to COVID-19. Responding to the pandemic has caused a tidal wave of financial challenges for institutions, including:

  • lost income from fee-based services, 
  • rising institutional costs in the shift to distance education, 
  • potential summer and fall enrollment declines, 
  • anticipated state funding cuts, and
  • decreasing endowment returns

Although a federal stimulus bill included financial support for higher education, many institutions are still facing a budget shortfall. Numerous institutions have announced measures to address these gaps, such as hiring freezes and pay cuts. 

None of this was on our radar when we started researching fundraising at regional public universities in 2018. Regional public universities are institutions characterized by a learning- and teaching-centered culture, a historic commitment to underserved populations, and a focus on serving the cultural, economic, and civic life of their regions. These institutions tend to focus on undergraduate education and teaching more than graduate education and research. We wanted to know more about the fundraising experiences of leaders at these institutions, which educate more than a fifth of students pursuing a bachelor’s degree. Our prior research, as well as popular media articles, suggested regional public universities were struggling to compete for private donations.

Interviewees also said they struggled to keep up with rising expectations, which, as one interviewee explained, never go down. New presidents started and wanted to make a splash with a big donation or campaign. Finding those major donors could sometimes be difficult, especially for relatively new institutions or institutions whose graduates primarily entered fields like teaching or nursing. Some institutions were just starting to create a fundraising culture among students and alumni.

As we put the finishing touches on the article, we read reports about the effects of COVID-19 with a sense of deja vu. We saw articles about budget cuts, lay-offs, and calls for restructuring, mergers, and closures. Perhaps drawing from previous experience, at least one fundraising professional tweeted a plea for organizations not to cut fundraising staff, but rather ramp up operations. Our research became more salient than we expected because it provides a two-part cautionary tale for institutions as they navigate the pandemic and its aftermath.

First, we found that the importance of fundraising after the Great Recession increased because of state defunding, yet regional public universities weren’t always equipped with the staff and technology to meet rising needs and take advantage of opportunities. Cuts to fundraising offices came quickly, but rebuilding has been a much longer process. Institutional leaders will face many resource demands with insufficient resources in the coming months, but our research suggests there is reason to protect fundraising offices from cuts for the short- and long-term needs of the institution.

Second, our research shows the stark disparities between regional public universities and private and public research universities when it comes to fundraising infrastructure and outcomes. This is important on one level because it confirms what many higher education fundraising professionals already know–private donations are not a good replacement for state funding. As one interviewee explained to us, fundraising is icing on the cake, but it was never designed to be the cake. If policymakers cut funding for public institutions based on the premise that philanthropy will fill the gap, the result will be greater financial inequality between institutions. Money will largely flow to wealthy institutions, giving further reason for policymakers to direct stimulus money to institutions like regional public universities.

We hope the findings of our research are useful to policymakers and institutional leaders who are tasked with the unenviable responsibility of solving the complex problems wrought by the pandemic. COVID-19 has meant major revenue losses for institutions, and cutting fundraising could undercut the potential to bring in a major gift. Surviving the pandemic may hinge on investing in fundraising capacity. Although this study focused on regional public universities, the findings may be applicable to other types of institutions.

We were inspired by the passion evident in our interviewees’ stories and their clear desire to harness the power of fundraising to support the mission of their institutions. Fundraising certainly can’t fix everything, but our research shows that institutional leaders at regional public universities should leverage momentum built in the last decade to help ride out the storm. 

Read “An Uneven Playing Field: Fundraising at Regional Public Universities in the Aftermath of the Great Recession,” for free now on JSTOR!