Endowments at Rice

Endowed gifts -- like scholarships, fellowships, faculty chairs and departmental funds -- are an enduring means of support for Rice University that create a lasting legacy for Rice’s donors. An endowment is a permanent fund given to an individual or an institution for the ongoing support of that organization.

At Rice, endowments account for 40 percent of the operating budget and are structured so that the principal amount is kept whole while the investment income and gains are available for use each year to support university activities. Once established, an endowment grows over time and has an impact in perpetuity.

The impact of these generous gifts is seen and felt across campus every day, ensuring a sustainable base for future Owls.

Endowments: Donor FAQs
  • What kinds of endowments can I establish at Rice?

    Need-based scholarships – With Rice’s commitment to a need-blind admissions policy, endowed scholarships give  admissions staff the resources to meet the financial need of our extraordinary students who are accepted to Rice.

    Merit-based scholarships – As recruiting for the “best and brightest” students is extremely competitive, merit-based scholarships are an important tool for distinguishing admission to Rice from acceptance at another university.

    Graduate Student Fellowships – Graduate students play a critical role in the teaching and research of Rice.  Fellowships allow Rice to successfully compete with other top graduate programs for these young researchers.

    Endowed Chairs – Faculty endowments are an important resource for recruiting and retaining the elite faculty at Rice. Through endowed chairs, Rice is able to support exceptional faculty for their work, accomplishments and contributions to teaching and research.

    Lecture Series / Visiting Scholars – Endowments that support visiting scholars and lecturers allow Rice to enhance our current curriculum by exposing our students and the larger Rice community to different perspectives, voices and areas of expertise.

    Departmental Endowments – These funds provide an important resource for deans, directors and department chairs to meet the highest priorities of their departments, as well as to take advantage of unique opportunities that arise for which there is not current funding.

  • How do I create an endowment?

    An endowment can be created by making a one-time gift of cash, credit card or securities, or by creating a pledge, payable over five years or less. Endowments can be created with planned gifts, as directed by estate plans or a charitable gift annuity or trust. A development professional can help you create the payment arrangement that best meets your needs. 

    Once a donor decides to create an endowment at Rice, they will work with one of our development staff members to create an endowed fund agreement or EFA.  Please call 713-348-4615 or stewardship@rice.edu for assistance.

     

  • Can my friends and I pool our resources in order to create an endowment?

    Yes. One of the most enduring ways to celebrate a loved one or to support a common interest is for groups to create an endowment.  Rice development staff can work with you to suggest ways in which your group may accomplish this goal.  Please contact us at 713-348-4615 or stewardship@rice.edu to begin a conversation. 

  • May I place restrictions on my endowment? May I see a sample endowed fund agreement?

    Donors often like to express their preference for supporting a particular department or a student who is from a specific city or studying a specific discipline. Rice's development professionals will help to craft an endowed fund agreement that reflects the donor's wishes, but also allows for flexibility in using the fund over time. 

    Because endowments are permanent funds that will be administered by the university, it is important to be sure the donor and Rice are in agreement about the purpose of the endowment.  Donors may restrict the purpose of endowments (such as to support a scholarship for students studying music), but the restrictions have to allow for future flexibility and must not violate any laws. 

    A sample endowed fund agreement (EFA) is attached here.

    Once the donor and Rice agree on an endowed fund agreement, a Rice staff member will provide the donor with two original EFAs for signature first by the donor, then by the relevant Rice staff.  Once these are fully executed by all parties, one original will be returned to the donor; the second will be maintained by Rice.  

  • What is the minimum amount required to create an endowed fund?

    The minimum funding amounts depend on the purpose of the fund and what your charitable goals are in creating an endowment. Typically, scholarship endowments begin at $100,000 and chairs begin at $2,500,000, though your specific philanthropic goals will influence the funds required for your endowment.

  • When will my endowment activate?

    Rice policy allows for endowments to be activated at only one time per year – July 1, which is the beginning of the university’s fiscal year.  Endowments qualify for activation at either 2.0% or 4.5% if they meet two criteria:

    1. The endowment was fully funded by Dec. 31st of the preceding year.  (e.g. to activate on July 1, 2017, the final pledge payment would need to be paid by Dec. 31, 2016.)
       
    2. The fund has accumulated sufficient earnings to support the budget for at least two years when it is activated.  If the analysis shows that the fund is not able to support the budget at 4.5 percent for a minimum of two years, the university will activate the fund at a lower level (approximately 2 percent) for the first year.  A review will be conducted each year until it passes the reserves test.  More information is available on the VP for Investments site here
  • How much money will my endowed fund generate?

    Individual circumstances will vary, but typically a fund will activate at 2.0 or 4.5 percent of the value of the gift, and the distribution will increase annually by an average of 2 percent. For example: 

    A scholarship endowment of $100,000 activated at 4.5% will generate approximately $4,500 to be used for scholarships.  This amount will increase slightly each year, so the second year approximately $4,590 will be available for scholarships.

    For more information, please visit the Rice Management Company site here.

  • How are scholarship students selected?

    The Office of Financial Aid carefully reviews the guidelines of the endowed fund agreements and matches these criteria to students who qualify for financial assistance.  With over 1,500 scholarships, this process can take a little time, but ensures that the donor’s preferences are honored.

    Unfortunately due to IRS guidelines, donors may not aid in the selection process of the scholarship recipient.  

  • How will I be notified who is receiving my scholarship?

    You will receive information regarding the student(s) your scholarship is supporting with your annual endowment report.  For those donors wishing to meet these remarkable students, we would be happy to arrange a meeting or facilitate other correspondence between the donor and student.  Please contact us at stewardship@rice.edu or 713-348-4615 for assistance.

  • Can I add to existing endowments?

    Many of our donors choose to add to their endowments in order to increase their fund’s impact on students and faculty.  You may also add to a fund that someone else (e.g. a family member) created.  

    Any gifts to an existing endowment are bound by the same guidelines of the endowed fund agreement.

Annual Endowment Reports

Beginning Nov. 1 of each year, the Constituent Relations office distributes reports to each donor or designee with an update on their endowment(s).  These reports provide information about the overall endowment performance, the performance of their individual endowments, and information about the students, faculty and programs that benefit from the fund.  Current and past reports are below.