In its 160-year history, Grinnell College has been rich and it has been strapped. As the many generously paid professors and well-subsidized students here today will readily tell you, being rich is better.
With an endowment that has grown from about $44-million in 1980 to about $1.4-billion today, Grinnell is the wealthiest liberal-arts college in the country and has the 35th-largest endowment over all.
For its 1,500 students, Grinnell’s prosperity means paid summer research projects with professors on the campus, college-financed internships off the campus, and hands-on classroom experience in first-class facilities where equipment and supplies — whether expensive reagents for an introductory chemistry course or ink in the printmaking studio — are never in short supply.
“Especially if you are a science major,” says Priya Malik, a senior from Delhi, India, “you definitely are under the impression that you are going to a rich college.”
The signs and sounds of the college’s affluence are unmistakable on this immaculately tended 120-acre campus, with its mix of low-slung Tudor residence halls, turreted academic buildings, and Modernist architecture.
At the campus’s northern edge is the rumble of heavy equipment at the side-by-side construction sites of a new Cesar Pelli-designed student center and an expansion of the science building. And at the south are the haunting tones of the Javanese iron gamelan in the college’s world-music collection, housed in the elegant arts complex. (This arts complex, replete with a gallery and a recording studio, was also designed by the Pelli firm and opened in 1999.)
The $43-million science addition and the $42-million student center, which will feature a soaring glass wall and several styles of brick, stone, and handmade tile, are part of a $163-million building boom that began in 2000. It has also included a dormitory, a fitness center, and an angular glass, steel, and limestone building for the admissions and financial-aid offices.
Money from the endowment paid for most of it, except for about $50-million from gifts.
Grinnell is among the lucky few colleges in the country that rarely, if ever, worry about meeting enrollment targets and instead have the luxury of focusing on how best to deploy their ever-increasing endowments to attract the most desirable students. But even as such colleges have been growing richer, the students who get to enjoy their high-tech science centers, palatial fitness complexes, and intimate classes are still mostly from wealthy and middle-class families.
Grinnell and other such colleges do provide financial aid. But critics argue that it and others should do more to make their colleges more accessible to students from poor families.
When it comes to serving poor students, “Grinnell gets a solid failing grade from us,” says Thomas G. Mortenson, senior scholar at the Pell Institute for the Study of Opportunity in Higher Education. “Other elite schools do, too.”
Mr. Mortenson, who happens to live in Iowa, is an unapologetic advocate for expanding access to higher education to underrepresented students. “Some of the rich schools are out there to pad their endowment,” says Mr. Mortensen, “rather than serve the public interest.”
One college that recently answered the call is Amherst College, pledging to provide admission — and the requisite financial aid — for as many as 120 students a year who come from families needy enough to qualify for Pell Grants.
Grinnell says it is paying attention, too. The college is one of a diminishing number that still meets the full financial need of all American students, its officials note, although in some cases, some of that aid comes through low-interest loans from the college or a required campus job.
And Grinnell’s president has begun hinting that it, too, may be preparing a big move to make the college more affordable to needy students, even as it moves aggressively over the next few yeas to increase tuition.
Not Thinking ‘Rich’
Grinnell’s striking buildings by celebrity architects are only the most visible signs of the college’s prosperity. Grinnell provides need-based financial aid to 65 percent of its students and merit scholarships to an additional 25 percent, at a total cost of nearly $21-million this year (nearly 30 percent of its overall budget). For faculty members, it offers not only nationally competitive salaries but also a semester of paid leave to new professors after their third year of teaching, to help them keep abreast of their fields before they come up for tenure review.
The college even sponsors its own Peace Corps-style program, Grinnell Corps, which sends as many as 15 graduating seniors overseas for a year to teach English in places like Nanjing, in China, and Lesotho.
“The reason we can do it is because of the endowment,” says Russell K. Osgood, Grinnell’s president. The college depends on its endowment for nearly half of its $69-million annual budget, an unusually high proportion even for a college with a big endowment.
But Mr. Osgood, who assumed the post in 1998, says wealth also brings challenges. “If you say, ‘We’re a rich college,’ you’ll be undisciplined” about finances. The colleges’ spending is focused, he says, on trying to ensure that all students can take part in the college’s offerings, no matter their income, and to overcome some of the limitations of Grinnell’s location “in a little town in Iowa.”
He adds, “We don’t sit around and think, How can we rain money down on our students?”
Despite the spending here on programs and facilities, Grinnell does have an unassuming air. Students seem serious about their studies (at least during midterm week), few drive flashy cars, and for most last month’s spring break seemed to involve a trip home, a visit with friends, or a community-service project, rather than a fling in Cancún. But Grinnell’s wealth comes into play here, too: Students participating in many of the “alternative spring break” projects receive a subsidy from the college.
Warren Buffett and Joseph Who?
The story of Grinnell’s endowment growth begins with Joseph F. Rosenfield, Class of 1925. A college trustee from 1941 until his death in 2000, Mr. Rosenfield was a department-store executive turned investor who occasionally bailed out the college when it was unable to pay its bills and who, along with his friend Warren E. Buffett, helped to guide Grinnell’s investment miracle. (Mr. Buffett, the storied investor, was active on the board from 1968 until 1987.)
Thanks to Mr. Rosenfield — once described by Money magazine as “the best investor you’ve never heard of” — Grinnell was an early investor in a semiconductor company founded by another alumnus, Robert N. Noyce, that would later become Intel. Grinnell also made a splash in 1976 when, at Mr. Buffett’s suggestion, it acquired a commercial television station in Dayton, Ohio, for about $13-million — an unusual investment for a college, particularly at that time — and then sold it, five years later, for $49-million.
Since 1980 the college has had only one fiscal year, 2000, when investment returns declined, and only six other years in which its returns fell below 10 percent. In 15 different years, it had returns of more than 15 percent, and in 12 of those years, its returns exceeded 20 percent.
Grinnell reveals few details about its idiosyncratic approach to investing. David S. Clay, the college’s treasurer, does say that its endowment is probably far less diversified than other colleges’ and far less rigid about asset allocation. He says the institution has succeeded by taking a long-term view, looking for opportunities at low prices, and being willing to allocate big stakes when it found them. Two of its most successful investments have been Freddie Mac and the Sequoia Fund.
Mark Montgomery, a professor of economics, says the college’s investment success is a curse as well as a blessing. “There’s almost a cult of the endowment at Grinnell,” he says, and for all of the college’s success, “we have not taken advantage of our wealth to really lower the burden on our students.”
Eli Zigas, a senior from Washington, D.C., says Grinnell could be a small part of the solution to the growing economic divide in the country. Today only 11.5 percent of Grinnell students come from families with incomes that would qualify them for Pell Grants.
With its endowment, Grinnell “could make an enormous statement,” say Mr. Zigas, a student leader with a deeper-than-typical understanding of the college’s finances. On a recent evening, over pizza in the snack bar of the college’s 1960s-vintage student center, he shared his affection for what the college offers and his frustration for what it doesn’t: “We should and can be different,” he says, “because we have the cushion.”
It is a view that Mr. Montgomery and many of his colleagues share. Still, as the economics professor readily acknowledges, the endowment has transformed Grinnell, “and our lives are all the better for that.”
The Good Life
Grinnell professors receive not only generous leaves and salaries that match those at colleges where the cost of living is lot higher, but also, typically, stipends to attend at least one academic conference a year. Usually, there is enough left over to bring along a few students.
Faculty members teach in first-rate facilities like the stone-and-glass Bucksbaum Center for the Arts, which anchors the southern tip of this rectangular campus. There, in one wing, students study world music in a two-story room festooned with exotic instruments hanging like tools in a garage. In another, participants in a physics class called “Bridges, Towers, and Skyscrapers” come to examine the designs of famous Swiss architects now on display in the sleek, light-filled gallery. The gallery routinely draws a half-dozen visiting exhibits each year, in addition to shows by students and faculty members.
Neither does Grinnell skimp at the opposite end of the campus, in the Robert N. Noyce Science Center. Introductory-science courses require students to work in small teams in hands-on experiments, and they do so with some of the most modern laboratory benches, electronic microscopes, and measuring instruments available.
“I have everything I need, and I’m not in a cheap field,” says Leslie Gregg-Jolly, an associate professor of biology, who on a recent March day was supervising freshmen in the lab as they fertilized sea urchins.
Ms. Gregg-Jolly also relishes working with the high-caliber students here, who can handle the rigors of the curriculum. “Students in my molecular lab are doing work that would lead to publication,” she says.
And Grinnell’s academic program is about to expand. As part of a strategic plan adopted a year ago, the college will add 12 new full-time faculty positions over the next five years in several new interdisciplinary fields.
Learning Off the Grid
The emphasis on hands-on experiences, through research programs and internships, is another hallmark of the undergraduate experience made possible by the endowment. Students working on research projects are paid as much as $3,200 a semester; those in internships receive up to $2,400. Altogether, about 250 students take part in the programs each year, at an overall cost of $750,000.
The idea is “to do something they can’t do within our curriculum and that they couldn’t do without the money,” says Steve Langerud, associate dean for experiential education, who oversees the internships. Students have worked in rare-book stores in England, studied HIV in Zambia, and apprenticed with a sports agent in Oklahoma, he says. “We really push them to things that are off the grid.”
The endowment also makes possible a program that brings nationally and internationally known speakers to the campus for short symposia on major issues in human rights and public affairs. This semester the topic was the genocide in the Darfur region of Sudan, and speakers included Nicholas D. Kristof, a columnist for The New York Times. Later this spring, another symposium will focus on the avian flu.
Alexey Hartlieb-Shea, a senior from Burlington, Vt., who takes in his share of the visitors’ talks, as well as exhibits in the art gallery, says those are the kinds of extras he loves most at Grinnell. “I can’t imagine I could get a better education anywhere else,” he says.
But Mr. Hartlieb-Shea, caught between sets during his evening workout at the airy two-story fitness center, says he is uneasy about the college’s direction. While he enjoys lifting weights beneath a balcony holding rows of high-end elliptical machines, treadmills, rowing machines, and stationary bicycles, he wonders if facilities like the new student center are necessary. “At the end of the day, you go to college because of the education you’re going to get, and the experiences,” he says.
And he laments that Grinnell has become more expensive. During his four years here, the cost has gone up by $5,000.
That trend is going to continue. As part of the strategic plan, Grinnell is raising its tuition by 12 percent over the next two years to be more in line with its three Midwestern peers: Carleton, Macalester, and Oberlin Colleges.
Meanwhile, the rate of spending from the endowment is going down. Three years ago it was 4.5 percent. Next year it will be 4 percent. The moves are part of a conscious pricing plan to keep revenue sources in balance and to send a message to students and parents that Grinnell believes its education is worth the price. For those who can afford it, “we don’t want to be a bargain,” says Mr. Osgood, the president.
‘Moving Boldly’
While it raises its price, Grinnell will continue to take steps to become more racially and economically diverse, say Mr. Osgood and James Sumner, dean of admission and financial aid. About 67 percent of the students are white. Three years ago the college began accepting students from inner-city high schools through a program run by the Posse Foundation, which helps colleges admit students in groups of about 10 and provides mentors for them. By next year, when Posse students will be enrolled in all four undergraduate classes, the program will cost Grinnell about $1.8-million, mostly for financial aid.
This month the college will also sponsor two “Grinnell on Our Dime” weekends, when it pays the travel costs for campus visits for admitted prospective freshmen who are the first generation of their families to go to college, are students of color, or are financially needy enough to qualify for Pell Grants. The college expects about 60 students.
Grinnell is also proud that its students with Pell Grants, many of whom came from high schools that don’t offer top-tier preparation, graduate at essentially the same rate as the student body as a whole.
Mr. Osgood says the policies have helped to make Grinnell more diverse than its peers, even while he acknowledges that most of those colleges aren’t all that diverse themselves. “If we had a lot of truly poor people, I guess I’d be a little more proud of it,” the president concedes.
Nordahl L. Brue, chairman of the Board of Trustees, says Grinnell’s spending and pricing policies have been well directed. To be a great liberal-arts college, “you have to have great facilities,” he says. And those financially needy students who must borrow to pay for Grinnell still graduate carrying less debt, on average, than do graduates of Iowa’s public colleges. (The average for Grinnell students is about $16,000; the University of Iowa about $17,000; and Iowa State University about $27,000.)
But Mr. Brue, who is probably better known as the founder of Bruegger’s bagel chain, says he realizes Grinnell could soon have even more endowment earnings at its disposal because construction on the campus is winding down.
The college’s leaders also recognize that other wealthy institutions, including Amherst College and Princeton and Stanford Universities, have recently begun making high-profile commitments to serve larger numbers of needy students by replacing loans with grants.
Mr. Osgood says that in the not-so-distant future, Grinnell might use the endowment to make “dramatic increases” in the amounts it provides needy students, probably in the form of forgivable loans from the college. The program, which is far from a done deal, would most likely be adopted in conjunction with Grinnell’s first-ever major fund-raising campaign.
Mr. Brue says Grinnell trustees are open to new ideas. As much as they seek to protect the endowment for the benefit of the college, he insists that they also recognize the college’s broader obligations. “Our job is to look at the horizon, not at the foreground,” he says. “But I don’t think that will keep us from moving boldly.”
| A TALE OF 2 COLLEGES | Founded: 1846 | Founded: 1843 | | Full-time students: 1,492 | Full-time students: 1,068 | | Full-time faculty members: 156 | Full-time faculty members: 84 | | Part-time faculty members: 43 | Part-time faculty members: 47 | | Endowment as of June 30, 2005: $1.39-billion | Endowment as of June 30, 2005: $16.6-million | | Endowment per student: $902,951 | Endowment per student: $15,543 | | Average salary for full professor: $99,883 | Average salary for full professor: $61,000 | | Undergraduate tuition, room, board, and fees: $34,814 | Undergraduate tuition, room, board, and fees: $25,390 | | Student-to-faculty ratio 9:1 | Student-to-faculty ratio: 11:1 | | Varsity sports teams: 20 | Varsity sports teams: 16 | | Revenue Sources | | Total operating budget: $69.6-million | Total operating budget: $18-million | | | | | STUDENT PROFILE (Fall 2005) | | Freshman applicants for full-time enrollment: 3,730 | Freshman applicants for full-time enrollment: 963 | | Percent admitted: 37.4% | Percent admitted: 58% | | Percent of admitted students enrolled: 27.6% | Percent of admitted students enrolled: 41.7% | | Average ACT for freshman class: 30 (out of a possible 36) | Average ACT for freshman class: 23 (out of a possible 36) | | Average SAT for freshman class: 1363 | | Undergraduates receiving Pell Grants: | | | | | Undergraduates who are among the first generation of their family to attend college: | | | | | Undergraduates from Iowa: | | | | | Makeup of Student Body: | | | | | NOTE: Except where otherwise indicated, figures are from 2005-6; percentages may not add to 100 because of rounding.
* College officials estimate that the majority of unknowns are white. | | SOURCES: Grinnell College; Clarke College | |
| ENDOWMENT GROWTH AT GRINNELL COLLEGE | In millions | | 1980: | | | 1985: | | | 1990: | | | 1995: | | | 2000: | | | 2005: | | | SOURCE: Grinnell College | Donations to the endowment during this period totaled $49.2-million. Spending from the endowment during this period totaled $480.1-million. As of December 31, 2005, the endowment was valued at more than $1.43-billion. |
http://chronicle.com Section: Special Report Volume 52, Issue 31, Page A14
