Assembling a comprehensive strategy to elevate UCLA to the heights of the world’s great universities is a complex puzzle involving many different tactics. Two key pieces of that puzzle are the research and fund-raising programs, whose revenues can help to narrow the resource gap. Both areas have experienced significant growth in recent years, the result of focused attention by the campus leadership.
With some 5,000 funded projects every year, the research program represents about one-fifth of UCLA’s total enterprise. In 2001–’02, contract and grant revenues rose 17 percent to $767.8 million, enough to keep UCLA among the top five universities nationally for research funding from all sources. And for the first six months of the current fiscal year, funding from these sources is up 6 percent.
The federal government is the dominant source of these awards, accounting for 63 percent of the funding in 2001–’02. In recent years, UCLA has seen an upward trend in federal research support. For example, in the area of science and engineering research, UCLA has gone from 12th in the nation to third between 1997 and 2000, passing Stanford, Harvard, MIT, Michigan and the University of Pennsylvania, among others.
Having a large and successful research program benefits the university’s overall enterprise. “Excellence attracts excellence on all levels,” says Roberto Peccei, vice chancellor for research. “Scholars want to be in the most stimulating and supportive research environment. With ample resources coming in, you can build top-notch facilities and recruit the best graduate students and faculty. And because research grants are competitively awarded, these scholars are receiving external acknowledgment of the quality of their work, further enhancing the university’s reputation.”
UCLA’s success in fund-raising reflects the public’s pride in that reputation. Today, Campaign UCLA, the second comprehensive fund-raising drive in the university’s history, approaches its 2005 conclusion with $2.19 billion already raised toward a final target of $2.4 billion. Only three other American universities, all of them private, have raised more than $2 billion in a campaign.
Like the research program, private giving enjoyed impressive results in 2001–’02; the total of $509.2 million in gifts and pledges set campus and UC records. Thus far in 2002–’03, UCLA is on pace to achieve its year-end goal of $300 million. Raising the bar for consistent philanthropic support is one of the primary reasons for mounting campaigns, says Dennis Slon, associate vice chancellor for development. “The campaign has been important as an organizing principle,” Slon says, “enabling us to make the case for private giving, and to elevate the annual results. Campaign UCLA has effectively tripled the amount of money we raise per year.”
These numbers sound impressive, and indeed they are, but it’s important to understand their actual impact on UCLA’s financial bottom line. Private giving provides only about 4 percent of the university’s $3-billion budget for core activities. Nevertheless, it can help to make the difference between a good university and a great one. “Many of the university’s accomplishments would not have been possible without private funding,” Slon says.
Still, philanthropic dollars often come with restrictions that limit how they can be used by the university. Eight of every 10 dollars raised, in fact, are specifically designated for use by a particular academic unit or for a particular purpose. “That’s not well understood by the Legislature, nor by the general public,” says Slon.
So even though philanthropic giving is an important supplement to the university’s budget and provides necessary support to critical programs, it cannot be viewed as a replacement for revenue shortfalls that might occur elsewhere, such as next year’s anticipated state-budget cut of $24 million. To guarantee that amount year after year, UCLA would have to secure it in perpetuity through an unrestricted endowment that would provide flexibility in how the money is spent. But creating such an unrestricted endowment large enough to fill state funding gaps would indeed present a significant challenge, says Steve Olsen ’77, vice chancellor for finance and budget. As of June 30, 2002, UCLA’s overall campus endowment had a market value of $1.2 billion. To generate $24 million annually with an unrestricted endowment paying 4 percent, Olsen says, would require an additional investment of $600 million.
Slon also points to the need for realistic expectations about how much philanthropic growth is achievable under current economic conditions. “The depressed equity market is having an impact on individual, foundation and corporate giving,” he notes. “A few people have said to us, ‘I’d like to do something for UCLA, but not now.’”
The effects of the battered equity market also are felt in the research arena. “We can expect to see some decline, both in programs that the state funds directly and grants that we compete for,” says Andrew Neighbour, executive director of the Office of Intellectual Property Administration and associate vice chancellor for research. UCLA is absorbing a 10-percent cut to the $20 million it normally receives from the state for organized-research activities such as the ethnic-studies centers, and an additional 10-percent across-the-board cut has been proposed for next year. State-awarded contracts and grants represented a scant 5.3 percent of UCLA’s total research funding in 2001–’02.
Accompanying the decline in corporate philanthropy is a decline in industry sponsorship of research. Only 6.2 percent of UCLA’s research funding in 2001–’02 came from private enterprise, and that proportion is unlikely to increase in the near future. Adding to this problem, Neighbour says, is some companies’ wariness of partnering with academe, “in part because companies don’t have the same leverage over universities that they do over commercial competitors. And some universities have sued companies over infringement of their intellectual-property rights.”
Meanwhile, the available pool for federal contracts and grants is not expected to grow. All of the leading research universities face this constraint, but Neighbour believes that UCLA, as a comprehensive institution with a college, professional schools and an academic medical center on a single campus, is in a better position than most to overcome it. “You can argue that we’re more flexible because we have a broader base of research across a full range of disciplines,” he says.
It’s clear that UCLA needs strong partnerships with the public and private sectors in order to flourish and remain competitive with its peer institutions. Attracting more participation by alumni, who collectively have provided only 20 percent of the campaign’s proceeds, will be integral to achieving that goal. Slon hopes that a variety of programs aimed at engaging alumni in the life of UCLA — from reunions to traditions like Homecoming and Founders’ Day — will inspire greater numbers of graduates to support their alma mater.
In the research arena, the campus will continue to foster collaborative endeavors such as the California NanoSystems Institute, the Center for Embedded Networked Sensing and the Institute for Cell Mimetic Space Exploration, all of which have attracted substantial government grants and interest from private industry. UCLA also is significantly expanding its technology-transfer activities, with the goal of facilitating the process by which faculty bring their research breakthroughs to the marketplace.
“Universities are more actively pursuing technology transfer, in part because we are required to under our sponsored-research agreements, and also because we recognize that commercialization is an effective way to add value to our discoveries and to get the benefits to the public,” Neighbour says. “We also see the potential value to the faculty and to the university in providing alternative revenue streams to support the research enterprise.” Since 2001, the campus is seeing an increase in the numbers of inventions reported, patents and licenses issued and start-up companies created around technologies invented at UCLA. Total licensing revenues have reached $8.4 million per year.
Faculty members have played a key role in the success of Campaign UCLA. Their contribution is most readily seen in the area of programs and research, where the goal has already been exceeded. More than $777 million has been raised in this category, much of it directly by faculty members. In addition, the campaign has provided funding to establish 78 of UCLA’s 188 endowed chairs, each representing a gift of at least $500,000 to support the activities of a distinguished professor. A centuries-old academic tradition, endowed chairs are vital tools for faculty recruitment and retention.
Graduate-student support is an area in which UCLA is losing ground relative to its private peer institutions like Harvard and Stanford. Therefore, fund-raising for this purpose is among the highest priorities of Campaign UCLA and an important avenue to increasing competitiveness. Unfortunately, it is a hard sell to potential donors who may not have received a terminal degree such as a Ph.D.
“The case we’re making is that graduate-fellowship support is crucial to the quality of the undergraduate experience,” says Sion. Graduate students teach undergraduate classes, give lectures on their special areas of expertise and are the most promising future professors as the UC system gears up to recruit 7,000 new faculty members to teach the influx of some 64,000 additional new students projected to enroll by the end of the decade in what is being called Tidal Wave II. To date, Campaign UCLA is at 51 percent of its goal in the category of student support; nearly $138 million has been raised, including $70.7 million for graduate fellowships.
Securing the necessary resources to construct new buildings at UCLA is a shared focus of the research program and the campaign. Observes Neighbour: “A big issue for universities is the cost of facilities as the government wants to do more research of national importance. Who will create the space if the states can no longer carry that burden?” The solution again depends upon public-private partnerships, although non-science buildings, like graduate fellowships, are a tougher sell to potential donors.
Despite the challenges posed by the state and national economies, UCLA continues to enjoy strong public support, engendering widespread optimism about the campus’ future. In partnership with government, industry and individuals, UCLA undoubtedly will remain a competitive force in academe, a magnet to the best minds in the United States and beyond.
