At its monthly meeting Thursday on the University’s Flint campus, the Board of Regents will receive an updated report on the University’s investment portfolio, including details on the state of the University’s endowment.
The report, submitted by Timothy Slottow, the University’s executive vice president and chief financial officer, will outline the University’s financial performance for the last fiscal year — which ended on June 30.
The endowment, which is made up of litany of stocks and other assets, was valued at $6.5 billion as of Dec. 31. Through its payout, the endowment funds financial aid programs, academic departments and many of the other necessary operations of the University.
At last October’s Regents meeting, the endowment was reported to be valued at $7.6 billion, which was a 6.4 percent increase from its previous fiscal year.
But with colleges around the country posting record declines in their endowments, it is unclear how much the University of Michigan’s endowment was damaged by the economic downturn.
Harvard University’s endowment suffered a 27 percent loss over its last fiscal year and Yale University’s, endowment dropped by about 30 percent in value. The University of Virginia, suffered a 21 percent loss in its endowment.
A decline in the endowment would be the first in a while for the University. The last annual loss in investment returns for the endowment was the 2002 fiscal year, when the fund lost 6.59 percent of its value.
To protect the endowment from instability in the market, University officials calculate the value for the endowment’s payout based on a seven-year rolling average — meaning that they average together the value of the endowment for every year over the last seven years in their calculations. This helps to guard against volatile ups and downs in the market, like the ones felt over the past year with the economic downturn.
The report on the endowment is traditionally given at the October regents meeting. But unlike nearly all other documents that are slated to be discussed at regents meetings, which are almost always released on the Monday before a regents meeting, the University will not publicly disclose the report until the meeting.
University spokesman Rick Fitzgerald said though the numbers are prepared in advance of Thursday’s meeting, traditionally the University has not released the figures publicly until the meeting.
Two new construction projects
The regents will also consider two new construction projects on campus at the meeting.
The first project will replace the Central Power Plant’s existing water treatment system. Expected to cost $2.6 million, the project will replace water demineralizers with reverse osmosis units and will increase system capacity. The project is expected to lead to increased energy efficiency at the power plant, and if approved, is expected to be finished by the winter of 2011.
The second project would update the Administration Services Building electrical feed, build a 650-square-foot enclosure and install a new substation for the building. If approved, construction on the project is projected to be finished fall of 2010. That work is estimated to cost $2 million.
Three more lawsuits on litigation report
The regents will receive their monthly litigation update at the meeting Thursday. In the last month, three new lawsuits have been filed against the University.
According to the litigation report released yesterday, Andrei Borisov — a researcher at the Medical School until last September — has charged the University with defamation, assault and battery, false imprisonment, interference with a contract, fraud and malicious prosecution.
Last year, Borisov alleged scientific misconduct, claiming his work had been plagiarized and misrepresented in an attempt to secure grant money from federal agencies.
As stated in the regents’ litigation report, Borisov claims that he was arrested by University Police following a meeting with his supervisor and that he was detained in a jail cell at the Department of Public Safety on charges of trespassing and resisting arrest. Borisov was acquitted of all charges in April of this year.
After the acquittal, Borisov said he was told he was ineligible for rehire at the University because of his prior arrest.
Asked about the ongoing situation at last month’s meeting, University President Mary Sue Coleman said she would not comment on the matter.
The other two lawsuits were brought by students at the University’s Dearborn and Flint campuses. A lawsuit by former Dearborn campus student Mary Lee seeks $2 million after she was expelled for an apparent violation of the Student Code of Conduct. The other suit, being brought by Stephen Tripodi, a student at the University’s Flint campus, seeks more than $40 million for alleged gender discrimination by the University.