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Post by Pakachoag Phreek on Sept 26, 2019 14:22:48 GMT -5
0.3 percent.
From $783.2M to $785.9M.
The audited financial statement for fiscal year 2019 was published yesterday.
Net assets increased to $1,037M from $1,027M, or about one percent.
The investment return was cut in half to about $26 million. This did not fully pay for the endowment monies that were released to help pay the cost of operating the college. Which, in part, explains the minuscule growth in endowment value.
No HE with these sort of numbers.
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Post by matunuck on Sept 26, 2019 14:58:58 GMT -5
Hockey East for the men. Women already in.
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Post by hchoops on Sept 26, 2019 15:02:01 GMT -5
0.3 percent. From $783.2M to $785.9M. The audited financial statement for fiscal year 2019 was published yesterday. Net assets increased to $1,037M from $1,027M, or about one percent. The investment return was cut in half to about $26 million. This did not fully pay for the endowment monies that were released to help pay the cost of operating the college. Which, in part, explains the minuscule growth in endowment value. No HE with these sort of numbers. Do you enjoy posting negative news about HC ?
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Post by longsuffering on Sept 26, 2019 15:53:07 GMT -5
This news is neither negative or positive just factual. The endowment had a higher investment return than 0.3% but money has to be paid out of the endowment to subsidize the operating costs of the college.
To me it is a reminder that the building boom can't go on forever because each new building has to be heated, cooled, insured, regularly maintained and staffed and tuition doesn't cover all the current operating costs of the college. Although the new "Jo" should be less costly to maintain than the old fieldhouse.
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Post by hcgrad94 on Sept 26, 2019 16:02:46 GMT -5
0.3 percent. From $783.2M to $785.9M. The audited financial statement for fiscal year 2019 was published yesterday. Net assets increased to $1,037M from $1,027M, or about one percent. The investment return was cut in half to about $26 million. This did not fully pay for the endowment monies that were released to help pay the cost of operating the college. Which, in part, explains the minuscule growth in endowment value. No HE with these sort of numbers. Not quite sure you understand endowment as it relates to the budget and HE as I have read this statement before. The vast majority (95% or so) of endowment spending is restricted for scholarship, professorships etc. Therefore it's not as if having more endowment just creates more free cash for the college. ________________________________^ If you could explain why you think there is a correlation between the size of the Holy Cross endowment and the college's Financial flexibility to join a new Hockey League I would love to hear it.
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Post by Pakachoag Phreek on Sept 26, 2019 16:28:20 GMT -5
0.3 percent. From $783.2M to $785.9M. The audited financial statement for fiscal year 2019 was published yesterday. Net assets increased to $1,037M from $1,027M, or about one percent. The investment return was cut in half to about $26 million. This did not fully pay for the endowment monies that were released to help pay the cost of operating the college. Which, in part, explains the minuscule growth in endowment value. No HE with these sort of numbers. Do you enjoy playing negative news about HC ? The S&P average over the same 12 months grew by over 8 percent, or about 25x what the HC endowment grew. If the men's hoops coach posted a W-L record of 3-27, would you expect that to be described as a good year? This past fiscal year, the college came very close to de-capitalizing a small part of the endowment to help fund the operations of the college. That is not a good thing, but it sometimes happens, such as when the markets have a terrible year. I checked whether any other school's financial statement has been posted for FY 2019; HC is one of the very first, so little to compare to. That said, MIT's endowment grew by about 8.8 percent, or $1.040 billion. University of Pennsylvania grew by 6.5 percent; Dartmouth 7.5 percent; Penn State 7.7 percent; University of California system by 8.2 percent. From Bloomberg this afternoon.
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Post by KY Crusader 75 on Sept 26, 2019 16:40:36 GMT -5
Do you enjoy playing negative news about HC ? The S&P average over the same 12 months grew by over 8 percent, or about 25x what the HC endowment grew. If the men's hoops coach posted a W-L record of 3-27, would you expect that to be described as a good year? This past fiscal year, the college came very close to de-capitalizing a small part of the endowment to help fund the operations of the college. That is not a good thing, but it sometimes happens, such as when the markets have a terrible year. I checked whether any other school's financial statement has been posted for FY 2019; HC is one of the very first, so little to compare to. That said, MIT's endowment grew by about 8.8 percent, or $1.040 billion. University of Pennsylvania grew by 6.5 percent; Dartmouth 7.5 percent; Penn State 7.7 percent; University of California system by 8.2 percent. From Bloomberg this afternoon. Of course you know you are not being fair. The change in the HC endowment from year to year is due to (1) contributions to the endowment; (2) growth/loss on endowment assets, AND (3) withdrawals from the endowment for use in ongoing operations or special projects. I'm not saying the managers did a great job (I'm on record as suggesting all such funds be put in index funds) but, rather, that you're not looking at the fell equation. Of course, you know that My own endowment (401K, IRA, etc) outgrew the S & P for many years as I added $$$ to it and took nothing out. Now I am retired and taking $$$ out, so I don't think I'll keep up with the S &P; but that doesn't mean that I'm a poor money manager
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Post by Pakachoag Phreek on Sept 26, 2019 16:54:12 GMT -5
0.3 percent. From $783.2M to $785.9M. The audited financial statement for fiscal year 2019 was published yesterday. Net assets increased to $1,037M from $1,027M, or about one percent. The investment return was cut in half to about $26 million. This did not fully pay for the endowment monies that were released to help pay the cost of operating the college. Which, in part, explains the minuscule growth in endowment value. No HE with these sort of numbers. Not quite sure you understand endowment as it relates to the budget and HE as I have read this statement before. The vast majority (95% or so) of endowment spending is restricted for scholarship, professorships etc. Therefore it's not as if having more endowment just creates more free cash for the college. ________________________________^ If you could explain why you think there is a correlation between the size of the Holy Cross endowment and the college's Financial flexibility to join a new Hockey League I would love to hear it. $362 million of the endowment is not donor restricted, meaning 54 percent of the endowment's value is donor restricted. That is not the 'vast majority' of the endowment monies. As for Hockey East, Holy Cross uses a three year rolling average with a one year lag to distribute endowment monies for the operation of the college,. The annual distribution is 4.5 percent of the endowment value, as calculated by the three year rolling average. This year's value (2019) is not included in the three year rolling average for fiscal 2020. However, the three year rolling average for fiscal 2021 will be based on the endowment's value for fiscal 2017, 2018, and 2019; these last two years being essentially flat.
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Post by Pakachoag Phreek on Sept 26, 2019 17:13:41 GMT -5
The S&P average over the same 12 months grew by over 8 percent, or about 25x what the HC endowment grew. If the men's hoops coach posted a W-L record of 3-27, would you expect that to be described as a good year? This past fiscal year, the college came very close to de-capitalizing a small part of the endowment to help fund the operations of the college. That is not a good thing, but it sometimes happens, such as when the markets have a terrible year. I checked whether any other school's financial statement has been posted for FY 2019; HC is one of the very first, so little to compare to. That said, MIT's endowment grew by about 8.8 percent, or $1.040 billion. University of Pennsylvania grew by 6.5 percent; Dartmouth 7.5 percent; Penn State 7.7 percent; University of California system by 8.2 percent. From Bloomberg this afternoon. Of course you know you are not being fair. The change in the HC endowment from year to year is due to (1) contributions to the endowment; (2) growth/loss on endowment assets, AND (3) withdrawals from the endowment for use in ongoing operations or special projects. I'm not saying the managers did a great job (I'm on record as suggesting all such funds be put in index funds) but, rather, that you're not looking at the fell equation. Of course, you know that As for being fair, (1) contributions to the endowment; $5.343M (2) growth/loss on endowment assets, + $26.215M AND (3) withdrawals from the endowment for use in ongoing operations or special projects. $30.414MFor fiscal 2021, the three year rolling average for the endowment will be $772 million. A 4.5 percent distribution will provide $34.7 million in endowment monies in 2021 for the operations of the college, or $4.3 million more than in fiscal 2019. You might think that's pretty good, but the college's fin aid increased by $4.5 million between fiscal 2018 and 2019.
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Post by KY Crusader 75 on Sept 26, 2019 19:19:21 GMT -5
I haven't stated that I think the return is pretty good, but I do appreciate your providing the addl info we needed to put the return in perspective
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Post by crusader12 on Sept 27, 2019 7:43:05 GMT -5
Am I in error or does the HC endowment always appear to underperform? No error you are correct.
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Post by matunuck on Sept 27, 2019 9:19:35 GMT -5
This news is neither negative or positive just factual. The endowment had a higher investment return than 0.3% but money has to be paid out of the endowment to subsidize the operating costs of the college. To me it is a reminder that the building boom can't go on forever because each new building has to be heated, cooled, insured, regularly maintained and staffed and tuition doesn't cover all the current operating costs of the college. Although the new "Jo" should be less costly to maintain than the old fieldhouse. No, the number is factual; the comment on HE is opinion whether one agrees or disagrees with it.
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Post by Pakachoag Phreek on Sept 28, 2019 4:56:13 GMT -5
In reviewing the financial statement, the college had made great strides in recent years in reducing unfunded pension liabilities [accrued pension obligation] to nearly $0. In 2019, the unfunded pension liability rose to about $9 million. This is not bad, in and of itself, but as residents of New Jersey or Illinois know, this can become an enormous problem if unfunded pension liabilities accumulate, over time, to unsustainable levels.
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Post by hc6774 on Sept 28, 2019 8:57:38 GMT -5
I am struck by the numerical symmetry or the current endowment and the endowment 50 years ago. Then it hovered at about $7.8M and the sustainability of the college was a major concern. A new president and new BoT embarked on a campaign to run balanced annual budgets and vigorous fund raising activities.
This is probably an unanswerable question... but are we in a similar time ?
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Post by rgs318 on Sept 28, 2019 8:58:31 GMT -5
I hope not.
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Post by KY Crusader 75 on Sept 28, 2019 9:57:24 GMT -5
I am struck by the numerical symmetry or the current endowment and the endowment 50 years ago. Then it hovered at about $7.8M and the sustainability of the college was a major concern. A new president and new BoT embarked on a campaign to run balanced annual budgets and vigorous fund raising activities. This is probably an unanswerable question... but are we in a similar time ? Holy Cross is typically #130 or #135 among all endowments among the 1,000+ colleges in the country. If you looked at endowment/student HC is likely top 100. While it would be great to crack the top 100 overall and/or hit the billion dollar level, HC is in solid shape financially.
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Post by Pakachoag Phreek on Sept 28, 2019 16:24:31 GMT -5
HC is still in a good position financially. Its long term debt is $159 million. As of June 2018, BC's long term debt was $1.1 billion. So HC's principal and interest payments on the debt are certainly manageable.
IMO, the largest problem is the stagnant endowment, which has underperformed generally for years, and is largely flat for the past three. When the endowment is basically giving you a beer budget, your champagne tastes won't be realized.
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Post by matunuck on Sept 29, 2019 8:45:19 GMT -5
PP, would say the HC endowment generally underperforms even under a longer time frame compared to the others?
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Post by joutsHC77 on Sept 29, 2019 11:42:09 GMT -5
HC is still in a good position financially. Its long term debt is $159 million. As of June 2018, BC's long term debt was $1.1 billion. So HC's principal and interest payments on the debt are certainly manageable. IMO, the largest problem is the stagnant endowment, which has underperformed generally for years, and is largely flat for the past three. When the endowment is basically giving you a beer budget, your champagne tastes won't be realized. Why doesn’t HC change investment managers if this is the case, poor investment performance?
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Post by sader1970 on Sept 29, 2019 12:45:22 GMT -5
Guess who is the highest paid person atop Mt. St. James? He's not in the athletic department.
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Post by matunuck on Sept 30, 2019 9:44:32 GMT -5
I am struck by the numerical symmetry or the current endowment and the endowment 50 years ago. Then it hovered at about $7.8M and the sustainability of the college was a major concern. A new president and new BoT embarked on a campaign to run balanced annual budgets and vigorous fund raising activities. This is probably an unanswerable question... but are we in a similar time ? Schools like HC will get into trouble should the market at any point decide that the value of a Holy Cross degree is less than the cost of receiving that degree.
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Post by Pakachoag Phreek on Sept 30, 2019 14:33:42 GMT -5
PP, would say the HC endowment generally underperforms even under a longer time frame compared to the others? Probably not, if the timeframe is 1970-2020. HC is a small enrollment school, and to my limited knowledge, over that time there have no mega-gifts to the endowment during those 50 years (>$10 million from a single donor.). The mega gifts have gone to facilities. And yet, HC is still comfortably in second place (to Notre Dame) when measuring endowment $ per student., among all Catholic colleges and universities. That strikes me as HC having made some wise investment decisions in the past to achieve second spot on the pinnacle. Gifts to the endowment total $32.7M for the four fiscal years of 2016-19. I don't know where the capital campaign stood on June 30, 2015, it was $240 million in June 2016, and $385 million in June 2019.. Much of the money raised is paying for four new buildings (about $250 million) which should leave about $150 million for the endowment. Some of this money may be temporarily squirreled away, and some may be pledged contributions not yet received. IIRC, HC70 said he was a forensic accountant, but he is likely not available / interested in pursuing this. :-)
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Post by Pakachoag Phreek on Sept 30, 2019 17:56:26 GMT -5
More endowment reports: Harvard 4.3% ( 6.5% return on investments) Bowdoin 10.9% to $1.74 billion Yale 5.7% Duke 6.9% Brown 12.4% _____________________ From the Hartford Business Journal. Endowment growth 2009 to 2018. Holy Cross endowment growth from 2009 ($492.7M) to 2019 ($785.6M) is about 60 percent. Unless one of the CT schools has negative endowment growth in 2019, HC would again be low school on the totem if it was in Connecticut. Note that Wesleyan's endowment in 2009 was less than HC's. If Wesleyan's endowment total in 2018 had been matched by HC in 2019, that could have been the basis for an additional $12.6 million of endowment monies to fund HC operations. (<< The calculation is oversimplified a bit.)
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Post by matunuck on Sept 30, 2019 19:11:03 GMT -5
PP, HC has plowed significant sums into facilities, not its endowment, over that period, no?
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Post by longsuffering on Oct 1, 2019 0:35:48 GMT -5
I am struck by the numerical symmetry or the current endowment and the endowment 50 years ago. Then it hovered at about $7.8M and the sustainability of the college was a major concern. A new president and new BoT embarked on a campaign to run balanced annual budgets and vigorous fund raising activities. This is probably an unanswerable question... but are we in a similar time ? In 1969 higher education was in a growth spurt with the baby boomers reaching college age. In 2019 some colleges are closing. In 1969 HC tuition might have been around 10-15% of an average middle class family annual income. In 2019 it is probably around 40-60% of an average middle class family annual income.
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