Walton Family Charitable Support Foundation Transfers $300 Million to University

Editors: The gift agreements detailing the transfer of funds will be made available upon request.

FAYETTEVILLE, Ark. - The University of Arkansas has received the entire sum of $300 million that was committed to it by the Walton Family Charitable Support Foundation, as announced by Chancellor John A. White on April 11, 2002. The transfer of funds was made Wednesday, March 12, 2003, entirely in cash.

As a result, the University endowment has increased from $214 million (as of June 30, 2002) to more than $500 million.

Last April, the Foundation’s gift made headlines and history as the largest private contribution ever to be received by an American public university. It retains that status to this day. Of the $300 million, $200 million was committed to establishing an endowing an undergraduate honors college and $100 million was committed to endowing the graduate school.

"When we announced this magnificent gift, we noted that it would transform not only the University of Arkansas but also the entire state of Arkansas," said Chancellor White. "We said we could not find words sufficient to express our gratitude to the Walton Family Charitable Support Foundation for its historic gift commitment.

"At this time, however, we do want to express our thanks over and over again to the Foundation and the Walton Family for making the transfer of $300 million in one lump sum and for executing this significant transaction so quickly," he added. "Also, we want to reiterate our commitment to the Walton Family to utilize the resources they provided to strengthen the state's economy, quality of life, and prospects for the future."

As a condition of receiving the gift, the University had pledged to raise a "match" of $300 million exclusively for academic and academic support purposes. The $300 Million Challenge - as the University’s matching effort is called - is a "campaign" within the larger Campaign for the Twenty-First Century, a $900 million fund raising effort slated for completion by June 30, 2005. As of Feb. 28, $693.7 million had been raised for the Campaign for the Twenty-First Century while $83 million had been raised toward the $300 Million Challenge.

Vice Chancellor for University Advancement G. David Gearhart noted that it is unusual in higher education fund-raising to have gifts of this magnitude transferred all at one time. More often, these exceptionally large gifts are multi-year commitments.

"What this means is that we can apply the full amount of the gift so that we can get maximum effect from it almost immediately," Gearhart said. "As a result, the transformation of the University of Arkansas into a world-class public research university will happen sooner rather than later, which in turn will enable the University to maximize its impact on economic development and quality of life across our entire state."

The funds will be transferred to a newly established foundation, authorized under section 501c(3) of the Internal Revenue Code. The "University of Arkansas, Fayetteville Campus Foundation," as it is called, will hold the entire $300 million and nothing else. The funds will be invested, however, using the same procedures employed by the University of Arkansas Fayetteville campus endowment and The University of Arkansas Foundation, Inc.

The University’s total endowment - as it is reported annually to the National Association of College and University Business Officers - henceforth will reflect funds in all three entities.

Gearhart said that placing the funds in a new foundation would allow the University to track them more easily as well as account for expenditures. It is not unusual for a gift of this size to be placed in a separate foundation, he added.

"We knew the Foundation was eager to make the transfer, and we are glad it has taken place so quickly," Gearhart added. "In anticipation of the transfer, and with the full approval of the Foundation, we began making financial commitments as early as last June, knowing the funds would materialize during the current academic year."

Those early commitments included full scholarships totaling $12,500 per year to 61 exceptional freshmen known as Honors College Fellows. In addition, the University made scholarship commitments of $4,000 per year to 74 outstanding freshmen designated as Honors College Academy Scholars. Also, the University established 41 Distinguished Doctoral Fellowships and 209 Doctoral Academy Fellowships to be awarded to outstanding graduate students who enter next fall. Those students are currently being recruited.

As announced last April, the $300 million will be distributed as follows:

Honors College: $200 million:

• For student support, $113 million
• For faculty support, $58 million
• For library and technology support, $29 million

The Graduate School, $100 million:

• For student support, $64 million
• For graduate research faculty chairs, $24 million
• For library and graduate student research support, $12 million