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MacKenzie Scott gifts a financial lifeline for HBCUs | COMMENTARY

MacKenzie Scott has given donations to three Maryland Historically Black Colleges and Universities that will help them build up their endowments.
MacKenzie Scott has given donations to three Maryland Historically Black Colleges and Universities that will help them build up their endowments. (Evan Agostini/Evan Agostini/Invision/AP)

Imagine being one of the chosen ones, told out of the blue that your organization is one of the recipients of the enormous generosity of MacKenzie Scott, the novelist, philanthropist, businesswoman and ex-wife of Amazon CEO Jeff Bezos, whom she helped start the company. You get to share in $4.2 billion given to 384 organizations. We can only imagine the excitement — and the envy it has probably sparked in others.

Among the lucky recipients were three Historically Black Colleges and Universities in Maryland, who collectively split $85 million. Morgan State University received $40 million; Bowie State University, $25 million; and the University of Maryland Eastern Shore, $20 million — the largest gifts each of the institutions had ever received. Ms. Scott also donated generously to several other HBCUs around the country.

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The unprecedented donations give the universities a much needed leg up in the exclusive, and some might go as far as to say elitist, world of college endowments meant to create investment that universities can tap for generations. Typically the principal goes untouched and reinvestment on the earnings is used for scholarships, research programs, professorships, facilities and other university needs. As the American Council on Education wrote in a recent report: “An endowment keeps giving over time.” It can help institutions weather tough economic times, such as today’s pandemic-challenged environment. The bigger the endowment the more a university can do, such as offering more lucrative financial packages to students.

But the size of public and private HBCU school endowments lag behind those of non-HBCUs by at least 70%, according to a 2019 report by the American Council on Education. It’s not that HBCU alumni aren’t charitable. In fact, African Americans tend to donate more of their earnings, some research has found. But they don’t have the same legacy wealth and current earning potential as alumni at Traditionally White Institutions, so the donations aren’t as big; six-figure gifts aren’t commonplace. Non-alumni, such as foundations and corporations, are also less likely to give to HBCUs, sticking instead to established institutions with the greatest name recognition. Unfortunately, that often means institutions with already financially healthy endowments. Even among HBCUs, powerhouses like Howard University, Spelman College and Morehouse College are often the go-tos for donors.

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Ms. Scott’s funding is unique not only for its size, but because it will change the game for lesser known HBCUs.

Morgan, Bowie and UMES have all said they will use their newfound funding largely to boost their endowments. Morgan’s endowment, which University President David Wilson said was $18 million when he arrived at the school about a decade ago, will nearly double; that’s key to his goal of growing the university into one of the “top tier public research universities in the nation devoted to researching issues germane to urban and marginalized communities.” It mostly will be used to seed the university’s first-ever unrestricted endowment fund. Bowie’s endowment was just over $9 million before Ms. Scott’s gift and the president of UMES told delmarvanow.com that the university’s endowed resources will increase from $30 million to about $50 million. It is money the schools could need as the state faces budget cuts and to make up for years of underfunding by the state.

The funding needs of HBCUs have been an issue in Maryland for some time. Alumni of Maryland’s four HBCUs, which also includes Coppin State University, sued the state over the lack of funding to the schools more than a decade ago, and a judge ordered the state to come up with a compensation plan. The Maryland General Assembly, in a decisive vote last session, came to an agreement to pay the schools $580 million over 10 years, and it looked like an end to the 13-year lawsuit was finally in sight. Unfortunately, Gov. Larry Hogan vetoed the legislation, and the General Assembly didn’t override it. A December court deadline was missed, and legislators said they will take up the issue again this coming session.

They’d do well to also look at the distribution of funds within the bill and consider a more equitable allowance. The Coalition for Equity and Excellence in Maryland Higher Education, the group that filed the lawsuit, has said that Coppin and UMES would get too small of a share, which would make it harder for the schools to recover from past inequities. The group has also questioned the criteria for new funds each year.

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It’s beyond time that HBCUs were adequately funded. Ms. Scott’s gift certainly helps, but it doesn’t relieve the state of its responsibility to make up for past wrongs.

The Baltimore Sun editorial board — made up of Opinion Editor Tricia Bishop, Deputy Editor Andrea K. McDaniels and writer Peter Jensen — offers opinions and analysis on news and issues relevant to readers. It is separate from the newsroom.

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