Columbia needs money. While most of the college’s funds come from tuition, which is set to rise by 3.3 percent in the fall, philanthropy can also help alleviate the current $1.5 million deficit. But a departed chief fundraiser  and a sweeping out of his staff put Columbia’s ability to bring in the big bucks on pause. 

Patrick Sheahan, former vice president of Institutional Advancement, the department charged with fundraising, left the college Jan. 27 after only four months on the job. Less than three months later, half of the employees in the Office of Institutional Advancement were fired, making the fate of the college’s ability to raise money uncertain. 

The college’s tax forms show that it has the ability to attract donors through fundraising events but does so with high overhead—in recent years, it spent approximately $1 for every $3 it made. President and CEO Kwang-Wu Kim said the college will shift focus away from event planning and toward raising money from independent donors, which he said will become his priority during his second year in office. 

In the past, the college has been too reliant on staging events and has not put enough effort into hands-on fundraising, Kim said. 

Kim said event planning can be counterproductive because it’s  geared more toward introducing people to an institution—not actually raising money.

“The challenge with events is unless they’re very strategic and targeted, they don’t lead to anything,” Kim said. “Too many events and not enough fundraising is actually a net negative because it is costing money.”

Kim said he is working on restructuring the Office of Institutional Advancement into the recently announced Department of Development, which will focus on overall fundraising and the related area of alumni relations, both of which need more attention, he said.

“Right now [the college] needs to focus on raising money,” Kim said. “I decided to concentrate the work into [the] two areas. [Fundraising and alumni relations] are the two greatest needs—people with those skill sets.”

The college is currently in the midst of a national search for a new vice president of Development to head the new department, Kim said, adding that he hopes to fill the position no later than the middle of the fall 2014 semester. As for the vacancies in the Department of Development, Kim said the college will only fill necessary positions.

“Colleges exist in order to provide education for students,” Kim said. “We don’t exist to give people jobs. Unless people are truly helping an institution to advance in its mission, there is no reason for them to be in this institution.”

Columbia generated approximately $8 million in net fundraising during the 2011–2012 academic year, according to its 990 tax forms for that year. All nonprofits are required to file 990 tax forms with the IRS that become public 18 months after they are filed. 

That was an increase in its contributions from the 2010–2011 academic year, during which Columbia generated an approximate net sum of $5.9 million. The college also spent approximately $300,000 less on fundraising efforts in 2011 than in 2010, according to the forms. In 2011, the college had approximately $3.7 million in expenses compared to $4 million in 2010.

Richard Dowsek, the college’s interim CFO who has experience with performance art nonprofits, said the college’s expenses are slightly higher than he is used to seeing. He said Columbia should have raised almost twice as much, close to $20 million, and should be generating funds at a ratio of $5 or $6 earned for every $1 spent, not the current $3 earned for every $1 spent. 

The increase in net gain comes at a time when the endowment fund is seeing a general increase. The endowment reached approximately $112.3 million, a 27 percent increase from its 2008 value of $88.5 million, showcasing the increase in net gain from fundraising.

Fundraising events have been a lucrative venture for the college but only generate a small portion of Columbia’s overall revenue. In 2010, Columbia generated $86,026 from four events, including the annual Open Doors Gala and the Museum of Contemporary Photography benefits. In 2011, the college was able to generate $457,507—five times as much—from five different events.  

However, fundraising comes at a cost. The college’s largest fundraising expense comes from the salaries and wages of  fundraising employees, which totaled $1.77 million in 2011. Other notable fundraising expenses include $217,730 spent on conferences—a 38.5 percent decrease in spending from the previous year—and $169,450 in travel expenses—a 13 percent increase from the year before. 

The amount spent on wages and salaries seems high, Dowsek said. 

“If you are going to spend $3.7 million, you should raise more than $11.8 million,” Dowsek said. 

Compared to other institutions, Columbia seems to be attracting more contributions and donations than other art colleges, but significantly less than private colleges that offer a more traditional curriculum.

Northwestern University announced March 14 that it would attempt to raise $3.75 billion for its We Will. The Campaign for Northwestern fundraising campaign. The campaign is the largest in the University’s history and has received $1.52 billion so far, according to a March 14 press release from Northwestern.

Northwestern generated approximately $229.5 million from fundraising in 2011, according to its 2011 tax forms, overshadowing Columbia’s $8 million net gain. Unlike Columbia, Northwestern was able to generate approximately $1.23 million from seven fundraising events, helping to bulk up its $5.5 billion endowment fund. 

Northwestern generates $7 for every $1 spent, a figure that surpasses Columbia’s $3 generated for every $1 ratio—and Dowsek’s desired $6 projections.

DePaul University also attracted more contributions than Columbia, which is reflected in DePaul’s $349.2 million endowment fund. DePaul generated $43.7 million in 2011 despite its approximately $14.8 million in expenses that were much higher than Columbia’s. 

The Pratt Institute, located in Brooklyn, N.Y., has a similar curriculum to Columbia’s. It generated $6.4 million in contributions and fundraising and has an endowment of $97.6 million. However, Pratt is more frugal with its fundraising expenditures. Pratt spends approximately $1.4 million on compensation but only $3,469 on conference costs and $41,963 on travel.

The Ringling College of Art and Design, located in Sarasota, Fla., has an endowment of $26.6 million but still raised $7.2 million during the 2011 academic year, according to its 990 forms. Like Columbia, Ringling’s fundraising expenses are mostly comprised of compensation, $711,370, conference costs, $105,726, and travel costs, $50,928. 

The Rhode Island School of Design, located in Providence, R.I., has an endowment that surpasses Columbia’s—RISD’s is $283.5 million—but the school generated less fundraising and contributions than Columbia. RISD received $5.4 million from its efforts, according to its 990 tax forms. RISD spent less on wages, though—$1.4 million—and only $75,417 on travel costs. It reported that it spent nothing on conference costs.

Senior Vice President Warren Chapman has been overseeing the Department of Development as the college makes the transition from the old Institutional Advancement model. He said technology and online donations generate approximately $348 million a year for nonprofits and that the new VP will have to examine the trend because it may become important in the college’s mission to increase its fundraising ability. 

Chapman also said the world of philanthropy is experiencing a shift in who is donating to nonprofits, such as institutions of higher education. Chapman said there is a $3 trillion shift in wealth occurring between older generations and younger generations, which may impact the kind of nonprofits new wealth would support. 

“The difference is that you will have younger people who are probably for the first time becoming involved in providing support for nonprofit institutions,” Chapman said. “Fundraising becomes a marketing process. You have to think about it in a traditional and nontraditional sense now.”

Kim said the college is seeking a vice president who will be able to lead the Department of Development in generating more annual donations, scholarship contributions and large-scale capital fundraising. The campaign is dedicated to specific goals such as renovating The Johnson Publishing Building, 820 S. Michigan Ave., the site of the college’s scrapped library. 

The administration canceled the project because of a lack of funding. Kim said the college is also in need of unrestricted funds, money donated to the college that is not earmarked for a specific purpose. 

“Real development work is on a continuum where you start with the smaller gifts that are sort of easy, and you hopefully move them to a stage where they feel a sense of commitment to the institution, and then at the capital level, they are making gifts because they want to transform the institution,” Kim said. 

Fundraising is an essential part of operating a successful nonprofit, according to Dowsek. He said it could alleviate some of the financial burden on students.

“As the college looks ahead, developing higher amounts of net contributed income is really important,” Dowsek said. “It’s one of the release valves for tuition increases and affordability. Stay tuned, it’s going to get better fast.” 

Despite the college’s larger fundraising expenses and inability to generate funds the way universities such as Northwestern and DePaul do, Kim said he is not concerned about fundraising. He said the college has identified the problem and is working to fix it.

Kim said he plans to improve his presence outside of the campus to help increase funding and donations, especially larger donations. He also said he has spent most of his time filling job positions.

“Any successful college always has a president that puts himself out there,” Kim said. “That’s one of the expectations of a president: getting out into a larger world and attracting resources, primarily money.”

“Colleges exist in order to provide education for students,” Kim said. “We don’t exist to give people jobs. Unless people are truly helping an institution to advance in its mission, there is no reason for them to be in this institution.”

Columbia generated approximately $8 million in net fundraising during the 2011–2012 academic year, according to its 990 tax forms for that year. All nonprofits are required to file 990 tax forms with the IRS that become public 18 months after they are filed. 

Columbia saw an increase in its contributions from the 2010–2011 academic year, during which the college generated an approximate net sum of $5.9 million. The college also spent approximately $300,000 less on fundraising efforts in 2011 than in 2010, according to the forms. In 2011, the college spent approximately $3.7 million on fundraising.

Richard Dowsek, the college’s interim CFO, who has previous experience with performing art nonprofits, said the college’s expenses are slightly higher than he is used to. He said Columbia should have raised almost twice as much, close to $20 million, and should be generating funds at a ratio of $5 or $6 earned for every $1 spent, not the current $3 earned for every $1 spent. 

The increase in net gain comes at a time when the endowment fund is seeing an overall increase. The endowment reached approximately $112.3 million, a 27 percent increase from its 2008 value of $88.5 million, showcasing the increase in net gain from fundraising.

Fundraising events have been a lucrative outlet for the college but only generate a small portion of Columbia’s overall revenue. In 2010, Columbia generated $86,026 from four events, including the annual Open Doors Gala and the Museum of Contemporary Photography benefit. In 2011, the college was able to generate $457,507—five times as much—from five different events. 

However, fundraising comes at a cost. The college’s largest fundraising expense comes from the salaries and wages of  fundraising employees, which totaled $1.77 million in 2011. Other notable fundraising expenses include $217,730 spent on conferences—a 38.5 percent decrease in spending from the previous year—and $169,450 in travel expenses—a 13 percent increase from the previous year. 

Dowsek said the amount spent on wages and salaries seems high. 

“If you are going to spend $3.7 million, you should raise more than $11.8 million,” Dowsek said. 

Columbia seems to be attracting more contributions and donations than other arts colleges, but significantly less than private universities that have professional, law, medical and business schools.

Northwestern University announced March 14 that it would attempt to raise $3.75 billion for a campaign called “We Will: The Campaign for Northwestern.” The capital campaign is the largest in the university’s history and has received $1.52 billion so far, according to a March 14 Northwestern press release.

Northwestern generated approximately $229.5 million from fundraising in 2011, according to its 2011 tax forms, dwarfing  Columbia’s $8 million net gain. Unlike Columbia, Northwestern was able to generate approximately $1.23 million from seven fundraising events, helping to bulk up its $5.5 billion endowment fund. 

Northwestern generates $7 for every $1 spent, a figure that vastly surpasses Columbia’s $3 to $1 ratio—and Dowsek’s desired $6 projections.

DePaul University also attracted more contributions than Columbia, reflected in DePaul’s $349.2 million endowment fund. DePaul generated $43.7 million in 2011 despite its approximately $14.8 million in expenses, much higher than Columbia’s. 

The Pratt Institute, located in Brooklyn, N.Y., has a concentration in architecture, art and design. It generated $6.4 million in contributions and fundraising and has an endowment of $97.6 million. However, Pratt is frugal with its fundraising expenditures. Pratt spends approximately $1.4 million on compensation but only $3,469 on conference costs and $41,963 on travel.

The Ringling College of Art and Design, located in Sarasota, Fla., has an endowment of $26.6 million but still raised $7.2 million during the 2011 academic year, according to its 990 forms. Like Columbia, Ringling’s fundraising expenses are mostly composed of compensation, $711,370, conference costs, $105,726, and travel costs, $50,928. Ringling earns $6.62 for every $1 spent.

The Rhode Island School of Design, located in Providence, R.I., has an endowment that surpasses Columbia’s—RISD’s is $283.5 million—but the school generated less fundraising and contributions than Columbia. RISD received $5.4 million from its efforts, according to its 990 tax forms. RISD spent less on wages, though—$1.4 million—and only $75,417 on travel costs. 

Senior Vice President Warren Chapman has been overseeing the Department of Development as the college makes the transition from the old Institutional Advancement model. He said online donations generate approximately $348 million a year for nonprofits and the new VP of Development will have to examine the trend because it may become important for the college to increase its fundraising ability. 

Chapman said philanthropy is experiencing a shift. There is a $3 trillion transfer in wealth occurring between older and younger generations, Chapman said, which may mean a different distribution of funding for nonprofits. 

“The difference is that you will have younger people who are probably for the first time becoming involved in providing support for nonprofit institutions,” Chapman said. “Fundraising becomes a marketing process. You have to think about it in a traditional and nontraditional sense now.”

Kim said the college is seeking a VP who will lead the Department of Development in generating more annual donations, scholarship contributions and large-scale capital fundraising for projects dedicated to specific goals such as renovating The Johnson Publishing Building, 820 S. Michigan Ave., the site of the college’s scrapped library. The administration canceled the project because of a lack of funding. 

Kim said the college is also in need of unrestricted funds, money donated to the college that is not earmarked for a specific purpose.

“Real development work is on a continuum where you start with the smaller gifts that are sort of easy, and you hopefully move them to a stage where they feel a sense of commitment to the institution, and then at the capital level, they are making gifts because they want to transform the institution,” Kim said. 

Fundraising is an essential part of operating a successful nonprofit, according to Dowsek. He said it could alleviate some of the financial burden on students.

“As the college looks ahead,developing higher amounts of net-contributed income is really important,” Dowsek said. “It’s one of the release valves for tuition increases and affordability. Stay tuned. It’s going to get better fast.” 

Despite the college’s larger fundraising expenses and inability to generate funds the way universities such as Northwestern and DePaul do, Kim said he is not concerned about fundraising. He said the college has identified the problem and is working to fix it.