Endowment challenge program-state funds inviolate.

14LSO-0105.C1

FISCAL NOTE

The fiscal impact, in the form of decreased investment income distributions to the University of Wyoming (UW) from the UW Foundation, is indeterminable.

There are approximately 550 donor accounts with like accounts of state matching funds for endowments. If the values of the investments stay above the original values of the gifts, then there would be no non-administrative or administrative fiscal impact.  If the values of the investments drop below the original values of the gifts, then no distributions would be made. This would result in a reduction in funds distributed to UW of about $3.7 million annually. 

Note: This bill would not require that the provisions of the draft legislation be applied to all endowment funds. However, the UW Foundation has determined, and the University agrees, that endowment donors should be treated identically to the way in which state endowment funds are treated.  Since the state endowment match represents approximately 25% of the total UW Foundation endowment, if the values of the investments drop below the original values of the gifts, the reduction in funds distributed to UW would be about $14.8 million annually ($3.7 million X 4).  In some cases under this circumstance, UW would have to redirect other revenue to meet endowment commitments that are required to be funded, e.g. payments for endowed faculty.

Prepared by:   Dean Temte, LSO       Phone: 777-7881

(Information provided by Chris Boswell, UW; 307-766-2238)