Mega-Donors Rarely Support Historically Black Colleges. Will This Gift Change That?

While every week seems to bring news of yet another mega-gift flowing to an American university, few such gifts have made their way to historically black colleges or universities (HBCU). Here’s hoping Ronda Stryker and William Johnston’s recent $30 million gift to Atlanta’s Spelman College marks an inflection point in which HBCUs begin to reap some of benefits of the higher ed fundraising boom.

The gift, the largest from living donors in the college’s 137-year history, is earmarked to build the Center for Innovation & the Arts (CI&A), the college’s first new academic facility since 1996. (Spelman received its largest bequest in 1992, a $37 million gift from the estate of Readers Digest founder DeWitt Wallace.)

The $86 million CI&A project received its first support from Leonard and Louise Riggio in 2016. As I noted at the time, the center found the college merging the liberal arts with in-demand STEM competencies. Needless to say, this strategy resonated with Stryker.

“Spelman alumnae are leaders across every field imaginable, breaking new ground while tackling some of the world's most challenging issues from health disparities to the digital divide,” Ronda Stryker said in the release. “We are thrilled to support a building that will encourage students to master technology, innovation and the arts.”

I’ll take a closer look at the challenges facing HBCUs and why this gift is so significant in a moment. But first, let’s meet the donors.

Giving for “Social Responsibility”

Stryker is a director of the medical equipment company Stryker Corp., which was founded by her grandfather, Homer Stryker. She inherited a stake in Stryker Corp. from her parents and is the only one of her siblings to serve on the board. The public company’s 2017 revenue stood at $12.44 billion.

With a net worth of roughly $5.3 billion, the 64-year-old Stryker was number 114 on the 2018 Forbes 400 List of Richest Americans. Jon Stryker, Ronda’s younger brother, has an estimated worth of $3.1 billion, and has emerged as one of philanthropy’s foremost supporters of LGBTQ and environmental causes through his Arcus Foundation. The third Stryker sibling, Pat, is the founder of Bohemian Foundation, which supports music, the arts and civic programs. She’s also a longtime player in Colorado progressive circles, and along with Jon, a major donor to Democratic super PACs. Her net worth stands at $3.6 billion.

In 2016, Jon and Pat gave a combined $10 million to fund the nation's first memorial to the victims of racial terror lynchings.

Ronda Stryker is also vice chair and director of Greenleaf Trust, an investment bank chaired by her husband William, who serves as trustee of Western Michigan University as well as the Genevieve and Donald S. Gilmore Foundation. She has been a trustee of Spelman since 1997, and currently serves as the vice chair of the Spelman College Board of Trustees and chair of the Board’s Arts, Innovation & Technology Committee. Stryker taught special education at Kalamazoo Public Schools in Michigan, and in 2013, received a lifetime achievement award for her work as a role model for women.

Her bio on the Stryker Corp. website reads: “Ms. Stryker brings a strong interest in advocating the benefits of diversity and various matters regarding social responsibility.” The same can be said for her philanthropy (and that of her siblings, for that matter).

In 2011, she and her husband gave $100 million to create a new Homer Stryker medical school at Western Michigan University, where she got her Masters degree in the Arts. In 2016, the couple pledged $20 million to the Harvard Medical School Department of Global Health and Social Medicine to support equitable health care.

Stryker’s family helped fund previous Spelman projects, including the Gordon-Zeto Center for Global Education, which funded expansion and ongoing operation of the college’s study abroad program. The family has also given to the Spelman College Museum of Fine Arts, science initiatives, summer internships, the Annual Fund, the President’s Safety Net Fund, and renovations to Sisters Chapel and the Wellness Center at Read Hall.

A Rare HBCU Mega-Gift

Stryker and Johnston’s gift underscores a peculiar dichotomy across the higher ed giving landscape.

In 2017, universities raised over $43 billion. Regional philanthropy is surging. High ed donors across the board remain committed to boosting access and reducing economic barriers to college. And mega-donors like Michael Bloomberg and Ronald Perelman recently made massive gifts to help elite universities attract low- to middle-incoming students.

Money is sloshing all over the place, yet despite some encouraging progress on the institutional funding front and support from donors like Oprah Winfrey, Hank Aaron, Sean “Diddy” Combs, and others, the Stryker/Johnston is an outlier due to its size. HBCUs rarely receive the type of large donation that is typical of Ivy League schools and some of the larger, more affluent predominantly white institutions (PWIs).

Prior to the Stryker gift, the largest commitment ever made to a HBCU was Bill Cosby’s $20 million gift to Spelman—in 1998.

Nor have HBCUs fared any better when it comes to relatively smaller donations. In 2017, there were 462 gifts of $1 million or more to higher education. HBCUs received just two of them, the largest a $1.6 million bequest to Tuskegee University.

This is all the more perplexing considering that while HBCUs constitute just 3 percent of the nation’s institutions of higher learning, they graduate nearly 20 percent of black students who earn undergraduate degrees. More than 50 percent of African American professionals and public school teachers hail from HBCUs. And while about 35 percent of all college students come from families that qualify for the federal Pell Grant, two-thirds of HBCU students are from Pell families.

For higher ed mega-donors concerned with social justice, impact and remedying inequality, supporting HBCUs should be low-hanging fruit. It isn’t.

Explaining the Disconnect

How do we explain this tepid level of private support for HBCUs? There are no shortage of theories. Let’s start with the most fertile source for massive donations, alumni.

A couple of years back, music industry legend Herb Alpert made a $10.1 commitment to Los Angeles City College. Like the Stryker/Johnson gift, Alpert’s was also a rare thing: According to an estimate provided by the Council for Aid to Education, only 1.5 percent of charitable gift dollars raised by educational institutions go to two-year institutions.

In large part, this data point reflects the fact that these schools simply don’t have a lot of rich alums—in contrast to Ivy League schools, which reap most of their mega-gifts from incredibly wealthy graduates. This demographic reality can also explain HBCUs’ lack of philanthropic support.

This reality is further compounded by the fact that although African Americans tend to give a larger share of their discretionary incomes to charity than do white Americans, they also tend to have less accumulated wealth, even at similar levels of educational attainment. According to the New York Times, for every $100 in white family wealth, black families hold just $5.04.

In addition, HBCUs historically have been at a disadvantage in receiving large philanthropic gifts from non-alumni. “There's racism involved in acquiring funds,” Marybeth Gasman, a professor at the University of Pennsylvania Graduate School of Education, told Bloomberg. In the past, “funders did not trust African Americans to manage their money, so they didn't give.”

With relatively small asset bases, HBCUs can’t gain access to the kinds of investment strategies available to schools with multibillion-dollar endowments. “Wealth begets wealth,” Gasman said. “This is the same thing that happens with HBCUs.”

HBCUs are also grappling with issues like dwindling enrollment, deteriorating infrastructure, student defaults, rising pension costs, increased competition from PWIs looking to diversify their student bodies, and cuts to public funding. With a few exceptions—see the Kresge Foundation’s recent $50 million lifeline to Detroit’s Marygrove College—few donors have the desire to rescue a struggling institution from insolvency.

Last but not least is the fact that donors may be reluctant to support HBCUs that have a six-year degree-completion rate of 32 percent, according a recent report from the Education Trust, compared with a 45 percent rate for black students at all kinds of institutions.

But these findings, according to Ray Franke, an assistant professor of higher education at the University of Massachusetts at Boston, don’t take into account systemic differences between students, like socioeconomic status or institutional disparities in revenues and wealth.

HBCUs’ lower completion rate doesn’t mean that the schools have an inferior educational model. Rather, low-income students, who attend HBCUs at a comparatively higher rate compared to other kinds of institutions, don’t have access to college-prep opportunities and the kind of financial safety nets available to their middle- and upper-income peers. As a result, they are more likely to drop out early.

“If we want to increase overall degree-completion numbers, then we ought to allocate resources to those institutions that educate students that have difficulty persisting and graduating,” Franke told the Chronicle of Higher Education.

Making the Case for HBCUs

Writing in Ebony, Julianne Malveaux quotes Bill Spriggs, an economics professor at Howard University, who argued that part of HBCUs’ struggles “has to do with inequality, which has not been fully dealt with in our nation. We don’t tell the stories of our success well enough. Students who graduate from Howard University earn more than those from the elite Williams College.”

Spriggs is on to something. A 2015 Gallup survey found that “black graduates of HBCUs are more likely than black graduates of other institutions to be thriving in several elements of well-being” and that “black HBCU graduates are more likely than black graduates of other institutions to strongly agree they had support and experiential opportunities while obtaining their undergraduate degree.”

Earlier this year, a study conducted by University of Massachusetts’ Franke found that the chances of graduating in six years for black students are significantly higher at the black colleges versus a PWI, when controlling for key variables.

Looking ahead, Ebony’s Malveaux suggests that there is significant room for improvement on the fundraising front. For instance, while PWIs like Princeton have an alumni giving rate of 60 percent, HBCU giving rates generally fall below 10 percent. Part of this is attributable to the wealth gap. But Morehouse College president emeritus Robert Franklin isn’t entirely convinced. “With all of the Black wealth out there and the huge gifts some colleges have received from African-Americans, one would think that our institutions, also, should receive these gifts,” he said.

And therein lies some degree of irony: Ronda Stryker and William Johnston, whose largesse may compel other African-Americans to support historically underfunded HBCUs, didn’t attend Spelman. They also happen to be white. Let’s see if other donors committed to social justice, regardless of their race, follow their lead.