Parting Ways: Why a University Wants to Return a Donor’s $21.5 Million Gift

Katherine Welles/shutterstock

Katherine Welles/shutterstock

The chancellor of the University of Alabama system is calling for the return of more than $21 million donated to its Tuscaloosa law school a few months ago.

At the heart of the matter is a rift between the university and donor Hugh Culverhouse Jr., whose multimillion-dollar largesse renamed the university’s law school in September. The divide between Culverhouse and the university reflects a growing trend in higher education: aggrieved and vocal wealthy donors who are unhappy with the way their six- and seven-figure gifts are used.  

In most cases, donors demand their money back—schools seldom look to return gifts. But there’s a common thread in many of these unhappy episodes: tension between universities and philanthropists over issues of control.

At the University of Alabama, Chancellor Finis E. St. John has not only asked the board to return the donation to the recently renamed Hugh F. Culverhouse Jr. School of Law. He also recommends that the law school revert to its previous name: University of Alabama School of Law.

In addition to the law school gift, Culverhouse and his wife have made other gifts to the university. In March, for example, a $500,000 donation to the College of Arts and Science established the Eliza P. Culverhouse Fund for Excellence in Dance.

Culverhouse has tangled with the university on more than a single front: First, the donor argued that the law school should significantly increase the size of its student body, a request he said was denied simply to optimize the law school’s rankings by U.S. News & World Report.

“I want the university to be one of the best universities, but we’re going to do it the right goddamn way,” Culverhouse said in a profane-laced interview with the National Law Journal. The current number of students, he added, “isn’t going to do it.”

After university officials resisted his demands, which some have said amount to meddling in university administration, Culverhouse asked the school of law to return $10 million of his gift.

Next, Culverhouse made waves by calling on students to boycott the University of Alabama after Republican governor Kay Ivey signed a law last month banning most abortions in the state. “I cannot stand by silently and allow my name to be associated with a state educational system that teaches students law that clearly conflicts with the United States Constitution and federal law, and which promotes blatant discrimination,” he said in a statement.

In response, the university issued a statement, clarifying that its issues with Culverhouse have nothing to do with the new law. Rather, it said the key issue here was the university’s independence: “Donors may not dictate university administration,” UA said in its statement.

As we’ve reported, universities have come under growing scrutiny for the leeway they grant to donors when it comes to decisions over faculty hiring, curriculum and other issues.

When it meets later this week, the UA board is expected to act on St. John’s recommendation to return the gift.

Related: Name and Shame: A New Initiative Tracks Undue Donor Influence at Universities