Faculty SenateSeptember 17, 2013

AUBURN UNIVERSITY FOUNDATION AND COMPREHENSIVE CAMPAIGN BRIEFING

Auburn University Foundation: A non-governmental, non-profit organization separate and distinct from Auburn University[separate 501(c)(3)]Purpose: Receive charitable contributions for the

benefit of AU and AUM Assure donations are kept separate from

state funds

Auburn University Foundation

Manage AU, AUF, AAA, TUF endowments.

AUF investment objective: To earn a total return (net of portfolio management fees) within prudent levels of risk, which is sufficient to maintain in real terms the purchasing power of the endowment’s assets and support the defined spending policy.

Auburn University Foundation

Auburn University Foundation Board Consists of 24 voting directors who serve

four-year terms 3 Ex officio, non-voting members:

AU President AUM Chancellor Auburn Alumni Association President

Auburn University Foundation

AU/AUF Endowment | Update thru 7/31/13 Combined Market Value (12/31/2012):

$488,247,605

2012-13 Distribution to the University: $17,229,000

2012 Endowment Performance: 9.9%

Endowment Annualized Returns: One-year 13.6% Three-year 8.8% Five-year 4.3%

Combined Market Value (07/31/2013): $524,962,719

2013 Endowment Performance (through 7/31): 7.7%

2013 Endowment Distribution / Designation

$515.57M

$9.38M

AcademicsAthletics

50%

35%

15%Funds for Excellence

Scholarships/Fellowships

Chairs/Professorships

Endowment Distribution

Endowment Designation

Spending FormulaA weighted calculation of two components:

First component (80%) is the prior year payout amount adjusted for inflation (CPI)

Second component (20%) is the spending policy target rate (currently 4%) applied to the 12-month avg. of market values

[80%)(Prior year’s payout)(1+CPI)]+[(20%)(12-month average of market value)(4.0%)]

Endowment Spending Calculation Example:

Payout Calculation:[(.80)($40,000)(1+.034)]+[(.20)($1,080,000)(.04)] = $41,728

Endowment Spending Formula

Endowment Asset AllocationPercent

Allocation

Domestic Public Equity 15.0Non-U.S. Developed Equity 14.0Emerging Markets Equity 7.5Global Private Equity 12.5Long/Short and Absolute Return 25.0Natural Resources (Public and Private) 4.0Commodities 4.0Real Estate (Public and Private) 5.0U.S. TIPS 2.0Core Bond 6.0High Yield -U.S. Treasuries -Non-U.S. Government Bonds 5.0Cash (T-bills) -

100.0Total:

Inflation Hedging

Deflation Hedge

Liquidity

Credit

Flexible Capital

Asset Class

Equity

Dollar Hedge

2012 Development Results | calendar year 2012 Total Gifts and Commitments

$111,001,242 $76,424,036 Outright Gifts and Pledges $9,494,065 Deferred Irrevocable Gifts $25,083,141 Deferred Revocable Gifts

Four Year Results

41% cumulative

increase

2009 2010 2011 2012 2013

$78,735,75

2

$85,722,62

0

$93,942,64

7

$110,480,6

08

$122,875,0

00

+10%

+18%

+9%

2013 Goal

Campaign Timeline

PreparationPhase

Through Dec. 31, 2012Goal: $300 million

Actual: $400.6 million

Leadership GiftPhase

Jan. 1, 2013 (24-30 months)

Goal: $400 millionCumulative: $700 million

CAMPAIGN KICKOFF

PublicPhase

30-36 months (Dec. 31, 2017)

Goal: $300 millionCumulative: $1 billion

CAMPAIGN CELEBRATIONCAMPAIGN

AUTHORIZATION

Post-Campaign Assessmen

t

Campaign seeks to secure at least $1 billion in new gifts and commitments, both spendable/annual and endowed, for Student Support, Faculty Support, Programmatic Support, and Facility Support.

Endowment Giving - for a campaign of $1 billion, it is expected that approximately 25-35% of the total will be endowment commitments.

Deferred Gifts - for a campaign of $1 billion, it is expected that approximately 30% of the total will be deferred gifts. Deferred gift instruments, such as gift annuities, charitable remainder trusts, and simple bequests often are designated for endowment.

Financial Campaign Objectives

Volunteer Engagement – new volunteers will be engaged to serve Auburn during the campaign.

Donor Relations and Stewardship - the nature/level of donor appreciation and stewardship should be enhanced during and after the campaign.

Annual Giving - the annual giving program should be positioned to generate increased alumni participation and secure gifts in excess of $5 million annually.

Sustainable Giving – the level of annual philanthropic support will be elevated during the campaign. Post campaign aspiration is to maintain new gifts and commitments of approximately $100 million annually, economic factors permitting.

Additional Campaign Objectives

Campaign Progress | THROUGH 08.31.13

Area of Support Working Goal Progress % to Goal

Students$237,362,50

0$129,384,4

11 54.51%

Faculty$139,435,00

0$29,857,35

9 21.41%

Programs$377,453,55

3$301,203,1

41 79.80%

Facilities$338,720,55

9$39,468,52

8 11.65%

Totals$1,092,971,

612$499,913,4

39 45.74%

Campaign Progress | THROUGH 08.31.13

Area of Support Outright Gifts Deferred Deferred Campaignand Pledges Irrevocable Revocable Total

Student Support Annual 61,620,310 341,626 4,585,502 66,547,438 Endowed 32,988,278 6,791,230 23,057,465 62,836,974 Subtotal $94,608,588 $7,132,856 $27,642,967 $129,384,411Faculty Support Annual 2,367,165 22,157 0 2,389,321 Endowed 24,631,101 712,506 2,124,431 27,468,038 Subtotal $26,998,265 $734,663 $2,124,431 $29,857,359Program Support Annual 172,551,190 12,455,564 42,867,711 227,874,465 Endowed 54,619,086 4,246,189 14,463,401 73,328,676 Subtotal $227,170,275 $16,701,753 $57,331,112 $301,203,141Facility Support Annual 32,541,677 4,414,992 2,165,534 39,122,203 Endowed 1,325 0 345,000 346,325 Subtotal $32,543,002 $4,414,992 $2,510,534 $39,468,528Totals Annual $269,080,341 $17,234,339 $49,618,747 $335,933,427 Endowed $112,239,789 $11,749,925 $39,990,298 $163,980,012 Totals $381,320,130 $28,984,265 $89,609,044 $499,913,439

Campaign Progress | THROUGH 08.31.13

COLLEGES AND SCHOOLS Campaign GoalProgress toward Campaign Goal

(through 08.31.13)

% of Progress toward

Goal

Agriculture (includes AAES) $42,000,000 $27,116,516 64.56%

Architecture, Design & Construction $30,700,000 $10,346,388 33.70%

Business $100,000,000 $66,362,264 66.36%

Education $34,900,000 $8,512,261 24.39%

Engineering $206,600,000 $87,712,928 42.46%

Forestry & Wildlife Sciences $19,804,112 $13,419,268 67.76%

Graduate School $1,500,000 $243,666 16.24%

Honors College $4,000,000 $1,093,022 27.33%

Human Sciences $36,000,000 $16,414,214 45.60%

Liberal Arts $22,950,000 $14,369,569 62.61%

Nursing $18,800,000 $6,801,559 36.18%

Pharmacy $21,050,000 $5,076,477 24.12%

Sciences & Mathematics $34,000,000 $12,743,617 37.48%

Veterinary Medicine $63,110,000 $38,839,882 61.54%

Campaign Progress | THROUGH 08.31.13

CAMPUS-WIDE UNITSCampaign

Goal

Progress toward Campaign Goal

(through 08.31.13)

% of Progress toward

Goal

Alabama Cooperative Extension Sys. $10,000,000 $7,191,578 71.92%

Alumni Affairs $7,150,000 $4,248,204 59.42%

Athletics $223,000,000 $123,528,044 55.39%

Auburn University Montgomery $12,500,000 $11,511,281 92.09%

Central Classroom Bldg. (proposed) $49,500,000 $0 0.00%

Diversity & Multicultural Affairs $4,900,000 $760,109 15.51%

Enrollment Services $41,000,000 $20,131,575 49.10%

Libraries $5,000,000 $1,558,310 31.17%

Museum $7,500,000 $3,418,026 45.57%

Outreach $10,657,500 $142,684 1.34%

Performing Arts Center (proposed) $60,000,000 $0 0.00%

Research $17,100,000 $4,353,340 25.46%

Student Affairs $7,250,000 $668,882 9.23%

Sustainability $2,000,000 $15,909 0.80%

Questions?