In 2023, following the passage of the Donor Intent Protection Act in Kansas, Philanthropy Roundtable launched a monthly series on donor intent developments and controversies nationwide to better inform you about this important topic. The Donor Intent Protection Act has now passed in Kentucky and Georgia as well, and efforts on behalf of this legislation continue in additional states.
This month’s Donor Intent Watch includes reporting on the court decision to allow Middlebury College to remove the donor’s name from its iconic chapel, a donor intent disagreement between the MacArthur Foundation and the San Francisco district attorney’s office and one of the first examples of the financial ramifications of the donor revolt in the wake of the October 2023 Hamas attack on Israel and the subsequent campus disruption.
We encourage donors to contact us with any questions about our featured items and consult additional resources on donor intent at the Roundtable’s Donor Intent Hub. We also welcome any news about donor intent we may have missed.
A Chapel by Any Other Name
We first reported on the donor intent dispute at Vermont’s Middlebury College in May 2023, summarizing the situation as follows:
In 1914, in honor of the 50th anniversary of his graduation, former Vermont Gov. John Abner Mead offered a sizeable gift to his alma mater to build a chapel on the Middlebury campus. By the time the chapel was completed in 1916, Mead’s gift totaled $75,000 (over $2 million in today’s dollars). In the fall of 2021, Middlebury College officials announced they had removed Mead’s name from the campus chapel because of his support for eugenics policies in the early 1900s. Another former governor and Middlebury alumnus, Jim Douglas, is now representing the Mead Family and has filed a breach of contract suit against the college.
Middlebury has claimed the Mead Memorial Chapel—which over time has become the iconic representation of the college—was named in honor of John Mead and his wife. Douglas included a copy of Mead’s original gift letter in the complaint he filed with the Vermont Superior Court on March 24, and that document indicates Mead’s naming intention was, in fact, to honor his ancestors. It is not clear how much the suit will revolve around the gift letter and what role John Mead’s early involvement in Vermont’s eugenics movement will play.
On October 3, 2024, Vermont Superior Court Judge Robert Mello ruled that the chapel, now simply “Middlebury Chapel,” can keep its altered name. The court ruling does not, however, close the door to a possible jury trial on narrower grounds. As reported by vtdigger.com, former Gov. Douglas commented, “I said all along that I want a jury to hear this case. I think a group of 12 disinterested people will be fair.” Any new legal activity would first consider whether the 1914 agreement between the college and Mead is a gift or a contract. If it is indeed a contract, then a second question would be whether Middlebury College violated its terms by renaming Mead Memorial Chapel.
Read more here.
An Ironic Turn of Events at the MacArthur Foundation
John D. MacArthur was a firm champion of free enterprise and limited government. He was also a careless philanthropist, leaving a great fortune to a foundation without any instructions for its use. In a short time after his death, his son Rod MacArthur gained control and – ignoring his parents’ values and interests – transformed the foundation into a major supporter of left-of-center causes.
In 2018, the MacArthur Foundation made a multi-year $5.2 million grant to the San Francisco district attorney’s office to support then-District Attorney George Gascon’s plan to reduce the city’s jail population. That work continued under District Attorney Chesa Boudin until he lost his position in a recall election. With the city facing rising crime, District Attorney Brooke Jenkins, a mayoral appointment, has made public order his top priority and the jail population has grown.
Noting that growth, the MacArthur Foundation informed Jenkins that unless he changed course and resumed the reduced incarceration program of his predecessors, his office would lose the remaining grant funds totaling $625,000. The response from Jenkins’ chief of staff was no doubt an unwelcome surprise to the foundation, as it made clear that no change in priorities would be made and there was no need for the $625,000 final payment.
“Our office has a mission to protect the safety of all those who live, work and visit San Francisco,” the reply stated, “and while we believe in the mission of identifying alternatives to incarceration, we must achieve it in a manner that does not come at the expense of the safety of our city.”
William Schambra has written an outstanding article on this dispute, noting the “arrogance from a major national foundation mandating continued pursuit of reforms to citizens desperately trying to roll back a crime wave that they attribute precisely to those reforms.” We agree. We also wish to note the irony of a situation in which a foundation which has for decades consistently ignored the values of its founders suddenly rears up to demand that donor intent be honored.
Counting the Losses of the Donor Revolt
While we anticipate the February 2025 release of the CASE Insights on Voluntary Support of Education survey report for fiscal year 2024, we’ve received some early signals from Harvard University about the financial ramifications of the donor revolt in the wake of the October 2023 Hamas attack on Israel and the subsequent campus disruption.
In a recent interview with The Crimson, Harvard’s President Alan M. Garber ’76 anticipated a decline in the institution’s fundraising numbers over the previous fiscal year. This comes as no surprise, as Garber had discussed the likelihood of this outcome in March. The release of Harvard’s 2024 financial report has now confirmed his expectations.
While current use gifts from alumni, foundations and others increased from $486 million in fiscal year 2023 to $528 million in fiscal year 2024, the author of the article in The Crimson noted “the number of individual contributors has decreased, according to a person directly familiar with the 2024 data.” Even more concerning, cash gifts to the university’s endowment fell from $561 million in fiscal year 2023 to $368 million in fiscal year 2024. It’s noteworthy that the 2024 report did not focus on that one-year drop of 34% but instead reminded readers, “Over the past 10 years, gifts have ranged from a high of $646 million to a low of $338 million.”
As higher education donors begin to look beyond their alma maters to other colleges and universities more aligned with their values, and as they turn away from unrestricted and endowment gifts to protect donor intent, we will be tracking the financial impact of their decisions on where and how to give.
In Cambridge, Garber remains cautiously optimistic that donors will appreciate the relative quiet of the current academic year on campus and that the university’s future fundraising efforts will be more successful. It is Harvard, after all.
