UI pledges $25 million to cover fundraising shortfall at med school

UI pledges $25 million to cover fundraising shortfall at med school

URBANA — A slower-than-projected fundraising pace for the new Carle Illinois College of Medicine has prompted the University of Illinois to pledge up to $25 million of UI discretionary funds over the next decade to support medical-school operations.

The medical school is also hiring a chief advancement officer to "amplify" fundraising there, and the UI is recruiting a new associate vice chancellor to coordinate fundraising for all health sciences, including the Beckman Institute, a new Cancer Center and the Department of Biology, according to Provost Andreas Cangellaris.

The UI and Carle recently updated the budget agreement for the medical school's first 10 years, with the UI pledging to cover any shortfall resulting from the fundraising challenges.

The engineering-based medical school, which opened last week, was designed to be privately funded. The Carle Health System is carrying the financial load initially, pledging $100 million over 10 years as well as $1.5 million annually for operating costs.

But the university is about $25 million behind its target in an eight-year, $135 million fundraising plan to support the medical school.

So far, the UI has raised $20 million, but administrators had hoped to have $44.8 million in gifts and pledges by this time, according to the agreement signed with Carle in August 2015.

As a result, the school's endowment isn't generating as much income as planned, leading to a potential budget shortfall, said Cangellaris, who briefed UI trustees at a board committee meeting Monday afternoon.

The new agreement ensures the 10-year budget plan remains on track and "the college has the funds it needs," Cangellaris said.

"It's just a commitment to bridge the gap until we get to the point where we can raise the money that's going to generate the revenue to cover the operating costs," Chancellor Robert Jones said after the meeting.

Cangellaris told The News-Gazette that the annual subsidy from the campus will fluctuate as the endowment grows and generates more income but will average about $2.5 million annually over the next decade.

The money comes from discretionary funds available to the chancellor for campus priorities, from endowment income, private gifts and research grants among other sources, officials said. It does not include state funding or tuition income.

"This is not state-appropriated dollars," Cangellaris said.

The funds have been used in the past as incentives for faculty hiring programs or academic priorities, Jones said.

"This is a pretty high priority, so it's pretty much consistent with what we've done historically," he said.

The campus is also contributing to the renovation of the Medical Sciences Building for the new medical school, which Cangellaris said is a common practice with major construction projects.

Administrators said they remain committed to the $135 million fundraising goal but couldn't achieve it in the current time frame.

Cangellaris said it's possible to hit the target in 10 years or even sooner, "but we need to accelerate the amount of time and effort we put into it, which is why we are doing these additional hires."

Details about salaries for the two new positions weren't immediately available.

Trustee Stuart King, who had raised concerns about the fund-raising shortfall this spring, thanked administrators and said later he was satisfied with the report, though he plans to follow up to get more details.

"Fundraising is always a challenge," he said.