In an uncertain economy, colleges are finding donors much more cautious and tight when asked to contribute.
Bruce Flessner's cell phone has been ringing nearly nonstop. When he answers, it's almost always a college president or someone leading a fundraising campaign.
"They're nervous," said Flessner, whose company consults with colleges and universities on fundraising. "I don't think I've ever had this many calls from presidents and campaign chairs."
In a financial crisis where the net worth of prospective donors is dropping on a daily basis, how will colleges and universities fare?
In addition to annual fundraising, several Minnesota schools are in the midst of capital fundraising drives. Some are fairly modest, such as a $10 million goal at Winona State and a $17 million campaign at Southwest Minnesota State. But other efforts are massive. St. Thomas still has about $150 million to go in a $500 million campaign, and Carleton has roughly $90 million remaining to reach its $300 million goal.
"Part of the spirit of a campaign is the optimism ... to set an ambitious goal, and because people believe in Carleton we're going to reach it. That kind of optimism and can-do is harder right now," Carleton College President Robert Oden said. "You're doing that with one hand, but, with the other hand, you realize things are shaky right now. Our endowment is down a fair amount. We don't have any problem right now meeting the payroll, but, if things continue, it could get a lot tougher."
College officials have many of the same questions as people wondering what is going to happen to their 401(k) given the economic situation.
"We don't know if we've reached the bottom of this, and we don't know how long it will take to turn things around," said Jim Schmidt, vice president for university advancement at Winona State.
While Minnesota schools say they haven't had donors back off pledges they previously made -- in most cases donors usually have five years to make payments -- they have begun to see some uneasiness.
"Uncertainty creeps into the mix; they aren't sure how much they can part with and send your way even though they believe in you," said Mark Dienhart, St. Thomas executive vice president. "The best thing you can do in times like this is realize that the reason why you have campaigns of the lengths we do is so we can survive these different cycles."
A Winona State donor who has given to the school on a regular basis recently told officials there that he wouldn't be able to give as much as he would like. The reason: He held a significant amount of Wachovia stock and his cash flow is not where it has been.
"I could tell it broke his heart," Schmidt said.
Flessner expects that nationally there will be schools that are in the early stages of a capital campaign that will delay launching it. But the ones already in progress have little choice but to go forward.
"It's going to be a tough quarter," he said. "They're going to have a difficult time, but it's not going to be an impossible time."
If there is a trend that already has emerged, it is that donors are delaying decisions on whether to contribute.
"On one of my trips of late a couple of people said, 'We're going to make a commitment, but we're going to wait a couple of months right now,'" Carleton's Oden said. "We have $90 million left to raise, and a year and nine months to do that. Instead of that $90 million being spread out evenly, we might go several months with much lower commitments and, toward the end of the campaign, get higher commitment totals."
Dienhart said that if the economic downturn continues, schools may readjust their fundraising goals by lengthening their campaign or lowering their goal.
"That's a hard thing to swallow; there's a face-saving thing in all of that," Dienhart said. "You don't want to ever admit there wasn't enough enthusiasm to have you meet your goal, but, in this case, it may not be a lack of enthusiasm. It might be that some people are overwhelmed by the burden of the economic times."
It's unclear precisely how tightening credit markets will affect colleges and universities.
Traditionally, schools have sold bonds to finance building construction on campuses. As pledges are paid, that money is then used to pay the debt service on the bonds. What's unclear now is whether money will be available for schools to borrow.
Flessner said the biggest thing schools are going to have to do is to be patient when it comes to seeing results while continuing to work hard at the process of capital campaigns.
"Higher education is very dependent on very large gifts, and it's a little harder for someone to give the biggest gift they've ever given when their net worth is down significantly," Flessner said. "You're going to have to be that much more patient in how long it's going to take to land this fish."