Not too shabby. Will the liberal school be sharing its wealth with less fortunate universities?

Joseph Asch of Dartblog reports.

Endowment Yields 19.2%; Rises to $4.5B

The endowment has risen from $3.73 billion to $4.50 billion as the College announced that its investments yielded a 19.2% return. That’s the best performance since the blowout at the top of the bubble in 2000, when the endowment rose by a mind-numbing 46%. (As a cautionary tale, it fell by 3%, 6% and 3% over the next three years, and the administration was forced to make painful budget cuts). The College’s calculation is as follows:

The increase reflected net investment gains of $778 million and new gifts and transfers of $146 million, offset by distributions of $189 million to support Dartmouth programs.

By way of background, the draw from the endowment to support the College’s operations each year is about 5% of the total value of the endowment (based on a rolling three-year average).

The real question here is, “Hey Phil, what you gonna do about it?” A jump in the endowment of $735 million will allow the endowment to throw off an extra $36.8 million in a couple of years (recall the 5% draw figure mentioned above). Where will the money go? If past practice is followed, the ever-growing, overpaid staff will get most of it. One might expect that this is how things will go this time around, too — after all, most faculty members received a raise of only 1.5% this summer, with some getting a meager performance raise on top of that figure.

I’d suggest that right now Phil announce that he is allocating a good chunk of this money to reducing tuition. The 2.9% increase for this year was twice the rate of increase in the Consumer Price Index, even though Phil had promised increases in line with inflation. He justified that commitment on the basis that investment returns would probably be moderate in the coming years. How happy he must be to have been wrong. In 2013, the College took in about $120 million in undergrad tuition (not including room/board and fees). Using part of the new $36.8 million could make a big dent in that figure.