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Dartmouth: A Way Forward

I previously wrote some thoughts on the Trustees Decision of 2007, which for those who haven’t read them, it basically boils down to “it sucks, but it won’t last.” But I didn’t specify any mechanisms by which change would be effected.

Since I wrote last I’ve done some more reading on the roles of the Trustees, the Charter, the Alumni Constitution, and who has power and authority over what. I doubt any lawsuits are going to change the current situation – I think the AoA has been mortally wounded. “I’m not Dead Yet!” is only worth something until the undertaker’s club meets its target, but go ahead and prove me wrong on these points, I want to be wrong.

The debate is certainly rancorous and many of the discussion boards have descended into acrimonious anonymous postings, debasing the reputation of all Alumni. I suspect this is a bit of ridicule on the part of those defeated in recent elections and a feeling of helplessness, betrayal even, by those on the other side. Emotions run high and it serves none well.

So, this is here to declare the situation not helpless. Now I do believe it is futile for anonymous posters to whine, “fine, I’m not sending my yearly contribution” online, but the power of the Alumni is in those contributions, both large and small. When the question is asked, “what right do Alumni think they have to have a say in how the College is run?” the answer is, “the College couldn’t run without their support.” I can’t exactly say to what degree that’s true – if somebody can tease apart the annual report and find that number, please post a comment.

We can also figure out what percentage of the alumni voted for the ‘insurgent’ candidates but I’m not sure anybody on the outside can tell what percentage of giving that group represents. This would be very handy to know.

So, what choice do they have? Stop giving to the College they love and thus weaken it? Give anyway, and just accept that the Alumni shall have no real control over the College’s destiny? No, as I wrote earlier, the Alumni derive power not just through their contributions (which isn’t remarkably different today than in the past), but through their ability to organize (that’s what’s new and deeply troubling to the status quo). So, this needs to be applied to the cynical version of the Golden Rule.

Alumni Investment Corporation. As of this writing the term has no hits on Google. Maybe it exists by another name – somebody educate me, I am not expert in the ways of educational fundraising, though I’ve never heard of this idea before. But here’s the basic idea: form an investment vehicle for like-minded Alumni to donate funds into in lieu of making donations directly to the College. The corporation would have to have a clear set of principles, by-laws, etc. so contributors know where their money is going. Being an investment vehicle, the investors would be issued shares and thus be able to pull their money out should the governance of the fund go astray. Changes to the fund’s policies would be done though a shareholder vote (stop me if you’ve heard this before) and there’d be nothing to stop competing funds, should they become necessary (though a proliferation of funds would incur weakness to each). The fund would need to be well-managed, so that it grows safely over time, and it would probably have to do the same kinds of fundraising (or smarter) that the College does. It would disperse funds to the College on its own terms, with strings attached. If the College were uncooperative, the fund would instead grow, until such time as the College were willing to accept the money.

There isn’t much here that’s new – there are mutual funds that organize to effect social change – the twist here is a select set of potential contributors and a very specific set of potential beneficiaries. The fund would have to be properly organized to garner a charity status so it would be as attractive a donation target under our Federal Income Tax regime. Obviously, profits from shareholder withdrawals would be taxable.

This arrangement leverages the two powers the Alumni really have and largely ignores the one that has been or can be abrogated from it. It allows the disaffected Alumni to continue to donate to the College, but in a manner they find morally acceptable and fiscally prudent.

Now, I have no idea how to organize this nor the time or expertise to manage it (I’m busy trying to get a startup funded), so somebody take the ball and run with it. I might even donate.

2 thoughts on “Dartmouth: A Way Forward”

  1. Bill,

    Funny, I’d had a very similar idea, though I’d pictured it as a trust (we’ve been working on setting up our wills), with two specific scenarios under which the money would be released to the College: parity is restored, or two-thirds of voting alumni agree that the fund has outlived its usefulness.

    When I’d raised the idea, though, someone else questioned how effective it’d be. Remember, the charter trustees have donated roughly $10 *million* each; even assuming 50,000 alumni (almost 75%!) are willing to contribute, they’d need to contribute an average of $200 each to get to the point of equaling just one charter trustee. Maybe because I’m looking at it from the perspective of a young alum who hasn’t made his first million yet (ha!), but those numbers seem daunting…especially if the College decides to actively campaign against the fund.

    What do you think?

  2. Bill McGonigle

    Hi, David, good to hear from you. I’ll take these point-by-point:

    First, your idea supposes we could get back the Trustee balance. I think the current generation won’t see it, because TPTB have seen what was coming and didn’t like it one bit. Convince me otherwise, but they have all the power here, and are going to exercise it how they want. Sorry to be glum, I’m not seeing a winning tactic here, so I think a shift of strategy is required.

    I believe my model gets results more directly than yours, assuming it can work. In your model, we try to get the Alumni Trustees back, give the money, and then try to say how it’s spent. In my model the money is tied directly to results and metrics, so it doesn’t matter what the Trustees look like, so long as they get done what the Corporation wants. Granted, it’s a new, untested model, but I think it better represents modern ideas of how to influence events with money.

    As to the size of the fund – your math works out, yet Dartmouth receives much more than $10M per year in Alumni donations, so there must be some really big ones spread in among the $200 ones. It would be great if they donated to the Alumni Investment Corporation instead. If those successful Alumni are among the majority who voted in the past few years, we’d be doing well, but we don’t actually know that.

    The College campaigning against the fund is an interesting problem. I imagined a spirited debate, and competition, but your remark imagines perhaps something less becoming a Dartmouth alum. I think the success of the petition candidates to date has shown that enough of the Alumni can see through the veil and recognize the behavior they want to support. It further illustrates the need for complete transparency in an Alumni Investment Corporation.

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