When you think of gargantuan university endowments, you probably think of schools like Harvard and Stanford. Indeed, Bloomberg News estimated that Harvard’s endowment value—the largest in the country—reached $39.2 billion in 2018. But you might not have guessed who came in second: the University of Texas System, at $31 billion.
About two-thirds of that money comes from oil in state-owned territories. And the oil business in Texas has been booming. Where has that money gone? Last year, the Monthly reported that most UT endowment spending went toward elevating the school’s national status rather than helping students cover the costs of attending. In fact, despite the bloat of money, the UT System’s chancellor requested a tuition increase.
This past week, however, saw a Texas-sized step in the right direction: starting next year, UT-Austin will fully cover the tuition and fees of students whose families earn $65,000 or less in adjusted gross annual income.
This brings the University of Texas more in line with schools with similar endowments. Harvard also covers tuition and fees for students from households earning the same amount, and it nearly guarantees that those who earn between $65,000-$150,000 won’t pay more than 10 percent of the actual cost.
As the Monthly has pointed out, these generous forms of aid don’t mean much, since schools like Harvard tend to admit very few students from households that would qualify for that level of aid. That’s what makes UT-Austin’s move so great. School officials told the Texas Tribune that about “a quarter of its undergraduates from Texas—8,600 students—would have their tuition fully paid under the new plan, and an additional 5,700 would receive financial aid from it.”
How much did it cost to make this happen? $160 million, or 0.5 percent of the UT System’s endowment.