Because we realize that it will take some time for the new tax changes we demand to take effect, we expect withdrawals to be made from the UNC endowments, in 2020, 2021, or as long as our current funding crisis lasts.

The University of North Carolina is a wealthy university system. The consolidated endowments of the UNC System (a.k.a. UNCIF) amounted to more than $6.5 billion in 2019. [28] Even with the general economic downturn that has affected the rest of us, its balance is at least as much  at present, and probably even more, with additional gains due to the relative stability of the stock market and the subsidies to Wall Street from the Federal Reserve Bank’s quantitative easing strategies. [29] The quantitative easing stimulus is an ongoing US taxpayers' gift to the 1% and corporations, guaranteeing them almost  free capital needed to write off financial speculative losses and pump up their stock returns. Currently, as of today (October 25, 2020)  the stock market returns for the year to date are only down less than 1% (i.e., 0.71%) from the beginning of the year, according to the Dow Jones Industrial Averages, during an economically disastrous year for the rest of us. [30]

Since early in the COVID-19 crisis, there have been calls for wealthy universities across the country to use their endowment resources to protect students and workers. [31] These calls have often been categorized as non-viable given the legal restrictions which limit endowment spending. Despite the reality of those limitations, the experiences of various universities show that endowment funds can in fact be used to finance budget shortfalls. [32] This is true even for universities with endowments lower than those of the UNC System, such as The University of Delaware, which managed to draw $100 million from its $1.6 billion endowment. [33] While we reject the University of Delaware’s staff cuts measures, we acknowledge its willingness to use endowment funds to deal with the crisis, and demand universities of the UNC System to do the same. 

The UNC System endowment is the property of the people of North Carolina, not of its investment managers, the BOG, or UNC administrators. [34] It exists to meet the needs of the University, its students, and the people it employs who carry out its mission of teaching, research and service to the people of North Carolina. It has a special status because it is tax exempt, never having paid one cent of taxes on its billions of dollars in gains. It has only received this tax-exempt status because it is being “held in trust” to be used for the higher education of the people of North Carolina. Though we acknowledge there are limitations to the use of endowment funds, we also emphasize the various flaws and inequities of their administration such as the refusal to divest their fossil fuel holdings even when our planet is undergoing massive ecological destruction and the very real effects of climate change directly affect the people of North Carolina through hurricanes and floods. Not only has divesting fossil fuels and reinvesting in green energy become a major ethical imperative in the current moment, but it is also economically responsible as green energy yields greater returns. [35]


A major funding source to facilitate the transition to a post-pandemic North Carolina are the fossil fuel holdings of the UNC System consolidated endowment, which amount approximately to 6.8% of its total portfolio, according to the 2019 UNC System endowments annual report. [36] These are listed as “Energy and Natural Resources,” and consist of a majority of holdings in fossil fuels, with the remainder in  fossil-fuel intensive commodities like industrial metals and cattle. 

To carry out the transition we demand that the UNC BOG and the endowments’ managers:

  • Make divestments and withdraw from the UNC System endowments of more than $100 millions, the $407 million they currently hold in fossil fuel holdings and use this withdrawal to provide bridge-financing proportionately to each campus.

It is appropriate that this modest amount of the $6.5 billion consolidated UNC System endowment be used to subsidize the UNC System as it experiences an unprecedented crisis. We demand that for 2021 at least $407 million (Table 1) for social holdings be immediately divested and withdrawn from the endowments for the eight UNC schools whose endowments are greater than $100 million. This money can be used as bridge financing between the current period of financial shortfalls and a post-pandemic state.

  • Divest from fossil fuels and reinvest in green energy for the UNC campus endowments holding less than $100 million.

For the nine campuses holding endowments of less than $100 million, we demand that their fossil fuel holdings be sold off and the profits reinvested in green energy holdings. Assuming these holdings represent an 6.8% of their portfolios, these would amount to little more than $30 million.

 Table 1. UNC System Endowments: Size and Fossil Fuel Holdings. Data from 2019 UNCIF Annual Report and 2019 UNC System Consolidated Financial Report. [37]

  • Withdraw additional funds from the endowments of the two campus endowments that are by far the largest: UNC Chapel Hill and North Carolina State University, in order to provide bridge funding to the post-pandemic era.

The endowments of two campuses, UNC Chapel Hill, and North Carolina State University, are by far the largest of the System, with $3.5 billion and $1.1 billion respectively in their holdings. It is perfectly appropriate that these enormous accumulated endowments, favored as they have been for generations by tax-exempt status, be used to provide bridge funding between the current situation and the new appropriations that we demand for 2021. 

For example, the Chancellor of UNC Chapel Hill has told us that we can expect $300 million in losses for the campus in this current fiscal year. [38] This $300 million would amount to a mere 8.3% of the UNC Chapel Hill’s campus endowment of $3.5 billion, and it would include all $238 million that the campus Endowment now holds in fossil fuels and natural resources holdings. In addition, the Chancellor would be the first to point out that approximately $207 million from the UNC Chapel Hill endowment is already earmarked for various worthy campus expenditures – faculty salaries included. So we will include another $207 million withdrawals, making a total of $507 million in total withdrawals in 2021.


“We can’t afford it!” endowment managers and BOG members will claim. Really? How long would it take the UNC Chapel Hill endowment to recover this amount fully if it were used to bridge UNC Chapel Hill’s 2020-21 budget? At the UNC-CH endowment’s historic 7.0% rate of return over the last eight years, projected into the future, we have found that it would take only two  to three years (i.e., some time in 2023) to recover completely the $507 million in funds  that needs to be withdrawn for emergency purposes now (Figure 4). We demand that the University of North Carolina Chapel Hill Endowment withdraw $507 million to serve as bridge funding from now to the post-pandemic period. We also demand that the North Carolina State University endowment withdraw a comparable amount of funding to be used to bridge from the present to the post and pandemic era. Given that the 10-year historic rate of return for the UNC System consolidated endowment is in fact 9.0% (Figure 2), we see this as a perfectly reasonable measure. [39]

Figure 2. UNC System endowment. From: 2019 UNC System Consolidated Financial Report. [40]


Our objective in making these demands is not to provide these two campuses with even greater funding for their operations than they ever had before, but to temporarily  deploy some of their tax-free endowment wealth to make up for shortfalls during this period of crisis. It is moreover appropriate that the UNC Chapel Hill campus forego bridge funding from other sources such as the North Carolina Rainy Day fund and other sources of emergency funding available to the UNC System (see below) because of the disproportionate wealth of its endowment holdings.

  • Equitably allocate $150,120,000 from the State’s Rainy Day Fund to UNC System campuses to meet financial emergencies.

It’s raining hard. Why aren’t we using the Rainy Day Fund? The state of North Carolina government has a $1.2 billion “Rainy Day fund.” According to state law, up to 7.5% of the current $6 billion plus North Carolina General Fund can be withdrawn from the RDF for use on a “Rainy Day.” [42] This would amount to $450 million. We realize that the needs of the people of North Carolina are many, yet it is fair that about one third of this Rainy Day fund be allocated to the UNC System, since the state government expands about one third of its funding for public higher education through the UNC System. Proportionally this would amount to $150 million.

We demand that the 7.5% of the General Fund that is legally available for withdrawal be done so immediately, and that one third of that, amounting to approximately $150,120,000, be allocated to the UNC System campuses to meet their emergency financial needs during the pandemic. All campuses of the UNC System other than UNC Chapel Hill and NCSU should have access to this emergency funding. Consistent with principles of solidarity, this amount should be allocated unevenly so that the least well-endowed campuses of the UNC System (its Promise Schools and HBCUs) are given first priority to RDF funding. We have to protect the financial base of the least well-endowed campuses first.

We call for the remaining $300 million to be withdrawn from the Rainy Day fund and used to meet the immediate emergency needs of K-12 public education in North Carolina.

  • Still determined to cut? All cuts should start and end at the top.

On the UNC Chapel Hill campus and on other campuses of the UNC System, huge six-figure administrative salaries and the proliferation of administrators with titles such as “Associate Provost,” “Associate Vice Chancellor,” “Assistant Dean of …,” “Associate Senior Dean of…”, etc. have recently been noted. [43] According to the salary database, there are approximately 1,650 employees in the UNC System with salaries of $200,000 or more. [44] This administrative bloat has occurred as UNC campuses increasingly conform to a for-profit business model.  Under such a model campuses are expected to provide their undergraduate students with various administrative “services,” a dynamic which sees students mainly as “customers” not as learners of knowledge and skills needed to participate in our democratic and hi-tech society. Many of these offices and their administrators have functions of marginal value relative to the core functions of teaching and research at our universities, but use up a disproportionately high percentage of our campuses’ payrolls.

If, despite our demands to the contrary, the UNC BOG and UNC campus chancellors and Provost continue to insist upon inflicting budget cuts upon us, we demand that they start and end at the top. The expenditure of large salaries and the outfitting of prestigious offices leads to the proliferation of high-level administrators, many of whose tasks are unclear, and they are never called upon to justify what they do to the rest of us.  On the UNC Chapel Hill campus for example, there are 12 vice-provosts, 28 vice-chancellors, 127 deans, and 811 directors or associate directors of various programs and institutes. Many of these officials have vague or indecipherable job descriptions, but this does not prevent the university from assigning them enormous salaries. [45] Many of these positions could be eliminated and no one would notice. For those who remain, temporary salary cuts of 50% should be imposed before a single graduate student, faculty member, or other campus worker is asked to accept a furlough or face a lay off. 

At a time of imposed austerity, we believe that the huge salaries and bonuses of the staff of the UNC Management Company which manages the UNC System consolidated endowments should be targeted for substantial (50% plus) cuts. Their nine top-paid managers out of a total staff of 25 had salaries and commissions in the depressed year 2020 that ranged between $352,000 and $1,300,000. [46] These compensation levels are astounding, especially in a year of massive unemployment and income losses due to the pandemic. While it is questionable whether they ever deserved such high compensation, their current levels are inexcusable at a time when the UNC BOG insists on inflicting huge cuts on the rest of us. We demand that the 25 employees of the UNC Management Company team take 50% cuts as part of the sacrifice being inflicted on the rest of us. Such savings should be redirected toward needy student scholarships.

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