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Ann Arbor, Michigan
Friday, October 16, 2009
'U' endowment falls 21 percent
Big drop on par with that
of other endowments
across the country
By KYLE SWANSON
Daily News Editor
The University's endowment fell 21 per-
cent last year, a significant drop but one
on par with endowments of other schools
around the country.
The endowment's value now stands at
approximately $1.6 billion, University offi-
cials reported yesterday.
Reporting at the University's Board of
Regents monthly meeting, Executive Vice
President and Chief Financial Officer Tim-
othy Slottow presented the regents with
the annual report on investments. The
endowment, which was valued at $7.6 bil-
lion in June 2008 fell to $6 billion in June
2009, Slottow said.
The report presented to the regents yes-
terday showed that only one area of the
University's investments saw a positive
return last year - a 4.6-percent increase in
All other categories - equities, absolute
return, venture capital, private equity, real
estate and energy - posted double-digit
percentage losses. Among the largestwas a
38.5-percent drop in real estate assets and
a 30.5-percent decline in energy invest-
In a committee meeting before the
regents meeting, Slottow and Chief Invest-
ment Officer Erik Lundberg reported the
news to the regents and discussed how
the University would be affected by the
Reading a statement during the regents
meetingyesterday, RegentKatherine White
(D-Ann Arbor) said although the drop is
significant, the University is in a much bet-
ter spot than many other schools.
Many other institutions have lost larger
vard University, which lost 27 percent of its
endowment, and Yale University, which
lost 30 percent over the lastyear.
However, some institutions lost less than
the University of Michigan, including the
University of Virginia, which saw a 21-per-
cent drop in its endowment.
"Even though the banking crisis in the
short term created a challenging year ...
over the past 10 years, the University's
endowment has earned an annualized
return of 9 percent," White said.
White said the overall increase is evi-
dence that the University's long-term
approach to investing is paying off.
"Although these numbers showa signifi-
cant decline in one year, the endowment
is invested for the long term," White said.
"The overall performance of the portfolio
is consistent with our diversified strategy
to provide an ample amount of return to
support operations at the University, while
protecting the corpus and fostering the
At the end of her statement, White rec-
ognized Lundberg and thanked him for his
oversight of the University's investments.
In a letter presented to the regents, Slot-
tow and Lundberg wrote that the unex-
pected spikes and drops in the market are
"While a negative 23-percent return for
the endowment was always possible, it was
about as unlikely to occur as the positive
44-percent return generated in the first
year of the Investment Office's operation,"
the two wrote. "These widely different
See ENDOWMENT, Page 7A
A HISTORIC DECLINE
For only the second time in the past two decades, the University's
endowment lost value over the previous fiscal year.
3 3.6 4
'07 '08 '09
0.4 0.5 06 08
'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00
'01 '02 '03 04 '05 '06
Yur Source: University Report on Investments
WORKING THE PHONES
At busy meeting, regents also
get update about the state of
H1N1on campus and approve
Daily News Editor
Speaking at the University's Board of Regents
monthly meeting yesterday, Stephen Forrest, vice
president for research, announced a
new committee had been formed to NOTEBOOK
explore how the University handles
culturally unidentifiable human remains.
The Advisory Committee on Culturally Unidenti-
fiable Human Remains, which consists of 10 faculty
members and one graduate student, will advise For-
rest on how to handle requests from Native Ameri-
can tribes for the transfer of culturally unidentifiable
human remains currently being housed in the Univer-
sity's Museum of Anthropology.
The University has come under fire in the past for
refusing to release remains, which Native American
tribes have claimed are rightfully theirs. The Univer-
sity has maintained that the remains are not identi-
fiable and that under the Native American Graves
Protection and Repatriation Act the University is
required to maintain possession of the remains until
final regulations are released or the Secretary of the
Interior explicitly directs the release of the remains.
New regulations are expected to loosen restrictions
and to dictate how the University and other organi-
zations should distribute culturally unidentifiable
Though no new rules have been handed down yet,
Forrest said he hopes that the University will "do the
right thing, be proactive and be prepared for antici-
pated changes in federal rules."
Prof. Phil Deloria, a member of the new committee,
said he looks forward to serving on the committee.
"It's something that's concerned a lot of native
students and lot of native faculty on campus, myself
included," Deloria said. "My sense is that what this
committee will do is look at these from a critical intel-
lectual, ethical sense of positions and try to offer
However, Fred Harrington, a former member of
the Lake Traverse Bay Bands of Odawa Indians tribal
council, said he doesn't see a need for the committee.
"I don't understand what possible good a commit-
tee can do," he said. "I don't understand how (the
University) can continue to hold the remains of tribal
ancestors in their museum unless they've followed
the law, so I'm not sure what they're doing with the
See NOTEBOOK, Page 7A
University alum Chris Wolff of Organizing for America makes calls to Michigan residents yesterday along with other members of the organization and the campus chapter of the College
Democrats. The calls targeted established President Barack Obama supporters, asking them to contact their representatives and urge them to support Obama's health care reform efforts.
The University's chapter of the College Democrats are in competition with their counterparts at Michigan State to see who can contact the most people and net the most pledges.
THREE-WHEEL E D CAoBSe
Pedicabs add leg power
MICHIGAN STUDENT ASSEMBLY
In COnvention, MSA
to Ann Arbor taxi scene to rework constitution
Two students from
carriages on the cheap,
By GRACELIN BASKARAN
For the Daily
Ever pay your cabbie with a bur-
Didn't think so.
But if you took a pedicab, you prob-
ably could have.
Thanks to Business School sopho-
more Calvin Schemanski, pedicabs
- bicycle-powered taxi cabs - have
O come to Ann Arbor. And their drivers
will gladly take your burritos.
Schemanski and Grand Valley
State University sophomore Josh
Lycka opened Petoskey Pedicab, LLC
this summer in their hometown of
Petoskey, Mich. And in the fall, Sche-
manski brought the business back to
school with him.
"People think it's really cool and
respect the fact that we bike around
to make a living," Schemanski said.
The carriages sit on two wheels
and are pulled through the street by
a man-powered bicycle.
Hundreds of cities across the coun-
try currently have pedicab services,
including New York, Chicago and San
Last winter, Schemanski and
Lycka were trying to come up with
something they could do during the
summer to make some money.
"We were both working in a kitch-
en last winter and we were talking
about different things we could do
during the summer and the bike thing
came up," Schemanski said. "Then we
realized it could be plausible and we
looked into it, thought we could do it
and went for it"
Because of newly passed legisla-
See PEDICABS, Page 7A
Document sets student
rights, campus group
rules, funding framework
By MALLORY JONES
The Michigan Student Assembly will
launch a constitutional convention in
the next few weeks to revise the Univer-
sity student constitution - all in hopes
of bringing legitimacy back to a docu-
ment that many students on campus
don't even know exists.
MSA student General Counsel Jim
Brusstar, who also serves as secretary
of the convention, said the student con-
stitution - which was written in 1986 -
needs some major revising.
"It's very broken up," he said. "It
doesn't have the kind of logical flow
that it should. It's not very clear about
some things. There are some parts that
are even contradictory. I mean there are
even some spelling errors."
edge of the constitution and knows what
he would like to see changed, he said
discretion will ultimately be left up to
the students involved in the convention.
"We wanted to involve people who
might not otherwise be involved," he
said. "Ultimately everyone does have a
stake in this."
The student constitution outlines the
structure of all student governments,
establishes the rights of student groups
and students and states the way in which
these groups interact, said Brusstar.
The constitutional convention will
have the chance to revise any of these
structures, from the large-scale ques-
tions like the purpose of student gov-
ernment to more practical questions
like how MSA distributes funds to stu-
MSA officials hope to make the docu-
See CONVENTION, Page 7A
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NEW ON MICHIGANDAILY.COM
In bike accident, President Coleman breaks wrist.
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Vol. CXX, No.29 OPINION .... .. .............4A SPORTS ................... ... BA
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