You have /5 articles left.
Sign up for a free account or log in.
A Missouri judge agreed Wednesday to let Avila University dip into millions of dollars of restricted endowment funds to cover financial aid and scholarship costs that the private institution says it would otherwise be unable to afford over the next two years.
The order from Jackson County Circuit Court Judge Justine Del Muro responded to the university’s petition last month asking that it be permitted to use the principal from 97 different endowment funds because it “will be unable to meet its scholarship goals for students in need because [its] limited resources will be insufficient to fund the necessary scholarships and institutional aid for students,” the judge wrote.
The judge said in the order because “all of the restricted endowments were established to fund student scholarships … relaxing the restrictions on the 97 restricted endowments … is fully consistent with and supportive of the purposes for which the restricted endowments were original established.”
Missouri’s attorney general, who is listed as the respondent in the court case, did not contest Avila’s petition. Missouri law allows a nonprofit to petition a court to spend endowment principal over donor restrictions if they become “illegal, wasteful or impossible to carry out.” An article last month in The Kansas City Beacon, a nonprofit news outlet in Missouri, quoted a longtime higher education finance expert as saying he did not believe Avila’s petition met that test.
“The donors’ intent takes precedence over the institution’s needs,” said Larry Ladd, a consultant with AGB Consulting.
