As the coronavirus pandemic continues to roil global financial markets, colleges and universities around the United States are entering uncharted economic waters. In Brunswick, Bowdoin is battening down the hatches. “It is really too soon to know how severe the impact will be or how this compares with economic challenges of the past, but there is no question that this is a very difficult environment for investments,” wrote Matt Orlando, the senior vice president for finance and administration and treasurer of the College, in an email to the Orient.
The 2018-19 fiscal year marks the first time that colleges will be subject to a tax on endowment returns as a result of a provision in the 2017 Tax Cuts and Jobs Act. This provision applies a 1.4 percent excise tax on the net investment income of college endowments greater than $500,000 per student.
The College announced on Friday that the endowment generated an investment return of 12.4 percent for the fiscal year that ended June 30, 2017. The endowment had a market value of $1.46 billion on June 30, up from $1.34 billion at the close of FY 2016.