With economic growth slowing and key stock markets closing well below their record highs, officials at Northwestern and other colleges are hoping a cooling economy won’t put a damper on their fund-raising campaigns.

Stanford University has raised almost half the money for its $1 billion Campaign for Undergraduate Education, and donations have remained steady, said Robert Pringle, Stanford’s associate vice president for university development.

But donors are taking longer to fulfill their obligations, Pringle said, and if the economy enters a prolonged slump Stanford’s luck might not hold out.

“We’ve had a record year,” he said. “(But) we’re crossing our fingers that we’re not going to see the bottom fall out three months from now.”

Taking advantage of a decade-long economic boom, 15 universities have embarked on billion-dollar capital campaigns, and nine more have already completed them, according to the Chronicle of Higher Education.

But in the last month, two key indicators of economic stability have shown signs of a slowdown. On Jan. 31 the Federal Reserve cut interest rates by half a percentage point for the second time in a month. And last week the Conference Board’s index of consumer confidence fell dramatically.

Giving to Campaign Northwestern has remained high so far, but fund-raising efforts could falter if the economy enters a full-scale recession, said Ronald Vanden Dorpel, vice president for university development.

NU raised $29 million in the last two months, he said, which is on pace with the rest of the campaign.

“If it’s a true economic recession, we know from experience that gifts tend to slow down a little bit,” he said. “We’re hardly in a recession right now. The economy is still very strong; people still made a lot of money in the stock market.”

Gifts for Campaign Northwestern, the university’s effort to raise $1.4 billion by August 2003, have surpassed $1 billion.

But University President Henry Bienen said reaching the target will “come down to the wire.”

“I’ve always thought the goal was a stretch,” Bienen told The Daily in January. “I’ve never thought it was a lay-up. There’s no magic formula — you organize yourself and you get lucky.”

‘HARD TO PREDICT’

Across the country, donors are taking longer to finish paying their gifts but are continuing to promise money to universities, said Laura Forman, a spokeswoman for the Council for the Advancement and Support of Education.

Though donations have not yet slowed, if the economy enters a full recession universities could feel the impact as well, she said.

“It’s too soon to tell,” Forman said. “There really has not been a measurable impact at this point, but it’s hard to predict.”

The University of California at Los Angeles has raised about $1.4 billion of its $1.6 billion goal and has seen gift-giving remain steady despite pessimism about the economy, said Carol Buge, UCLA’s director of campaign operations. She said university officials cannot yet determine what impact a slowing economy will have on the campaign.

Donors pay most large gifts over a span of about five years, Forman said. If the economy slows significantly, she said, donors might be more reluctant to pay their gifts — or could renege on their obligations altogether.

Vanden Dorpel said consumer pessimism has made it more difficult for NU administrators to secure gifts. Although gift-giving remains strong, he said, administrators have been forced to put more energy into securing individual donations.

“We’re finding that it’s taking people a little longer to decide,” he said. “People are saying, ‘I’m OK now, but maybe I should save up for the future.’ “

Bienen said administrators will redouble their efforts to counter the effects of a slowing economy.

“Campaign Northwestern isn’t insulated from what happened in the stock market,” he said. “We’ve seen a very precipitous change in consumer confidence. It just means I have to work harder and am running around more.”

But whether or not the economy is entering a recession, if consumers anticipate a slowdown they will curb donations, said economics Prof. Gadi Barlevy.

“People always act rationally based on their expectations,” he said. “Even if the economy doesn’t slow down, just because there are signs that it could, people adjust their expectations and act in respect to those. You don’t have to see people’s income actually fall for them to hold back on spending.”

Barlevy said a real or perceived slowdown probably will not affect the spending of wealthier people, who are most likely to donate to capital campaigns. If stock prices fall dramatically, however, even people with higher incomes could feel the pinch, he said.

STOCK IN TRADE

And Forman said gifts of stock, which have become increasingly common in the last five years, could easily lose most of their value if the stock market crashes.

“If someone in good faith donated $1 million, and the stock took a tumble, (the university) could lose 90 percent of the value of that stock,” she said. “There’s always some risk.”

Stanford, located in the heart of Silicon Valley, receives many of its gifts in technology stock, Pringle said.

“Some (technology) stocks are highly volatile,” he said. “They’re up and down 5 to 10 percent of their value in a single day. When we know we’re getting that kind of gift, we’re on point to really watch that.”

Vanden Dorpel said most of NU’s large gifts come in the form of blue-chip stock, which is less susceptible to fluctuations in the economy.

“We don’t have lots of shrinking pledges,” he said. “I don’t think you could say there’s an increased risk.”

When NU receives a gift of stock, the university sells it almost immediately and reinvests the money with the rest of the university’s endowment, said Lorraine Dostal, an investment analyst for NU.

But if the stock market drops immediately after the donor gives the stock, NU could lose money before it has the opportunity to sell the shares, she said.

“We try to sell it almost the day we get it,” she said. “Sometimes, we will receive a stock that’s valued at $75 a share, but when we sell it, it’s at $70. We’d hope that over the course of a year, the things that go up would outweigh the negative. In general, we’ve done OK.”

Despite the signs of slowdown, Vanden Dorpel said he remains optimistic that Campaign Northwestern will meet its goal.

“It’s a stretch,” he said. “We don’t know what the economy is going to look like. We have so many major projects to complete the funding for. But we’ll work at it, and if we (keep) the same trajectory, we’ll make it.”