OTTAWA --  Two Canadian universities - University of Toronto and University of British Columbia - are among the 75 wealthiest institutions of higher learning in North America, rating in an exclusive billionaires' club of schools with financial endowments that have surpassed $1 billion.

A new U.S. survey shows that American and Canadian universities secured impressive returns on their endowment funds last fiscal year, experiencing the largest gains in a decade and putting the two richest Canadian universities in elite company in their fundraising and investment ventures.

"They're certainly in there with the big guys," said George Dew, a senior analyst with the Canadian Association of University Business Officers, who ventured that McGill University in Montreal will crack the billion-dollar mark in the near future.

University of British Columbia saw its endowment fund swell to just over $1-billion for the first time in the fiscal year ending last June 30, ranking 75th of the 785 post-secondary institutions in the survey, which was conducted by the conducted by the National Association of College and University Business Officers in Washington, D.C.
The Vancouver-based university enjoyed a 31-per-cent return on its investments, outpacing the vast majority of North American institutions.

University of Toronto topped Canadian universities with the 33rd wealthiest endowment fund, which ballooned to almost $1.8-billion last year, a 25 per cent increase over the previous year.

An endowment is a donation which is invested. The principal remains intact and the university can spend the investment earnings, typically on such things as scholarships, fellowships, bursaries, and professorships.

Only 76 universities owned endowment riches worth more than $1 billion, led by Harvard University, which had a fund with $34.6 billion. Only seven Canadian institutions were included in the survey.

McGill's endowment fund, at $863 million, ranked 88th. University of Alberta had a fund worth almost $723 million, an increase of 30 per cent over the previous year. Queen's University's fund was valued at about $615 million.

The top Canadian schools are not the norm, said Dew. The latest Canadian survey, based on figures from the 2006 calendar year, revealed that the bulk of endowment wealth is concentrated among only a handful of institutions. At the end of 2006, the collective assets of Canadian funds broke $10-billion and the average endowment fund was worth $151 million. The median fund value, however, was $38 million, meaning that half of the 69 universities in the survey had funds worth less than that.

Despite impressive earnings last year, the universities in the American study spent an average of 4.6 per cent of the assets, sparking accusations that they were hoarding their riches.

Last week, members of the Senate finance committee in the U.S. called for reduced tuition rates as they sent letters to the 136 institutions with endowments of at least $500 million inquiring about how they spend their investment earnings.

"Tuition has gone up, college presidents' salaries have gone up, and endowments continue to go up and up. We need to start seeing tuition relief for families go up just as fast," Republican Senator Charles Grassley said in a statement.

Some U.S. schools have said that their funds slowed in growth in the second half of 2007 and that they need their cushion to protect their funds from an economic slowdown or a possible recession.

Dew said that Canadian universities typically spend a fixed percentage of the value of the fund and they take a long view of investing rather than spending all their gains in economic good times. The common practice means there is more spending when their returns are high, and more investing as well. His group does not track the Canadian spending rate.

While Canadian endowment funds performed poorly in the early years of the century, they have exploded in value by 55 per cent in the last five years as a result of more generous gift giving and market performance.