USC to Share $365-Million Annenberg Gift to 4 Schools : Endowment: The campuses are recipients of largest cash donation in U.S. education. USC will get $120 million.

In what experts say is the largest cash donation in American education’s history, the foundation funded by publishing magnate Walter H. Annenberg is giving a total of $365 million to three universities and a New Jersey prep school, including $120 million for communications programs at USC.

Even taken separately, the donation to USC and an identical amount to the University of Pennsylvania reportedly set new records in higher education for cash gifts, as compared to stocks and delayed royalties. Annenberg’s $100 million to the Peddie School, the academy he attended, marks a new high in secondary school philanthropy, officials said. In addition, Harvard University is to receive $25 million.

“It’s a very important thing in my life because there is nothing of greater importance than preparing the youth to run our country,” Annenberg, 85, said in a telephone interview from his foundation office near Philadelphia. “Education is the key.”

Unlike other large donations that often are paid over many years, Annenberg’s pledges are to be fully paid in cash by the end of this year.

Annenberg, the former owner of TV Guide and U.S. ambassador to Great Britain during Richard Nixon’s presidency, said he hopes his gifts “will inspire other foundations to double their efforts to aid education.”

His past support of learning includes a 1990 pledge of $50 million to the United Negro College Fund, as well as large donations to communications schools that bear his family name at USC and at the University of Pennsylvania.

At the Council for Aid to Education, a New York-based organization, research director David Morgan described Annenberg’s $365 million as “probably the largest transfer of individual wealth to the education sector” in one action. “It sounds pretty enormous to me,” he said.

That Annenberg intends to fully pay the pledges by the end of the year is very unusual, even for a man whose estimated $2.5 billion ranks him 80th in Fortune magazine’s new listing of billionaires worldwide and who recently paid $57 million for a Van Gogh painting that he donated to the Metropolitan Museum of Art in New York.

The single largest pledge to American higher education since 1967 was $125 million to Louisiana State from oil billionaire Claude B. Pennington in 1981. But that was partly in stocks and oil royalties that are still being paid out, according to the Chronicle of Higher Education, the trade newspaper for colleges and universities.

An official at the Foundation Center, a philanthropy research group in New York, stressed that large donations made further in the past may be worth more if adjusted for decades of inflation.

That kind of hair-splitting does not interest the grateful recipients of Annenberg’s money, particularly at a time when budget-stressed universities and schools nationwide are cutting spending and staffs.

At USC, President Steven B. Sample delightedly described the $120 million as “a wonderful vote of confidence in Los Angeles” and in the university’s efforts to keep the city a leading center of the communications and entertainment industries.

The money will be used to start a new Annenberg Center for Communications, an umbrella organization that will fund programs, faculty hirings, scholarships and equipment in the existing USC schools for cinema-television, journalism, engineering and communications.

Those academic units will remain independent of one another and the new center will not control them. Sample confirmed that a possible merger of USC’s journalism and communications schools has been under consideration for some time, and is unrelated to Annenberg’s gift.

Sample emphasized that the money will be used mainly to promote cross-disciplinary work in computers, information science, video, sound, fiber-optics and news gathering. “Those traditional boundaries are blurring,” Sample said.

Annenberg insisted that he is not trying to dictate any mergers of USC programs. “That’s for the university to decide.” However, he added: “The theory of collaboration among the schools is very positive because the new technologies are so big.”

Ambassador Annenberg, as he prefers to be called, has given USC $50 million over the years, including about $6 million from a $24.6-million pledge he made last year for USC’s communications programs, according to a campus spokesman.

The remainder of that $24.6 million will be paid with interest from the new donation and will create an overall communications endowment of $150 million. That new endowment is expected to generate about $12 million a year.

Annenberg has personal or family ties to the four institutions receiving his new gifts. His daughter, Wallis Annenberg, has been a USC campus trustee since 1971.

Annenberg attended the University of Pennsylvania, an Ivy League institution where his donations will aid the communications school and establish a public policy center.

The $25 million to Harvard for scholarships, undergraduate seminars and a social-dining facility will memorialize his son Roger, who died while he was a senior at Harvard in 1962.

The Peddie School, in Hightstown near Princeton University, is said to have special meaning for Annenberg because it admitted him in the 1920s when other elite academies restricted admissions of Jews.

Peddie officials said it was apt that Annenberg’s $100 million for increased scholarships and higher faculty pay is being formally announced on Father’s Day, inasmuch as he long has been a patriarch to the coeducational campus, previously giving it $40 million. Students are sending him two dozen mixed-colored roses today in thanks.

“What this does for our school is so extraordinary,” said Anne L. Seltzer, Peddie’s development director. “This catapults our endowment from $17 million to $117 million.” (Peddie’s tuition is $12,900 a year and less than a third of its 500 students receive scholarships.)

The Annenberg Foundation had assets of nearly $1.5 billion last year, making it the 11th-richest foundation in the country, according to Loren Renz, vice president for research at the Foundation Center. “We’re talking big,” she said.

Among the newspapers and magazines owned in the past by Annenberg’s Triangle Publications are the Philadelphia Inquirer and Philadelphia Daily News, Seventeen, Daily Racing Form and TV Guide.

In 1988, he sold the company to Rupert Murdoch’s News Corp. for $3 billion and increasingly turned his attentions to philanthropy and collecting Picassos, Gauguins and Van Goghs. He lives most of the year near Philadelphia and winters at Sunnylands, his 250-acre estate in Rancho Mirage, where he has hosted Presidents, including Ronald Reagan and George Bush.

Other than chronic sinus problems, Annenberg said his health “is fine to the best of my knowledge and belief.”

He said he hoped that people would not think his latest gifts meant that his charitable foundation is ending. “I expect to be around for a while and I want to be as constructive as I can,” he said.

Giving for Learning

Until Walter H. Annenberg announced his $365-million gift to three universities and a prep school, the 10 largest private donations to higher education since 1967 were:

* Louisiana State: Claude B. (Doc) Pennington, $125 million; stock, gas and oil royalties; 1981.*

* Emory: Robert W. Woodruff, $105 million; stock; 1979.

* Rowan College of N.J.: Henry M. and Betty L. Rowan, $100 million; stock and cash; 1992.*

* Regent: Christian Broadcasting Network, $100 million; interest-bearing note convertible to stock; 1992.**

* Stanford: David Packard, $70 million; stock and cash; 1986.

* Columbia: John W. Kluge, $60 million; cash, stock and bonds; 1993.*

* U. of Miami: James L. Knight, $56 million; charitable trust; 1986.*

* Texas A & M: Dwight Look, $52 million; land; 1992.

* U. of Houston: John and Rebecca Moores, $51.4 million; stock; 1991.

* Caltech: Arnold and Mabel Beckman Foundation, $50 million; cash and stock; 1986.*

Note: The value of the gifts is based on information from the institution or donors at the time the gifts were promised. In cases of stock, property, art and other non-cash donations, actual value may have increased or dropped.

* Full amount of gift not yet received.

** CBN and Regent are separate legal entities, but CBN’s directors select the university trustees and CBN provides financial and other support to Regent.

Source: Chronicle of Higher Education, April, 1993