Further details provided on Wilson School fellowship funding

July 4, 2006 noon

Princeton University has provided New Jersey Superior Court Judge Neil H. Shuster with further details concerning funding for fellowships in the Woodrow Wilson School of Public and International Affairs, and specifically for a three-year trial program known as the Graduate Funding Agreement (GFA). The information was submitted in connection with the lawsuit regarding the Robertson Foundation, which was established in 1961 to support the graduate program of the Woodrow Wilson School.

In addition to clarifying the allocation of funds for Woodrow Wilson School fellowships and the GFA program, the University also reaffirms that the costs of the Graduate Funding Agreement were well within the scope of appropriate and permissible charges to the Robertson Foundation. The program was intended to bolster the Woodrow Wilson School’s program by strengthening the research infrastructure in closely-related academic departments, thereby attracting and supporting the School’s own faculty members, many of whom hold joint appointments in those departments.

The GFA operated in the years 2000 through 2002. It was established by former Woodrow Wilson School Dean Michael Rothschild to support Ph.D. students in three departments -- Economics, Sociology and Politics -- that are closely related to the School. During those three years, the University contributed more than $2.4 million from non-Robertson Foundation sources to support the 22 Woodrow Wilson School graduate fellowships that the University was obliged to support under the Foundation’s funding formula. Furthermore, during this same period the University also contributed more than $3.1 million in additional fellowship support above the amount required for the 22 fellowships.

Thus, when the University created the GFA program on a trial basis, it was already making a significant excess fellowship contribution to the Woodrow Wilson School. Its fellowship contribution of more than $5.5 million from non-Robertson sources over the duration of this program covered , on average, the cost of not 22, but more than 50 graduate student tuitions and stipends per year -- approximately 28 of which were fellowships properly viewed as part of the School’s expanded graduate program, which the Foundation was established to support.

In submissions to the Court in March, the University stated that funds to support the GFA fellowships came from University funds, not from Robertson Foundation funds. Princeton’s further review of the relevant accounting data has shown that while this was the intention when the GFA program was implemented, no procedural action was taken by the University to redirect non-Robertson Foundation funds to that specific use. Instead, the non-Robertson Foundation funds that could have been redirected to this program continued to be used to support Woodrow Wilson School fellowships beyond the University’s obligation. If University funds had not been used to support these fellowships, they otherwise would have been charged to the Foundation. While the total funding for the GFA program from the Robertson Foundation was $782,376, the excess Woodrow Wilson School fellowship support from the University amounted to more than $3.1 million.

Princeton has continually asserted that the lawsuit, filed in July 2002 by members of the Robertson family, is without merit. In motions filed earlier this year, the University sought summary judgment on several key issues in the case, including a reaffirmation that Princeton University is and will continue to be the sole beneficiary of the Robertson Foundation, as provided by the Foundation’s Certificate of Incorporation, and that the Foundation’s decision to retain Princeton University Investment Company (PRINCO) to manage the Foundation’s investments represented a good faith exercise of its independent business judgment.

In its filings, the University has demonstrated that it and its designated trustees of the Foundation have effectively carried out the mission of the Foundation over the past 45 years; met their fiduciary obligations in overseeing the Foundation’s assets and expenditures; contributed to a substantial strengthening of the graduate program of the Woodrow Wilson School; and significantly enhanced the governance practices of the Foundation in recent years, despite continuing opposition by members of the Robertson family.