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UMaine trustees approve 0.5-point increase to UMaine endowment management fee and set FY27 spending rate at 4.5%
Summary
The University of Maine System Investment Committee approved raising the management-fee portion of the UMaine endowment for FY27 from 1.25% to 1.75%, a change expected to generate about $468,000 for the University of Maine, and separately approved a 4.5% overall endowment spending rate for fiscal 2027.
The University of Maine System Investment Committee on Dec. 1 approved two changes to endowment policy affecting UMaine funds: a 0.5 percentage-point increase to the management-fee portion of the UMaine endowment spending rate (from 1.25% to 1.75% for fiscal year 2027) and a 4.5% overall endowment spending rate for FY27.
President Joan Ferini Mundy introduced the fee increase, saying the change would "increase the spending rate from 1.25% to 1.75% effective for fiscal year 27," and that the adjustment would help the university in "challenging budget times." Jenny, a University staff member presenting details, said the fee change would have "about a $468,000 impact to the University of Maine budget and and will help offset some of our structural gap for the next year." The committee discussed how the System-managed funds differ from gifts held and managed by the University of Maine Foundation.
Trustees raised questions about donor treatment and whether charitable giving vehicles would be affected. Trustee McMahon asked whether charitable remainder trusts invested in the funds would see reduced income payouts; committee staff and Tracy (system staff) said they would check specifics but explained that the fee applies to assets held in the System-managed Investment Pool (MIP) rather than to outright gifts, and that charitable gift annuities become part of endowments only after the beneficiary’s death.
After discussion, Trustee Worth moved to approve the resolution increasing the management-fee portion of the UMaine endowment spending rate to 1.75% for FY27; the motion was seconded and carried on a roll-call vote. The committee then reviewed and approved a separate resolution to set the FY27 endowment spending rate at 4.5%, a recommendation Tracy said was supported by NEPC's long-term return assumptions and would yield an estimated $6.85 million in distributions for FY27 (including internal management fees).
The committee recorded no abstentions; the clerk reported trustees as voting yes on the motions and the chair announced that both motions carried. Tracy and staff said they would coordinate with the University of Maine Foundation to ensure donor communications are clear for funds routed through different entities.
The committee moved next to its regular investment updates and reviews.
