The University of Wisconsin has seen a drastic increase in the amount of private funds flowing into programs on campus though UW Foundation.

The National Association of Colleges and University Business Officers released the preliminary results of the Commonfund Study of Endowments on Thursday. The results showed the endowment value for UW Foundation increased 13 percent, growing from $1.37 billion in 2009 to $1.55 billion in 2010.

The UW Foundation is a nonprofit organization that raises private funds, makes investment decisions and then channels the funds back into the university.

Tom Olson, UW Foundation chief investment officer, said while the increase in the endowment market makes it appear as if the amount of gifts UW receives has increased, this is not the case.

The endowment market value represents the return from investments made with gifts and the total amount received in gifts by an organization, he said.

“The endowment value goes up for two reasons,” UW Foundation President Mike Knetter said. “One, the endowment is invested in various financial and real assets whose values rise …and two, new endowment gifts are made.”

The increase from 2009 to 2010 mostly reflects an increase in return on investment, Knetter said. The new gift flow for UW slightly decreased that year.

Knetter said the increase in endowment value will benefit the UW campus and help to fund various programs for students on campus.   

“The funds go into two broad areas. A lot of money goes towards scholarship support and also faculty support,” Knetter said. “Some is also directed to targeted programs that benefit both students and faculty.”

Knetter said the increase in return on the investment may also reflect a rebound from the recession.

According to the study, the reported national average of return on investments for the fiscal year 2010 was 11.9 percent.

The study also said the national trend has shown a marked improvement from the year before, when the average return was 18.7 percent.

Most endowment values at universities saw similar improvement from the year 2009 to 2010, Knetter said.