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Caption: Book - History of the University (Nevins)
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84 BEGINNINGS OF THE UNIVERSITY posed of, and the endowment brought up to about $350,000, for upon the income from this the University had to live. By spending only about $35,000 to $40,000 for running expenses, the University for a time had interest enough to meet them; while before 1872 there were two liberal biennial appropriations from the Legislature, one for $60,000 and one for $120,000, for extraordinary expenses. An unsuccessful effort was early made to obtain a regular appropriation for agricultural experiments. But about 1875 the pinch began to be felt. Three years before this the Legislature had failed to appropriate the money needed to complete University Hall, and the loss of that sum from its endowment had affected the institution's revenues. But the main cause of alarm was that various financial circumstances had greatly depreciated the rate of interest on the Uni* versity's bond holdings. At this time Michigan, with an annual income of $100,000, and Cornell, with $110,000, were severely restricted; the case of Illinois was much worse. The endowment of the University had by legislative direction been invested in State, county, and municipal bonds, at rates on many of from eight to ten per cent. But the "loosening" of money after the panic, with a succession of harvests that brought much cash into Illinois, reduced these rates by nearly one-half. In 1876 the income from endowment reached its highwater mark--$32,543; thereafter it steadily declined, for the securities all carried an option of redemption after a specified time. For the year ending March, 1877, it had dropped to about $29,000, for 1878 to about $25,500, and for 1879 to about $20,500. For some years thereafter it hovered at about $20,000—a sum altogether inadequate.
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