The Rice Thresher (Houston, Tex.), Vol. 69, No. 30, Ed. 1 Friday, April 23, 1982 Page: 7 of 24
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Endowment gathers income...
Chemical
6%
Other Industry
14%
Financial
8%
High Technology
17%
Retail
12%
Energy
24%
Other
11%
Investments by industry
Breakdown by industrial groups for stocks and bonds
held on June 30, 1980
continued from page 1
expendable income over the long
term. The long term is what is
important, for example we're not
really following the bond market
for short term transactions. We
Compensation for five highest
paid employees
Including salary, pension plan
contributions, and expenses, for year
ending June 30, 1980
Norman Hackerman
President $111,100
Joseph Nalle
Treasurer $70,127
R.R. Sterling
Jones School Dean $66,000
William W. Akers
VP., External Affairs $72,300
John Margrave
VP., Advanced Studies $69,800
predominately in capital
as opposed to commercial
to build the investment
invest
stocks
paper
base."
Information compiled from tax
returns for fiscal year 1980 (ending
June 30, 1980) reflects that
investment policy (see chart). The
returns were obtained from the
Internal Revenue Service under
open records laws that open tax
returns of tax-exempt organi-
zations to public inspection.
Returns for FY 1981 are currently
unavailable.
According to the returns for FY
1980, Rice earned $12.9 million in
dividends on investments totaling
$194.6 at the end of the year
(average 7 percent return) and $4.0
million in interest on bonds
totaling $42.2 million (average 10
percent).
Oil and gas money is
unquestionably thef- stalwart of
Rice's investments. Almost one-
fourth of all marketable securities
in FY 1980, were invested in
energy-related companies.
"Our oil and gas interests, are*
unique for a university," Wise said.
"They have been a real strength for
Rice, providing a continuous
stream of spendable income
through the year."
In addition, oil and gas royalties
totaled $4.9 million in FY 1980 and
$8.6 million in FY 1981. Rice owns
oil and gas rights to about SO plots
in East Texas and Louisiana, Nalle
said. Most of that property has
been acquired through purchases,
beginning with the purchase of the
Rincon oil field in 1943. Land, on
the other hand, has been acquired
primarily through gifts and
bequests.
Besides securities and property,
the university also wholly owns
five corporations: Rice Land and
Lumber, R.I. Patents, R.U.
Corporation, South Main, Inc.,
and Rice Trust, Inc. The first four
contributed $1.9 million to the
endowment and $83,000 to current
funds in FY 1980 and $2.7 million
to endowment and $36,000 to
current funds in FY 1981.
Rice Trust administers assets to
various trusts "subject to the life
income interests of certain
beneficiaries," says Rice's annual
report. Generally, Rice does not
own the principal, but keeps the
income gained from the asset, Wise
explained. Often the principal is
given to Rice after the donor or his
Five highest paid persons for
professional services
Year ending June 30, 1980
Fayez Sarofim and Co. $352,000
Investment counselor
Baker and Botts $34,000
Legal counsel
Arthur Andersen & Co $96,000
Accountants
IBM $221,000
Service contracts
Barney Gissen $31,000
Countinuing Education
heirs die or after the conditions of a
will are fulfilled. Rice Trust
administered securities worth $8.9
million in FY 1980 and securities
worth $15.3 million in FY 1981. In
addition, it holds $3.7 million in
land (April 1973 appraisal).
Rice also earns money in a few
more interesting ways. For
example, Rice owns large
quantities of stocks for long-term
gains that usually sit in vaults.
Occasionally brokers will borrow
some of these stocks to complete a
transaction in which they need the
actual certificates. They will then
give Rice deposits equal to or
greater than the current value of
the stocks until they can return the
certificates. Meanwhile, Rice can
invest the money the broker puts
up as collateral and keep whatever
income they earn from it, Wise
said. Rice then essentially earns
free money.
"I wish we could lend more, but
there just isn't that much of a
demand for it," Wise commented.
At any given time Rice will hold
about $10 million in such
collateral. These shorter-term
investments are handled by the
treasurer's office.
In past years, Rice had a few
other interesting investments.
About 20 years ago, Rice owned an
interest in Yankee Stadium, but
not the land, Nalle relates.
Eventually, the City of New York
exercised the right of eminent
domain and condemned the
property.
"We would have been happy to
hold on to it because it was
income-producing," Nalle said.
In addition, Rice owned the
Rice Hotel, which was built by
Houston financier Jesse Jones on
land owned by William Rice.
When the hotel began losing
money, however, Rice was forced
to sell it because they were not
allowed to mortgage it, according
to Nalle.
The income tax for FY 1980 also
shows the five highest fees paid to
persons for professional services
and the compensation for the five
highest paid employees (see
charts). A total of ten companies
receive fees over $30,000 and 113
employees receive compensation
over $30,000.
Top 50 investments
As of June 30, 1980
Corporation
1 IBM
2. General Motors
3. Standard Oil of Indiana
4. General Electric
5. Phillip Morris
6 Exxon
7. Pennzoil United
8. Texas Eastern
9 American Express
10. Federated Dep' Stores
11. Aetna Life
12. Royal Dutch Petroleum
13. Coca-Cola
14. Loews Theatres
15. Eli Lilly
16. Halliburton
1 7. Mobil Oil
18 R.J Reynolds
19 Standard Oil of California
20 Sears Roebuck
21 Teledyne
22 Pepsi-Cola
23. AT&T
24. GTE
25. Xerox
26. CBS Inc.
27 Pacific T&T
28. Boise Cascade
29. Safeway
30. Mesh Petroleum
31. Kerr-McGee
32. Rotan Mosle
33 McDonnell Douglas
34. New York Telephone
35. DuPont
36. American Cyanamid
37 Eastman Kodak
38. Atlantic Richfield
39. Avon
40. Shell Oil
41. Cooper Industries
42. Cameron Iron Works
43 Warner Lambert
44. Transamerica
45. Texas Instruments
46. International Paper
47 First City Bank
48. New Jersey Bell
49. IT&T
50. Conn. Gen. Insurance
Totals
(all companies including those
not listed)
Securities (millions of dollars)
3nds
Stocks
Total
—
154
154
—
96
96
—
89
89
—
6.8
6.8
—
62
6.2
—
4 8
4.8
0.4
4.4
48
1.3
3.5
4 8
—
4 1
4 1
—
4 1
4 1
—
40
4.0
—
3.9
3.9
—
3.8
38
3.7
—
3.7
—
3.5
3 5
—
3.5
3.5
0.5
2.9
34
—
34
34
—
3.3
3 3
—
3.3
3 3
1.7
1 6
• 3
—
32
3 ?
—
3.2
3.2
3.1
—
3 1
—
3 1
3.1
1 0
2 1
3 1
30
—
30
—
30
3.0
30
—
3.0
—
2.9
29
—
2.7
2.7
—
2.7
27
—
2.7
27
2.7
—
2.7
—
2.6
26
1.0
1.5
2.5
—
2 5
2.5
—
2.4
24
—
2.4
24
—
2.3
2 3
—
23
23
—
2.3
23
—
22
22
—
2.2
22
—
2.0
2.0
—
2.0
20
—
1.9
1 9
1.6
—
1 6
—
1 5
1 5
—
1.5
1 5
42.2
194.6
236 8
Graduation weekend
commences at
the Shamrock Hilton.
In honor of the graduating Rice students, the Shamrock Hilton is
offering special graduation weekend rates, good only from May 6 thru
May 10. Just down the street from the campus, your family will enjoy
resort-like facilities, yet still be close to you. The Shamrock's tennis
center and world's largest hotel swimming pool are a delight for exer-
cise and relaxation. And our dining facilities, which include exotic
Trader Vic's and the refreshing Terrace Restaurant, are a diner's para-
dise. Jaor added convenience, the Shamrock's airport bus terminal is
right across the street, and provides direct service to both airports.
Special weekend rates from May 6 thru May 10 are:
• Single Room—$47.00 per night
• Double room—$57.00 per night
• Parlor with one bedroom—$100 per night
• Parlor with two bedrooms—$ 150 per night
To get these special graduation weekend rates, you must make
your reservations by May 2. Children stay free in the same room as
their parents. Call now for your reservations at 668-9211 and ask for
the graduation weekend special.
• /////< //
The Houston Hotel America Knows Best.
6900 S. Main at Holcombe
Houston. TX 77030
Offer subject to availability and not good if attending a meeting or convention
The Rice Thresher, April 23, 1982, page 7
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Grob, Jay. The Rice Thresher (Houston, Tex.), Vol. 69, No. 30, Ed. 1 Friday, April 23, 1982, newspaper, April 23, 1982; Houston, Texas. (https://texashistory.unt.edu/ark:/67531/metapth245502/m1/7/: accessed July 18, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting Rice University Woodson Research Center.