The governor’s office is requiring Virginia’s public universities to ensure their investments, including those related to endowments and foundations, are free from social or political interests.
In a July 9 letter obtained by Cardinal News, state Education Secretary Amy Guidella and Treasurer Steven Cummings said the state wants to ensure higher education institutions’ “commitment to investments in a manner that prioritizes risk-adjusted returns on investment, regardless of social, political or ideological interests.”
The request stemmed from a conversation between Gov. Glenn Youngkin and the State Presidents’ Council in March, according to the letter, which also cited “recent calls for the university to divest from Israel-related assets.”
The letter asks institutions to report by Aug. 15 whether their schools, their foundations, their endowments or external investment managers have the authority or flexibility to consider non-financial investment factors.
Virginia universities have separate nonprofit foundations that raise money for their schools by investing private donations and undertaking various ventures: Virginia Tech’s foundation, for example, owns the Hotel Roanoke and conference center, and Radford University’s foundation recently opened a hotel near campus.
“The Governor has urged public universities to scrutinize the investment practices of their endowments and foundations, to increase transparency and apply widely accepted investment principles currently used by other federal agencies,” spokesman Christian Martinez said in an email Thursday.
“The Governor remains committed to ensuring that taxpayer-supported institutions are independent of politics and invested in protecting the public institution’s financial interests and its recognition as the nation’s premier institution.”
Martinez did not respond to a question about whether he had specific concerns about the state universities’ investment activities.
Asked to point to state law governing the governance of private university foundations, Martinez responded, “The Governor believes that investment decisions affecting taxpayer-supported institutions of higher education must be objective and independent of political agendas, including those made by the institutions’ affiliated foundations.”
The letter to the university cited the state retirement system’s investment policy as a model for universities to follow, noting that Virginia law requires the retirement system to fulfill its fiduciary responsibilities by determining financial risk without subjecting investments to a “social screen” that considers political, environmental and climate factors.
Gene Chenault, a spokeswoman for the Virginia State Retirement System, said the independent agency only oversees investments related to the VRS trust fund. While the July 9 letter was not initiated by VRS, Chenault said in a statement that the agency reviewed the letter “for factual accuracy regarding VRS investments.”
The letter asks universities to explain how their investment policies differ from their retirement plans and how they vote.
Asked Wednesday whether a similar request had been made before, a Virginia Tech spokesman was unable to provide any information, and several community colleges also declined to comment on the letter.
“This is another example of the administration meddling in higher education politics where they shouldn’t,” Sen. Mamie Locke, D-Hampton, chairwoman of the Senate Higher Education Subcommittee, said Thursday.
She said she didn’t know about the letter until asked about it by Cardinal News.
Locke, a retired political science professor at Hampton University, said endowments typically align with a university’s teaching and research goals but are often bound by strict specifications from donors about how the money should be invested and spent.
She said she doesn’t know how the state retirement system’s investment policies apply to education funds and foundations: “They’re all established with different purposes. You can’t make them the same.”
She later added: “You can’t fit a square peg into a round hole.”
In the wake of Hamas terror attacks in Israel that have sparked months of violence in the Gaza Strip, pro-Palestinian protests on college campuses across the country are calling for universities to divest from Israel. That was one of the demands made by protesters at a late April encampment at Virginia Tech that ended with 82 arrests after three days.
That same weekend, similar protests at the University of Mary Washington resulted in 12 arrests, and at Virginia Commonwealth University, 13 were arrested. The following weekend, 25 people were arrested at the University of Virginia after protesters refused to remove their tents from the campus.
While protesters have drawn attention to their cause, they have not had much success in pursuing divestment from Virginia’s universities.
[Read more: Pro-Palestinian demonstrators say Israeli drones use Virginia Tech hardware. Public documents don’t support that claim.]
In early April, after a group of protesters disrupted a meeting of the Board of Visitors at Virginia Tech, President Tim Sands said the university supported freedom of expression but “must maintain a neutral position.”
At the University of Virginia, students passed a referendum in February calling on the Board of Visitors to divest from Israel, but Attorney General Jason Miyares denounced the request and called on the board to reject “a misguided attempt by University of Virginia students to undermine the legitimacy of Israel.”
“I don’t think the university should use its investment strategy to become one side of such a complex and hotly contested set of issues,” President Jim Ryan told the Board of Visitors at a meeting shortly after the vote, according to a report in the university’s student newspaper, the Cavalier Daily.
Students at private colleges have had some success persuading their institutions to consider investing: At Brown University in Rhode Island, board members are scheduled to vote on divestment in October. After a week of meetings at Columbia University in New York City, President Minouche Shafik said he would fast-track consideration of a student proposal to the school’s advisory committee on socially responsible investing.
Currently, 38 states have laws banning boycotts of Israel or other measures to discourage boycotts.
Virginia is not among them.
In 2016, the Virginia General Assembly passed a resolution condemning the Boycott, Divestment and Sanctions movement, and its main sponsor was Miyares, who at the time represented a district around Petersburg.
In 2022, then-Delaware State Rep. (now state senator) John Maguire introduced a bill to ban boycotts of Israel through the state’s public procurement rules, but it never made it out of committee.
