She added that the endowment payout percentage will continue to increase in coming years to reach the target range of 4.5 to 5 percent.
"We're very much trying to shift the onus [of generating income] a little less on students, and a little more on endowment," Huidekoper said.
Over the past 10 years, steady increas- In 1987, tuition represented 35 percent ofHarvard's income, but today only 31 percent ofrevenue comes from students, to a large extentbecause payout from Harvard's endowment has jumpedfrom 16 percent to 22 percent of income. Undergraduate tuition increased by 4.8 percentin fiscal 1997--the lowest increase since1969--and significantly less than the 8.4 percentaverage annual tuition rise over the past 20years. Moody's Investors Service, whose reports onHarvard's bonds, continues to rank Harvard with a"Aaa" credit rating, the highest possible onMoody's lead analyst for Harvard's credit. "All in all, Harvard is comfortably within itsrating category of triple [A]," said NaomiRichman, Moody's lead analyst for Harvard's credit Analysts at Moody's emphasized the strength ofHarvard's endowment as a critical factor inmaintaining its growth and financial stability. "The driving force of Harvard is the stellarendowment, both from investment return andtremendous fundraising," said Thomas E. Calibeo,an analyst at Moody's who also studies Harvard'scredit. Other institutions within the prestigious "Aaa"club include Princeton, Columbia, Stanford,Dartmouth, Yale, MIT, Notre Dame and the U.S.government. But while the government was placed ona "credit watch" during the shutdown of 1995,Harvard has held onto its prestigious "Aaa"ranking without interruption since February 1974.