Florida International University has announced that trustee Herbert Wertheim has withdrawn a $20 million gift to the new FIU College of Medicine and has resigned from the university's board.
Wertheim informed the university in November that he was not prepared to meet the terms of the agreement signed a year ago and asked that his name be removed from the college of medicine. According to university president Modesto A. Maidique, the board had approved the naming of the college based on a $20 million gift that, with matching funds, would have become $40 million. "If payment had been delayed, the matching funds portion of the gift would have been put at risk and its value significantly reduced," said Maidique. "The agreement stipulated that the $20 million gift would be made in full within thirty days of the naming of the college, which occurred on September 29, 2006."
According to the South Florida Business Journal, Wertheim had been one of the medical college's key supporters as it won state approval this year, and his gift and its state match were to be a large part of the funding. However, a week after the trustees named the college in Wertheim's honor, his accountants warned him that donating $20 million in a lump sum would cost him $4 million to $6 million in lost tax deductibility. Wertheim proposed breaking the donation into four payments of $5 million, with the last one to be made in January 2009. "Given that such a payment schedule would allow the university to receive the funds well ahead of its actual expenditures, and given our past commitment to and relationship with the university, I felt the request was very reasonable," he said. FIU's administration countered with a plan for Wertheim to pay $5 million a year for eight years, which he rejected.
Maidique said he remains appreciative of Wertheim's involvement with the university, where two other buildings bear his name. "We're disappointed, but these things sometimes happen in philanthropy. The FIU College of Medicine remains on track to accept applications in 2008 and admit our first class in 2009, as planned."