Bay Area real estate developer pledges $55M to alleviate medical students' debt at Stanford | News | Palo Alto Online |


Bay Area real estate developer pledges $55M to alleviate medical students' debt at Stanford

School of Medicine plans to match contribution for a total $90M in scholarships

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Stanford University alumnus and Bay Area real estate developer John Arrillaga has pledged $55 million towards the Stanford School of Medicine to help cover tuition costs for qualified students, the university announced Wednesday.

"I hope this gift will attract a diverse group of the best and brightest students from every socioeconomic background to the university and bring a Stanford Medical School education within reach for any student who may not have been able to consider it otherwise," Arrillaga said in a news release. "I believe that focusing aid on students with established need is what is best from an equity and opportunity standpoint."

With the School of Medicine planning to match Arrillaga's contribution through other donations and "increased institutional support," $90 million in scholarships is expected to go towards medical students' debt over the next decade.

To determine qualified students, the university will consider the total cost of attendance, which includes tuition and living costs, and subtract it by the student's "available family contribution."

According to the university, last year's graduating class of medical students came out of school with a median debt of just over $89,000 — significantly lower than the 2019 national median debt of $200,000 reported by the Association of American Medical Colleges. That same year, more than two-thirds of Stanford medical students qualified for financial support.

With Arrillaga's donation, the university is expected to double the available assistance provided to qualified, incoming students. The gift will also help the medical school provide financial aid through a more holistic approach to determining need, according to university leaders.

"Our hope is to address the rising cost of medical school by eliminating the financial pressure for those students who feel it most," said Dr. Lloyd Minor, the Carl and Elizabeth Naumann Dean of the School of Medicine. "Also, because we live in an area with such a high overall cost of living, we appreciate that tuition-free does not necessarily mean debt-free."

By removing the burden of debt, Stanford also hopes that it will encourage medical students to seek "less lucrative specialties" as well as careers in academic research or teaching.

This is not the first donation to Stanford from the billionaire landowner. Arrillaga, who received financial aid as a Stanford student, made one of the largest donations to the university in 2013 with $151 million. His surname has been attached to several buildings on campus, including one of the university's dining halls, the Arrillaga Family Dining Commons.


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15 people like this
Posted by Gratitude
a resident of Another Palo Alto neighborhood
on Feb 27, 2020 at 12:15 am

Dear Mr. Arrillaga,
Thank you for taking this generous step to support educating doctors.

I want to add some information, because my hope is that someday medical school will be covered for anyone who wants to devote their life to medicine. (I say this as an engineer, with all tech-family, not as someone who will ever go to medical school.) The expected family contribution that comes from the FAFSA doesn't take into the account the realities of high-cost-of-living areas, and it doesn't take into account circumstances that change in the time from the year in which they take tax returns. We just went through the college application process and our "EFC" (expected family contribution) was about the same as take-home pay -- there is no way to appeal the FAFSA, they expect students to appeal at each college. But that puts a huge amount of pressure and time pressure on students when they are just trying to figure out where they can get in and afford to go (without having the information about the outcome of a financial aid appeal, which is hard).

Most of these students will already have debt from their undergraduate degrees. I realize it's really important for your generous gift to go to as many students as possible, just please be aware that those formulas that decide EFC are really stacked against middle class Californians. (This is why there is even a special middle-class scholarship for UC's.)

Thank you, I'm sure this gift will allow many more people to go into medicine who might not have considered it.

4 people like this
Posted by Well done, Mr. Arrillaga.
a resident of Another Palo Alto neighborhood
on Feb 27, 2020 at 11:10 am

It is heartening to see someone who has been blessed with wealth share it with less fortunate people in a way that serves society for the long term.

Thank you. This is a mitzvah (Look it up, friends.) that benefits everyone. Thank you.

"It is better to give than to receive."

4 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on Feb 27, 2020 at 1:53 pm

Nice of him, although Stanford grads still cannot afford to buy a house in Palo Alto. Basic physician salary is $200K, not enough to even buy a $1.5 million house. Most physicians in town have both husband and wife working to make ends meet. A donation to raise the salaries of the physicians would be great. We don't have good physicians in Palo Alto even with the Stanford name.

1 person likes this
Posted by Barb Dunsmore
a resident of Old Palo Alto
on Feb 27, 2020 at 2:11 pm

Dear Mr. Arrillaga: What an amazing gesture! Thank you for your generosity. You may not remember me but your children's mom, Fran Cook, was my 5th grade teacher at Crescent Park Elementary. All my eight siblings had her and loved her as our teacher. I also babysat for you at your home on University Ave and then when you moved to the ranch style home on Cowper, I believe it was; little John up until he was 2 or so and his younger sister Laura, a gorgeous red-headed baby girl, when she was first born. Good memories. Beautiful family.

May I tell you about my lifelong dream? I've always said, if I were to ever win the lottery big time, I would buy back our old home at 909 Hamilton Ave., and renovate it back to the magnificent house that it once was. That dream will likely never come true but if you, Mr. Arrillaga, want a project...maybe you could do that! :) Keep Palo Alto beautiful!

I miss Palo Alto.
Barb, San Diego

9 people like this
Posted by Stronger ties to Stanford development
a resident of Crescent Park
on Feb 27, 2020 at 2:25 pm

Sorry to rain on your parade, but 55 Million is a tiny amount to a Billionaire.
But the developer's ties to Stanford are reinforced for his future projects.
Remember Arrillaga's 27 University immense mega-project?
Citizens were so offended,the city turned it down.

3 people like this
Posted by A Good Move...A Better Call
a resident of Embarcadero Oaks/Leland
on Feb 27, 2020 at 4:16 pm

In any event, this gift serves a genuine purpose & I'm glad the resources will not go towards alleviating the student debt incurred by those majoring in the Liberal Arts & taking 6-7 years+ to earn a useless Ph.D.

We need more skilled specialists in the medical fields...not sociologists or Russian literature majors.

1 person likes this
Posted by Mark Weiss
a resident of Downtown North
on Feb 27, 2020 at 9:18 pm

I disagree. All this Cartesian thinking is going to lead to mutually assured destruction. We need a Russian literature major to lead us. Where have you gone, Elif Batuman?

5 people like this
Posted by Giver of 2 Cents
a resident of Downtown North
on Feb 28, 2020 at 2:07 am

Since when did doctors (or Stanford engineers like myself, or most Stanford alums in STEM), have difficulty paying off their student debt? Yes, it's a lot of debt, and it may take years to pay off, but once they graduate, their salaries are far more than enough to make ends meet, even after monthly loan payments. Unless they have rich parents or were lucky enough to land a fellowship, Stanford med/grad school students are smart enough to know that they will be paying off loans for years after graduation. If they intend to settle in the Bay Area, they need to make long-term financial plans that account for student debt. This is simply the reality of life as a college grad.

With that said, perhaps it makes more sense to donate $55M to liberal arts programs. Regardless of how important or useful you believe these programs are, the students graduating from them are the ones who may need the most assistance paying off student debt. In particular, I believe the master's programs -- in any field -- are the most costly, because they are rarely supported by an advisor's or department's grant money; doctoral programs, on the other hand, are usually tuition-free and include a generous annual stipend.

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