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The quest to build the endowment will be one of Cabrera's chief challenges.
"We cannot continue on that course," he said in a statement, "or our endowment will be depleted by 2018".
The endowment will be used to support faculty research in global infectious diseases, student summer internships, and doctoral student research.
At Harvard University's current rate of growth, its endowment will be larger than the Bill & Melinda Gates Foundation, the world's largest foundation, in three years.
Under the new structure, which will take effect on July 1, the Washington National Opera will maintain a separate board; its endowment will be accounted for separately; and donations designated for the opera will be spent on the opera.
All income from the endowment will be used to create graduate fellowships for MIT students supervised by RLE faculty with the rank of Assistant or Associate Professor.
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"Endowments will be shocked at the valuations of their [private equity] portfolios," says Stewart Massey, an endowment consultant at Massey Quick.
Part of the endowment from Lewis' gift will be used to support promising early career scientists as Lewis-Sigler Fellows.
The endowment created by this gift will be used to support faculty research, specific national and international program activities, student scholarships, and other initiatives.
To give you some sense of the magnitude of the challenge to restore a sustainable spending rate for the endowment, we are constructing the FY11 budget with the assumption that endowment returns will be flat this year, based on ongoing uncertainty about the extent and timing of the recovery in the markets, and that they will return in FY12 to the long-term projections of ~10percentt.
An endowment fund will be started in his name.
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