NEW YORK (MainStreet) — College tuition hikes are slowing and part of the reason could be due to record donations to U.S. colleges and universities. According to the Council for Aid to Education, 2013 donations rose 9% to $33.8 billion, topping the previous record of $31.6 billion set during the 2008 fiscal year. Fitch Ratings says the contributions will help institutions achieve strategic goals, including controlling tuition increases and financing campus improvements.

Alumni donations rose $1.3 billion and were the fastest-growing source of gifts, up nearly 17% over the previous year. Gifts for capital purposes and for current operations both increased, with the average gift per contributing alumnus increasing 18.1%. Foundation contributions gained $850 million while giving from other organizations were up by $400 million and non-alumni individuals increased donations by $375 million. Corporations gave $150 million less.

"The 2013 increase came on the heels of a lackluster year," says Ann E. Kaplan, CAE survey director. "The level of giving in 2013 was indeed impressive and will be challenging to exceed."

Fitch says last year's surging stock market, combined with the aging of the donor population and a desire to assist students cope with rising tuition costs are likely driving benefactor benevolence.

"These additional funds can help institutions to balance achievement of enrollment goals and targeted net tuition growth," Joanne Ferrigan writes in a Fitch analysis. "Many of the largest gifts mentioned in the Council for Aid to Education report were granted to universities with strong national and international recognition. In our view these institutions will continue to experience strong student demand at any conceivable cost level. Stanford University, Harvard University and the University of Southern California won the top three spots on the list of gifts."

The College Board, in its annual survey of colleges, reports average in-state published tuition and fees at public four year institutions increased from $8,646 in 2012-13 to $8,893 in 2013 14. The 2.9% increase followed increases of 4.5% in 2012-13 and 8.5% in 2011-12 (before adjusting for inflation) and was the smallest percentage increase in over 30 years.

--Written by Hal M. Bundrick for MainStreet