We discussed the UW Periodontics Department-specific endowments. Each endowment principal is invested by the University in one huge fund (UW Consolidated Endowment Fund). The operating (spendable) budgets receive distributions of about 3.6% of the previous year’s value of the fund. The remaining growth of the fund (if any) is reinvested in that particular fund by the UW to keep the fund operational and growing in perpetuity. If there are net losses in a particular year, those are absorbed by the general fund by applying to growth from other years.

Actual details from UW: The University of Washington's Consolidated Endowment Fund (CEF)
https://finance.uw.edu/treasury/cef2024 has a total annual spending rate of 4.5%. This includes a 3.6% distribution to programs and a 0.9% administrative fee. The CEF is currently over $5.5B.