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Lindley Estes is a business writer for The Free Lance-Star and This blog is on Fredericksburg-area business. Send an e-mail to Lindley Estes.

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For school, largest gift began with Buffett

Barbara Dodd Anderson recently gave a prep school in Bucks County, Pa., $128.5 million, according to an article in The New York Times.

While the George School certainly owes a debt of gratitude to the 75-year-old California woman, it also has Warren Buffett to thank for the gift, which will nearly triple the school’s current endowment.

Anderson is the daughter of David L. Dodd, a former business professor at Columbia University in New York City. Buffett, the CEO of Berkshire Hathaway, attended business school at Columbia after getting rejected by Harvard University.

Dodd was impressed by his pupil and decided to invest in Buffett’s original investment partnership. Some of the money was invested for his daughter.

Over the next four decades or so, as Berkshire’s stock rose at a better than 21 percent annual clip, people who kept their money with Buffett became extremely rich. Anderson is just one example. Much of the fortune that she gave to the private George School, which she attended in the 1940s, came from that original investment.

School officials were quoted in the Times article as saying Anderson’s donation was the largest known gift to an independent school.

Buffett is quoted in the article as saying that many other early Berkshire investors have recently given vast sums of money to various charities and organizations. Charles Munger, Berkshire’s vice chairman, has given many millions of dollars to private schools in California.

Anderson was quoted as saying she was inspired by Buffett’s pledge last year to give away the bulk of his fortune to the Bill and Melinda Gates Foundation.

When Fortune magazine broke the news in June 2006 of Buffett’s donation, the magazine cited that Berkshire’s share price made the gift worth about $37 billion.

Since then, Berkshire’s stock is up nearly 30 percent. That means Buffett’s total gift is now up to nearly $50 billion. Buffett is giving away a set number of shares every year. As long as the price of Berkshire keeps rising, his donation could eventually vastly surpass the originally reported figure.