The Carlson School of Management will announce today that it received a multimillion dollar donation, which officials said has spurred another large contribution.

University graduate Herbert Hanson Jr., class of 1949, pledged $10 million to the undergraduate building expansion project.

He said he hopes the money will spur potential donors and the state to provide funding.

The donation prompted at least one other individual to contribute $1.4 million, said Chris Mayr, chief development officer at the Carlson School.

Mayr said 1937 University graduate John Spooner pledged the money.

The business school will announce the $10 million donation at the school’s Board of Overseers meeting. University President Bob Bruininks and Carlson School Dean Larry Benveniste will be on hand for the announcement.

The undergraduate expansion building will be adjacent to the current Carlson School building and will cost an estimated $25 million to $30 million to construct. But Benveniste said the actual costs will be higher considering services, faculty and staff.

The building will allow the business school to have 50 percent more undergraduates.

Hanson said the fact that Carlson School accepts only 15 percent of applicants is “atrocious.”

“We don’t have the capacity to handle the people from the state who have a right to a quality education.

“I’ve never met such bright, intelligent and personable people as I have with my association here for the last five years,” he said.

Benveniste is asking the State Legislature for $1.7 million for the building design.

The target formula for funding the expansion is one-third by private donation and two-thirds by state bonding measures, he said.

Benveniste said the new donations make him “very optimistic” that the bonding will pass.

He said the donations illustrate the private-public partnership that defines the Carlson School.

“The private sector has stepped up, now the public sector should step up,” Benveniste said.

The existing Carlson School building was funded in the same way, he said. Curtis Carlson donated $10 million in the early 1990s, which attracted other donors and $25 million from the state, he said.

Hanson said he went to the University after serving in the U.S. Army airborne division.

“After being in the service for three years, you have all this pent-up desire for a social life.

“I didn’t ring any bells academically my first year,” Hanson said.

But after doing poorly his first year, he said he knew something had to change.

“It was either get with it or get out. I knew something had to give, and it wasn’t going to be my future,” Hanson said.

He credits his mentor, late University professor Arthur Upgren, as his inspiration.

“He loved to talk with freshmen who were 23 or 24 because he knew they had been in the service and he respected that,” Hanson said.

When graduation came, Upgren told him he had something for him, Hanson said.

“I said, oh my God, he’s going to give me a statue that says ‘worst student ever’ or something like that,” Hanson said.

His mentor actually gave him letters of recommendation, which helped him land his first job at Wells Fargo in San Francisco.

From there he worked as a broker for Dean Witter & Company for seven years.

“I didn’t enjoy it because there was such a large conflict of interest between what was good for me, in terms of commission, and what was good for the client,” Hanson said.

“Starting my own business was the culmination of everything I hoped to have,” he said.

He went on to start the San Francisco-based Hanson Investment Management, which managed more than $2 billion in assets at the time of its sale in 1993.

In 1999, Hanson honored his mentor by donating $1.25 million to establish the Arthur R. Upgren Chair in Investment Management at the Carlson School.

Now, with Hanson’s new donation, Benveniste said Carlson School’s program can continue to be a state leader.

“There’s no better investment than the investment in people. And our school represents the best,” he said.