Next year’s projected tuition represents the lowest cost bump in more than a decade, but at GW – where tuition is the top-earner – this has left administrators scrambling to streamline next year’s budget and find more alternative funding.
The Board of Trustees approved a plan Friday to increase tuition by 3 percent, a far cry from the double-digit spikes of several years ago. It also ranks below the 6.3 percent average increase for private institutions last year, according to a College Board news release.
University President Steven Knapp’s dictum to slow tuition growth puts pressure on the school to adapt a budget less dependent on student revenue, said Executive Vice President and Treasurer Lou Katz. He said they hope fundraising will replace a good portion of this money in the next five years.
It is a significant goal because tuition and required fees generated more than $500 million last year for University operations – 70 percent of all annual revenue – according to the capital budget. About a quarter of this money goes to financial aid, which is where Katz said he hopes to see the most growth from outside donations.
More than half of the University’s operating budget is funded by tuition – a statistic that puts GW atop many peer institutions. It also makes the school economically fragile if enrollment suffers. Katz said the administration are ready to leave this behind.
“The financial position of the institution has increased from year to year, and we believe we can manage the institution with lower tuition increases,” he said.
Katz said they have to look for ways to make the budget as efficient as possible without affecting students. The best way to do this, he said, is continuing to move offices from Rice Hall to the Virginia campus in Loudoun County.
“We’re not planning on pulling money from the academic side of the institution,” he said. “We are going to do some reallocations.”
The University is currently constructing a $75 million residence hall on F Street and preparing to build another multi-million project on the Mount Vernon Campus. These future projects are weighty, but housing construction is less of a concern because it is funded by debt and paid for by student housing costs, Katz said.
After the Board meeting, a news release emphasized $118 million in financial aid grants for next year. This number is unchanged from 2007, and University spokesperson Tracy Schario said this is because a large graduating class will allow for more grants per student.
Despite this explanation, this is the first time this century that institutional grants did not increase. Grants have grown an average of $10 million annually in recent years, and the figure is currently more than double what it was in 2000. Katz said if the incoming freshman class is larger than expected, the University would have to present a higher number to the Board.
Senior Vice President Robert Chernak said the institutional aid figure is calculated using a wide variety of variables, including the number of students receiving aid, the amount of aid they need, and the current economic state of families with children in college.
Next year’s budget, which may reflect administrative efforts to be more efficient, will be presented to the Board at their spring meeting in May.