The Hatchet’s “University prepares for tuition slowdown,” (April 19, p. 4) stated that the University is anticipating a plateau in tuition revenue. But in fact, the University is forecasting that tuition revenue will grow year over year by 6 percent.
While there are caps on the number of students permitted on the Foggy Bottom and Mount Vernon campuses, the University is able to grow tuition revenues elsewhere, including off-campus, online and in study abroad programs. The University also has sources of revenue other than tuition, including investments, research grants, rental income and fundraising.
Market conditions have created the opportunity for the University to add to its liquidity at historically low interest rates. This was not done to finance immediate needs. Rather, the University’s already strong financial position is further enhanced by this strategic borrowing, which gives the University flexibility and options in paying for future capital needs on its own terms. Indeed, one reason the University has been able to weather the financial crisis much better than many other institutions is that we have had adequate sums of cash on hand. This prudent management of our resources has allowed us to avoid the kind of draconian choices faced by many of our peers.
It is critical that the University community understands that this strategy is based on a position of strength and that the University is poised for continued growth in the future.
Lou Katz is the executive vice president and University treasurer.