Posted by admin on Jan 29, 2009 in
College News If it is college news, I am going to go ahead and hold myself to this one, you are going to hear it here first. That’s just it. Interesting article about college endowments. Thought you guys and gals might enjoy it.
Source Link: http://www.csmonitor.com/2009/0128/p01s02-usec.html
Budgets are cut as a new study reports an average loss of 23 percent in endowment value.
College endowment funds, like other investments, took a huge hit this fall – resulting in billions of dollars less to spend on school budgets that cover everything from staff to building projects to student financial aid.
For colleges that rely on income from their endowments to fund a third or more of their operating expenses, cost-cutting measures, including layoffs and hiring freezes at some schools, are already under way.
Brandeis University in Waltham, Mass., is making a controversial move in response to losses: It announced plans Monday to close its art museum and sell the collection.
If there’s any good news for higher education, it could be that only a small number of colleges rely heavily on endowments to keep themselves running – and that college endowment funds in general performed better in the bear market than did the major indexes.
Still, between July 1 and Nov. 30, 2008, endowments lost nearly 23 percent of their value, according to a survey of 435 colleges and universities for a report released Tuesday by the National Association of College and University Business Officers (NACUBO) in Washington.
“For a small number of colleges, endowments have a very significant impact,” says Sandy Baum, a senior policy analyst at the College Board, a nonprofit association in New York. Among the majority of colleges, which have smaller endowments, “the silver lining to not having a large endowment is [they're] not very dependent on it.”
Despite the losses, most institutions, particularly those with large endowments, are expected to make financial aid a top priority. “There’s a lot of hiring freezes or slowdowns going on, but … student financial aid is one of those things, in bad economic times, where you don’t want to reduce support,” says John Walda, NACUBO’s president and CEO.
Harvard, Princeton, Yale, and Dartmouth, for instance, all draw more than a third of their operating budgets from their multibillion-dollar endowments, but they’ve announced their intent to maintain financial aid – including relatively new policies to give more help to low- and middle-income families.
Less of a tuition increase
Princeton has gone a step further on affordability: On Monday, it announced its lowest undergraduate tuition and fee increase since 1966 – 2.9 percent. Next year’s charges will top $47,000, but the average grant to students on financial aid is nearly $34,000. Also, Princeton is increasing its undergraduate scholarship budget by 13 percent.
“Even though [Princeton is] much less wealthy than before, they’re not going to try to compensate for that through tuition increases,” Ms. Baum says. “We don’t know yet how many other similarly fortunate institutions are going to do that, but it wouldn’t be surprising if they take that approach.”
Many colleges will have trustee meetings in the coming months before determining tuition. “How you proceed on the tuition side and the financial aid side is going to have a very big impact on families’ willingness to enroll…. But because the economic markets are so unstable, it’s very hard for institutions to make plans with any certainty,” says Terry Hartle, a senior vice president at the American Council on Education, a research and advocacy group in Washington.
Like many of its peers, Dartmouth College in Hanover, N.H., is facing an unprecedented budget situation in the wake of an 18 percent decline in its endowment from July to December. That brought the value down $700 million, to about $3 billion. The school relies on endowment spending for about 35 percent of its undergraduate college’s operations.
Dartmouth officials recently announced that “some staff layoffs are inevitable” to help trim more than $60 million from the annual $700 million budget for its undergraduate college and professional schools. Tenured and tenure-track faculty and student financial aid are not subject to cuts. Just more than 70 out of 600 eligible nonfaculty employees have taken retirement incentives.
“It’s a little bit somber,” says executive vice president Adam Keller of the mood at Dartmouth. But people aren’t surprised that layoffs are coming, and the community is working together to minimize the need for them, he adds. “We have more than 300 suggestions from employees about … things we could do to save money, and we’re looking at those very seriously.”
The University of Rhode Island Foundation has seen an 18 percent decline, too, from its June 30 value of about $88 million. But the impact is small relative to schools with large endowments. It marked the median point of the NACUBO survey, with half the endowments higher and half lower. Typically, the endowment contributes about $4 million to the $308 million operating budget for the public university.
“There’s a possibility that we won’t be able to award any of that $4 million in the next fiscal year,” says foundation president Glen Kerkian. It won’t be clear until the end of the foundation’s fiscal year in March how much it can award, and whether the university will be able to bridge the gap with other revenue. “Almost 55 percent [of endowment spending] is for scholarships…. This is what makes this like a double whammy…. Scholarships are as needed, and possibly as unavailable, as they’ve ever been,” Mr. Kerkian says.
Spending part of an endowment
As endowments have enjoyed strong returns over the past several years, Sen. Charles Grassley (R) of Iowa has raised the idea of forcing colleges to spend a certain amount of their endowments – perhaps 5 percent – to help reduce costs for students. Now the pressure may be off.
“The whole idea of endowments is … [to] have security for the long run and continue your operations in bad times,” Baum says. So it’s “totally appropriate” for schools with large endowments to spend at a lower rate in periods of rapid enrollment growth and to raise the rate in a downturn.
Over the past 10 years, the NACUBO survey has seen average annual spending rates ranging from 4.5 to 5.1 percent.
Tags: college, endowments, enrollment, students, tuition
Posted by admin on Jan 27, 2009 in
Announcements It’s Official! Around Campus Bookstore is 24 hours old and officially launched. We want to thank all the students and beta testers who help us work out all the visible bugs in the system.
So, don’t wait any longer. Log on, sign up, and if you want, make money. This is going to be the hottest thing in the collegiate space this year hands down. We promise to help you put your college bookstore out of business.
Check out our press release: Press Release: Around Campus Bookstore Newest Addition to “Buy Textbooks Online” Space
Tags: buy cheap textbooks, buy college textbooks, buy text books, buy textbooks, cheap college textbooks
Posted by admin on Jan 24, 2009 in
College News Yo, kids, Happy New Year! I know……it’s late but it’s better than never……trust me! I found a great article that I think you guys should definitely take a look at. Going to and staying in college can be very, very challening in the environment we are in in this New Year. This article touches squarely on that issue.
We chose to post this article because A, it really touches on the core of education and B, we have been talking about saving money on books and college in general well before America wanted to admit there was a crisis. So sit back, read, enjoy and check us out at Around Campus Bookstore. Thanks!
http://www.csmonitor.com/2009/0121/p12s01-usgn.html
Many students need extra aid to pay spring-semester tuition.
By Stacy Teicher Khadaroo | Staff writer of The Christian Science Monitor
from the January 21, 2009 edition
It’s crunch time for college students. No, this isn’t about exams. It’s about tuition bills.
Facing job losses, dwindling college-investment accounts, and a tight credit market, students and parents have been streaming into financial-aid offices, asking for adjustments to their aid packages. Colleges are trying to help, but as the second semester starts up, some students have had no choice but to drop out or scale back the number of classes they’re taking.
To expand financial aid, many colleges are cutting back on hiring, and construction projects are going on hold. Some institutions are getting creative on the fundraising front – think special appeals to alumni. Another tactic: Some colleges are offering leniency to students with unpaid balances.
School officials thought the trouble would hit this past fall. Instead, overall enrollments were “perfectly normal,” says Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers (AACRAO) in Washington. But now, he says, “people are apparently running out of steam.”
Midyear departures are particularly disruptive. Schools create budgets based on enrollments for the year. And for students, “it’s very hard, having done one semester, to then [temporarily stop or transfer] and not end up losing a lot of credits and a lot of time,” Mr. Nassirian says.
Nearly a quarter of private colleges and universities and 13 percent of publics expect second-semester retention to be worse than last year’s, according to a survey of 214 chief financial officers by The Chronicle of Higher Education and Moody’s Investors Service.
“There’s clearly a heightened awareness [of the financial situation facing students] and a lot more proactivity by colleges and universities,” says Bob Giannino-Racine, executive director of ACCESS, a nonprofit financial-aid counseling service in Boston.
Syracuse University in New York noticed a 30 percent rise in requests for additional aid this fall. It launched a campaign in early December to try to raise $2 million for emergency grants by Jan. 31. It’s already helped more than 350 who otherwise wouldn’t have been able to return.
One is sophomore Nykeba Corinaldi. “I’m taking it literally semester to semester,” she says. Her mother is unemployed, her father doesn’t contribute, and she couldn’t secure a loan on her own after one fell through this summer. The financial-aid office gave her extra grants and loans this fall, and now, thanks in part to the Syracuse Responds initiative, she’s back to finish out the year. “It was a huge boulder off my shoulders,” she says.
At Spelman, a historically black women’s college in Atlanta, about 500 students, a quarter of the school, had not fully paid their bills by late last semester. A fundraising drive has matched students with donors willing to cover their balances. Seniors have priority, and it appears they’ll all be able to graduate.
But that’s still not enough. “Unfortunately, we have had significant numbers of students who have stopped and said, ‘I’m going to try to come back in the fall,’ ” says Arlene Cash, Spelman’s vice president for enrollment management. “We’re working hard to find ways to support them.”
A number of schools have also announced tuition and financial-aid plans early in the cycle, hoping prospective students won’t give up altogether on the idea of college. Benedictine University in Lisle, Ill., and Merrimack College in North Andover, Mass., for instance, are freezing tuition for the coming year.
Ohio State leaders pledged that if tuition goes up, financial aid will go up proportionately. “We’re trying to get the word out to the community broadly that you can’t afford not to go to college and that there’s all kinds of help available,” says Martha Garland, vice provost for enrollment services and dean of undergraduate education.
Manchester College in Indiana wants to ease concerns about affordability by offering a “Triple Guarantee”: Academically strong low-income students from Indiana will receive grants to cover any gaps after federal and state aid is received; students will graduate in four years, or they can get a fifth year of classes for free; and if they don’t land a job within six months of graduating, they, too, can have a free year of classes.
The four-year graduation guarantee is “addressing a cost of college that lots of families don’t consider – that fifth or sixth year” that is fairly common at some institutions, says Manchester executive vice president Dave McFadden.
Despite these efforts, it’s understandable if families aren’t so upbeat. Many public universities are anticipating tuition spikes in the wake of state budget cuts. Nearly half of publics and 7 percent of privates plan to raise tuition for the coming year at a rate higher than the past three-year average, the Chronicle/Moody’s survey found. And in a December survey by the National Association of Independent Colleges and Universities, 8 percent said they had frozen or cut financial-aid budgets, or plan to.
College affordability “is a true middle-class crisis now,” Mr. Giannino-Racine says. Waves of students who used to take the private four-year route are shifting to public and community colleges. In turn, students with less competitive backgrounds could be pushed out of college altogether, he and others say.
Higher-education officials are hopeful that as part of the economic stimulus package, Congress will increase Pell Grants for low-income students and infuse cash into states so that they can avoid deep cuts to public universities. House leaders have outlined a $15.6 billion increase in Pell Grants as part of their proposal to help higher education.
Tags: college dropouts, college seniors, financial aid, graduation, HBCU, Spelman, Syracuse