Short news articles based on research surveys and peers’ business experiences that can benefit institutions
- Research: College Price Increases Keep Pace With Inflation
- Stats: Losses in Retirement Savings, Confidence
- Spotlight—Small Institutions: A Future-Focused Budget Network System
- Campus Operations: Notification Systems Soar; IT Issues Remain
The total amount of retirement savings Americans have lost (as of October 2008) because of the sharp decline in the stock market over the previous 15 months.
The estimated median amount of time it will take employees who have been at their jobs for 20 to 29 years to recoup the losses they incurred because of the market sell-off.
The percentage of employees in 2008 who said they were “very confident” about having enough money to afford a comfortable retirement, down from 27 percent in 2007.
Sources: Employee Benefit Research Institute News, April 9, 2008; U.S. News and World Report, Dec. 11, 2008.
The College Board has released its annual Trends in College Pricing survey report. Results show that this year’s listed prices of tuition and fees at the nation’s postsecondary institutions generally kept pace with rising inflation as measured by the consumer price index (CPI). In addition, a companion report, Trends in Student Aid, shows that total grant, work-study, and education tax benefit aid to postsecondary students in the 2007–08 academic year rose to $143.4 billion, a record high.
Tuition and Fees Track the CPI
For the 2008–09 academic year, listed prices for average tuition and fees for full-time undergraduates attending four-year private nonprofit colleges and universities rose 5.9 percent, to $25,143, while listed in-state tuition and fee prices for full-time undergraduates at four-year public institutions increased 6.4 percent, to $6,585. At community colleges, the average listed in-district tuition and fee price for full-time attendance reached $2,404, a gain of 4.7 percent. In each case, the average price increase was only slightly higher than the 5.6 percent jump in the CPI as of July 2008.
Adding room and board to tuition and fees, the cost-of-attendance charges for full-time undergraduates attending four-year public colleges and universities rose 5.7 percent, to $14,333; those costs increased to 5.6 percent, or $34,132, for full-time undergraduates at four-year private nonprofit institutions.
The College Board collected the tuition, fee, and total cost-of-attendance figures in October 2007. Since then, at least 11 states have announced midyear tuition and fee hikes for in-state undergraduates, according to the Center on Budget and Policy Priorities. The College Board data do not reflect these midyear tuition increases.
Student Aid Keeps Up
Financial aid for full-time students appears to be rising at nearly the same rate as the increase in prices, suggesting that higher education institutions and federal and state governments are increasing their efforts to mitigate the adverse effects of rising tuition on the most needy undergraduates. The Trends in Student Aid report reveals that total aid to all college students (undergraduates and graduates/professionals combined) grew roughly 6 percent between 2006–07 and 2007–08. Institutionally funded grants increased almost 9 percent, to $29.1 billion. Collectively, colleges and universities provide 42 percent of the total grant aid awarded to postsecondary students; federal programs, by comparison, account for 31 percent of total grant aid.
Rising institutional aid, combined with federal college tuition tax credits and increases in state and federal grant appropriations, suggest that a large number of students are actually paying less for college than the published tuition and fee charges indicate.
The College Board estimates that in 2008–09, full-time students at four-year private nonprofit colleges and universities are receiving an average of $10,200 in grant aid from all sources and federal tax benefits. This aid reduces the tuition and fee price that full-time undergraduates actually pay—the “net price”—to about $14,900. Full-time students attending four-year public colleges and universities are receiving an estimated average of $3,700 in grant aid from all sources and federal tax benefits, which reduces the average net tuition and fees price to about $2,900.
The one source of aid to college students that appears to be declining is private (nongovernmental) student loans. Between 2006–07 and 2007–08, the amount of private loans received by postsecondary students fell about 1 percent, from $19.223 billion to $19.06 billion. This decline may reflect the freezing of the credit markets and the increasing use of federal student loans.
RESOURCE LINK For more information, see www.collegeboard.com/html/costs/aid/.
Using a computer and the Microsoft Excel program with its file-sharing capability, the finance office of Pacific University, Forest Grove, Oregon, replaced its inefficient budget building system with a new streamlined process. Perhaps more importantly, we recently moved beyond our one-year budget process to a three-year budget forecasting system. This budget network system (BNS) provides a timely, future-focused forecast that is required for our growing university.
The results provide data for key decision making and inform our board of trustees of the university’s future financial path and the sustainability of our growth strategies.
I accepted the challenge of creating an online system about six years ago. After exploring several options, using Excel seemed the best approach. It took about eight months to design the BNS and set up Excel files and system security. I then linked detailed budget-area spreadsheet templates to summary reports. An advisory group provided valuable feedback and helped test the system. The support throughout the process of the President’s Council, the board, and many others on campus helped facilitate the implementation.
System security was one big challenge that we needed to overcome. We wanted staff in each budget area to have access only to their own files. Fortunately, our technology group was able to assist by thoroughly testing the Excel file-sharing security, and setting it up so that we could centrally maintain it.
The system eliminated a lot of manual work by budget officers and managers. The BNS automatically provides a number of summary reports for executive management and the board. Since straightforward Excel spreadsheets are the basis of the program, minimal training is needed. We’ve made the BNS more robust by adding more reports plus some detailed payroll information.
Filling in the Blanks
We launched the system in FY02–03, when budget area officers and managers began entering their budget information into templates accessed from their desktop computers. All templates are linked to the Financial Operations Summary report maintained by the budget office. Advantages of the centralized online data include the following:
- Budget officers can input and access budget information at their desktops.
- Vice presidents can retrieve budget information for departments under their areas of control.
- We can easily enter departmental budget amounts into the general ledger from the budget templates after the board has approved the budget.
A major enhancement to the BNS enabled us to include two additional years so that we can have a three-year budget view. The current year is quite detailed, while the second and third years allow us to model our revenue and expense projections based on certain assumptions for enrollment, rates, expenditures, and so forth. To view additional budget information for Pacific University, go to www.pacificu.edu/offices/finance/budget/.
Since the three-year budget includes projected enrollments, revenues, and expenditures, the new budget process produces significant benefits, such as:
- Facilitating balancing the next year’s budget, plus modeling two additional years.
- Providing advance figures for projected growth, giving budget officers the information they need to effectively plan and prepare for the future.
- Providing to the board and financial institutions the information they need to support and approve growth strategies and funding.
At the March 2008 board meeting, one trustee said, “The administration’s financial planning has become more systematic and proactive. Long-range financial projections are in place. The administration has demonstrated that it can manage the reality and respond to fluctuations.”
SUBMITTED BY William B. Ray, assistant vice president, finance and administration, Pacific University, Forest Grove, Oregon.
While certain information technology (IT) issues still plague U.S. colleges and universities, nearly all institutions have established on-campus emergency notification systems, according to a new survey recently published by the Campus Computing Project. The project’s 2008 National Survey of Information Technology in U.S. Higher Education reports that the share of campuses that have initiated one or more efforts to notify students, faculty, and staff of campus emergency situations has climbed from 75 percent in 2007 to 95 percent in 2008.
Survey responses, however, indicate substantial differences by institution type. Only about 87 percent of community colleges had emergency notification systems in place in 2008, compared with 95 percent of private four-year colleges, 97 percent of four-year public colleges, and 98 percent of four-year private universities that have such systems. All of the four-year public universities that participated in the survey said they had established emergency notification systems.
New Techniques Add Options
Relatively new communication media accounted for much of the growth in notification system use. The types of notification options that experienced increased use in 2008 compared to 2007 included the following:
- Text messaging, 76 percent compared to 43 percent.
- E-mail notification, 87 percent compared to 66 percent.
- Voicemail communication to off-campus phones, 41 percent compared to 18 percent.
- Sirens and public address announcements, 35 percent compared to 22 percent.
Responses were not mutually exclusive, as some campuses may use more than one type of method to notify students, faculty, and staff of on-campus emergencies.
Don’t Forget IT
The Campus Computing Survey also measures the number of IT security issues faced by campuses. The percentage of survey respondents that reported one or more “virus infestation” attacks on campus computer networks has declined sharply, from about 35 percent in 2005 to 11 percent in 2008. However, reports of thefts of computers with sensitive information climbed from 16 percent to 22 percent.
Campuses’ ongoing IT security issues come just as the budgets for their computer departments are being cut. About two fifths of public universities reported reductions in their IT central budgets in 2008, up from only 16 percent one year earlier. The share of four-year public colleges that reported trimming their spending on IT services also rose sharply—from 17 percent in 2007 to 44 percent in 2008. Independent colleges and universities also reported reductions in their expenditures on IT services.
RESOURCE LINK For more information about the Campus Computing Project survey, go to www.campuscomputing.net/.