Despite the downturn in the national economy and Tufts' comparatively small endowment, the Arts, Sciences, and Engineering budget for next year will not suffer any major cuts, and it will include a significant increase in financial aid.
| Where the money comes from: Tuition and fees: $165 million Endowment: $7 million Gifts for current use: $5 million Other sources: $400,000 Sales & Serv Educ Activ: $3 million Sponsored programs: $31 million Indirect cost recovery: $3.6 million Sales & Serv Auxil Enter: $37 million Total: $252 million | Where the money goes: Instruction: $68 million Academic support: $20 million Student services: $ 9 million Service of Educational Activity: $3 million Unsponsored student aid: $41 million Sponsored student aid: $8 million Sponsored research: $18 million Other sponsored activity: $6 million Institutional services: $22 million Operation and Maintenance of plant: $17 million Auxiliary Enterprises: $34 million Operating contingency: $2 million Debt retirement, plant funds, etc.: $6 million Total: $252 million |
Financial aid spending will go up an estimated 12.8 percent for the fiscal year that begins July 1, 2003, the largest increase of any category in the budget.
Tufts was able to increase its financial aid and weather the economic storm partially because it is now bringing in more money through fundraising and research grants, according to Executive Administrative Dean Wayne Bouchard.
In particular, Tufts Fund has placed more of an emphasis on annual giving. According to the fund's director, Jeffrey Winey, the fund now stands at about $400,000 ahead of where it was last year, and it has a goal of raising $5 million more by the end of this fiscal year. The money raised is contributed directly to Tufts' operating budget -- not to the endowment.
"We need to continue raising more expendable dollars that the deans can spend to support financial aid and academic programs," Winey said. "The emphasis has been there, but it's continued to strengthen with the new president and new provost coming on board."
Donations earmarked for financial aid have significantly helped the University this year. Tufts Fund has focused some effort specifically on financial aid in part because of the "Pritzker Challenge" -- a promise by alumni Dan and Karen Pritzker to match up to $5 million in donations to financial aid for scholarships for minority students over the next five years.
Tufts Fund's ability to raise money for financial aid is key, given that the University has a lower endowment than any of the schools that administrators consider benchmarks. Brown University, which Bouchard considers one of Tufts' closest competitors, is switching to need-blind admissions next year, and Tufts needed to increase its financial aid to compete with Brown and other schools. Also, the economic downturn has created greater demand for financial aid among applicants to Tufts.
Increases cannot come from fundraising alone, and Tufts faces many challenges in creating a budget that reflects University priorities.
Because the Arts, Sciences, and Engineering budget is tuition-driven -- $165 million of the $252 million comes from tuition and fees -- Tufts must balance the tasks of meeting rising operating costs while trying to keep tuition affordable to students. The cost of financial aid, technology, and library acquisitions can often grow more than ten percent, while tuition increases are usually under five percent, Bouchard said.
Instruction is the biggest single expense each year, at $68 million. A variety of costs to operate and maintain the University come to about $74 million.
When the budgeting process begins over the summer, the University must attempt to predict costs for a year in the future, such as utilities and compensation of employees. The School of Arts, Sciences, and Engineering has to complete its budget by February, earlier than Tufts' other schools, so that tuition and financial aid information can be given to students admitted in April.
Rising oil and utility prices may have caused woes for off-campus students this winter, but Tufts had actually anticipated the rises and accounted for them in the budget. "The bottom line would be better if oil prices weren't as high as they are," Bouchard said. "But our planning process allowed us to cover the projected costs."
The University is losing some money this year and next because of state cuts to funding higher education. Gilbert Grants, which are state funds to help students from Massachusetts pay for college, were significantly reduced by the state this year, causing Tufts to lose an estimated $100,000 in financial aid funding. The Dental School and Veterinary School also lost some state money.
But while the budget is tuition-driving, tuition alone does not cover the full amount it costs a student to attend Tufts. Fundraising and returns on endowment investments bring in about $5 million and $7 million, respectively, which still leaves $75 million to be brought in from other sources. One of those is research grants, or "sponsored programs," a source of funding that is actually increasing next year.
An estimated $31 million of the budget next year will come from grants from the federal government, corporations, and foundations. Securing more federal grants has an added benefit to Tufts because the national government provides money proportionate to the amount of the grants to the University to cover "indirect costs" such as electricity and heating in laboratories -- costs that Tufts would be paying anyway since students and faculty are in the buildings.
In a year when the budget is crunched, the University finds ways to reduce costs by achieving greater efficiency. The consolidation of student services into Dowling Hall was not only convenient to students, it saved Tufts "real money," Bouchard said. He could not estimate the actual amount, but said it was somewhere in the hundreds of thousands of dollars.
Similarly, the reshuffling of the administration last year and the dissolution of the vice president post helped Tufts reduce costs.
That Tufts was able to balance its budgets without major cuts given the current economy and endowment shows that the University's finances are in good shape, Bouchard said. Other schools throughout the country have been hurt by low investment returns this year and decreases in alumni giving. Dartmouth, for example, had to cut $5.7 million from its budget for the next fiscal year.
The Arts, Sciences, and Engineering budget is drawn up by the Budget and Priorities Committee, a student-faculty-administrative group, in conjunction with the Policy Council, the group of Arts, Sciences and Engineering deans.
