ND tuition hiked 4.9 percent percent hike
By LAUREN BECK
News Writer
University officials recently announced an increase in undergraduate tuition that raises average costs to $32,020 for the 2002-03 academic year and matches last year's 4.9 percent, touting the two as the lowest percentage increases in more than 40 years.
The 4.9 percent hike, which University President Father Edward Malloy revealed in a recent letter to the parents of freshman, sophomore and junior students, translates to a $1,490 total increase in current costs. It raises tuition to $25,510 and room and board to $6,510.
The Board of Trustees has approved annual increases in tuition for the past four decades. The past two years' percent increases have been the lowest since 1959, when there was no increase from the previous year.
The tuition hike was primarily due to growing expenses and a slowing economy, officials said.
"When we consider everything taking place at this University in order for it to grow and become better, we see some extraordinary expenses," said Dennis Moore, university spokesman. Moore cited the new Center for Performing Arts as an example of an additional expense to the operating budget. Alumni donations financed the construction of the Center, but the University's annual budget must now cover maintenance, staffing and other operations expenses.
"We are a tuition-driven institution … and if the operating budget is to grow — and this includes increases in salary, additional operating costs — that necessitates an increase in tuition," Moore said.
According to Scott Malpass, vice president for finance and chief investment officer, tuition and fee revenue make up about 55 percent of the total budget, so in effect students pay 55 percent of the actual cost. Revenues from the bookstore and athletic programs as well as earnings from the endowment make up for the difference.
Notre Dame's endowment, which is among the 18 largest educational endowments in the nation, is valued at approximately $3 billion. Most of this money is donated for a specific purpose and cannot be used to defray tuition costs. Only about 10 percent of the endowment is comprised of unrestricted funds that may be used freely.
A downturn in the economy presented an added challenge to the budget this year, as growth in the endowment slowed.
"We're operating in a different economic environment now, and this may affect the endowment and the budget. Nobody is certain what will happen in the next few months, so we have to account for that," Moore said.
In his letter to parents, Malloy acknowledged that other private institutions increased their rate of tuition growth to respond to the slowing economy, while Notre Dame maintained its previous percent increase. Instead, University officials would respond by limiting salary increases and budget additions.
While increasing tuition, the University strove to maintain its dedication to financial aid.
In the past decade, the inflation rate has been in the 2 to 3 percent range, while tuition has increased in the 5 to 6 percent range, said Malpass. Students often raise this criticism, but Moore called it an inaccurate comparison.
"Inflation takes into account the normal cost of living and maintaining a household. We have to consider atypical expenses like salaries, new equipment, books, technology, competing for the best professors and facilities which are built through alumni donations but whose operating expenses are not covered by the gifts and then become part of the budget," said Moore.
The Board of Trustees also approved three other tuition increases. Graduate school tuition is up 4.6 percent, to $25,410, and tuition for both the Law School and the Master's of Business Administration Program will increase by 4.8 percent to $26,110.
All News Stories for Tuesday, March 26, 2002
