Posted on 12/30/2024 8:16:34 AM PST by george76
Other universities also operate at or anticipate large deficits.
Brown University is facing a $46 million deficit that could grow to $90 million..
The deficit could “deepen significantly” according to an announcement from the Providence, Rhode Island university.
While the university has an endowment, it is already tapping it as much as reasonable.
The school announced the reasons for the deficit problems:
These include nearly flat net revenue from undergraduate tuition growth due to a steady size of the undergraduate student body, downward pressure on tuition increases, and increased financial aid; the macroeconomic factors of unexpected high inflation, growth in salaries and benefits, and national trends toward unionization; and rapid growth in faculty and staff positions coming out of the COVID-19 pandemic, with staff growth outpacing growth in faculty. We are also at the upper limit of the fiscally responsible range for taking contributions from the Brown endowment without reducing future resources available for financial aid, academic support and other priorities.
The university said it would “hold faculty headcount growth to 1%” and freeze staff growth. Brown also plans to bring in more money from its master’s programs by “ultimately doubling the number of residential master’s students and increasing online learners to 2,000 in five years.”
Faculty growth has outpaced student enrollment growth, according to The Brown Daily Herald.
Other major universities have reported similar deficits. For example, the University of Chicago ran a deficit of more than $200 million according to the student newspaper The Chicago Maroon.
The University of California system faces a half billion deficit by next summer, according to Cal Matters.
The UC system plans to address the issue in part by raising tuition for non-residents. The increase would mean non-residents may more than $50,000 per year, according to Cal Matters.
BTTT
Time to trim the fat ... any tenured lard-butt that is not teaching at least 4 classes a day gets sacked. That and drop any ‘studies’ programs they have.
$7.2 Billion endowment. Taking a reasonable 4% per year, there should be a sustainable $288 million a year thrown off even without any new contributions ever.
Of course, if they limit themselves to progressive investments, returns are likely lower.
These university “endowments” are often in illiquid assets like real estate, intellectual property, or preferred shares with long lock-up periods.
these endowments generally do supply cash dividends, but its surprising how much their daily operations are funded by tuition, and also cash donations from alumni.
I got in major trouble when I proposed a smaller budget from the previous year's, with a few obvious cuts in spending.
Chastened, I corrected my "errors" with a quick spending spree, and all was forgiven.
Guess they will have to dip into principal and sell some assets.
How much revenue is generated annually from the endowments?
With 11.3% return in 2024, Brown endowment provides record support for academic priorities
The endowment provided an all-time high of $281 million for financial aid and student support, scientific research and other priorities in Fiscal Year 2024, as Brown’s investments generated $728 million in gains, an 11.3% return.
Over the last decade, the endowment has produced $4.9 billion in investment returns and provided $2 billion to support Brown’s educational mission. Annualized returns for Brown’s endowment for three, five, 10 and 20 years are 2.8%, 13.1%, 10.8% and 9.5%, respectively.
https://www.brown.edu/news/2024-10-04/endowment
excuse me let me wipe my eyes, the sadness I feel for Brown University is indescribable
The feel-good story of the day! Let’s hope these universities collapse like the Soviet satellite states.
That sounds like a weather report.
Give me a day on the books and a couple boxes of red pens and the problem will be solved.
Brown is a hard left Ivy League school with a lot of very arrogant graduates.
I checked the current endowment....they seemed to get better than expected returns on their investments...now endowment is valued at 7.2 billion. If they lose 50 million a year that gives them 144 years to shrink their endowment to zero.
My guess is they recognize that less students are coming in and they want to push dei programs...If they want to give reparations...just give all qualified descendants of slaves free tuition.
Then they can get rid of bloated staff, increase workload of profs, cut athletic programs, cut out boutique majors like “.dei, government grifting, gender studies....”to cut their deficit.
What COVID taught us about “higher education” is that universities are bloated and much of what they do is unnecessary.
Universities need to be able to run on tuition of about $20,000/year.
There are going to be universities that offer one-level of non-discounted (i.e. no college-supplied student aid) pricing.
Spending $300,000 to let Junior or the Little Princess attend college is absurd.
Brown University has a lot of ugly buildings in my opinion.
A college buddy went to Brown for grad school. Went in a regular guy, came out spewing the most unadulterated collection of bullshit I’d ever heard. Brown is right!
How about you freeze staff positions at 30% of the current level. And scrupulously review programs and course offerings and look for opportunities to eliminate silly and/or irrelevant academic positions. Then focus on education, reduce tuition by say 20% to start, reinstitute core requirements, SATs for entrance and grades. You could be in the running for best educational university in the country since none of the other Ivy’s seem to want the job. I will send a bitcoin account for payment for my turnaround advice since you Brown guys seem not to have a clue.
“simple actions like cutting expenses and streamlining the programs.”
Implementing major DEI programs ain’t cheap. Plus hiring profs in lofty disciplines like basket weaving and women’s studies costs money.
So they can easily pay this
So they can easily pay this
An emphatic yes. Most of the Ivy League schools have such huge endowments that they could make college tuition free for its students.
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