SU adapts to nationwide financial recession
Undergraduate tuition at Syracuse University for the current academic year is $32,180. That’s more than a $1,700 increase from last year, according to figures on the university’s Web site.
Many students are aware that the cost of tuition rises each year, but only some understand the reasons for the increased cost.
Jessica Phillips, freshman broadcast journalism major from Philadelphia, came to SU because of the S.I. Newhouse School of Public Communications. She said she thought the eventual benefits of graduating from Newhouse would justify the costs, but she still has trouble understanding why the price is so high.
‘You know it’s expensive, and you don’t know why,’ Phillips said.
Gwenn Judge, SU’s director of budget and planning, said there are several factors that determine the tuition level. One factor is the country’s rate of inflation.
In 2007, the inflation rate was 2.85 percent, according to the Financial Trend Forecaster’s Web site, yet SU’s tuition rose 5.7 percent from 2006-2007 to 2007-2008.
Judge said tuition outpaces inflation because many of the university’s costs, such as technology, also rise faster than inflation, and the university needs to respond to those changes.
The university also looks at what competing institutions charge their students. SU is the 27th most expensive school on a list of private institutions posted on the Office of Budget and Planning’s Web site.
Judge said SU needs to keep its costs competitive in order to attract students, which can be difficult, because some schools have more resources.
‘We do not have as large an endowment as a lot of our competitors,’ Judge said.
For that reason, Judge said another factor to determine SU’s tuition is the tuition cost of other universities.
But the university’s endowment and assets have been growing in recent years. The endowment fund has more than doubled in the past 10 years, reaching a value of more than $1 billion in 2007, according to SU’s Web site.
The university’s net assets increased by about $450 million from June 2002 to June 2008, according to the forms the university needs to file with the IRS because of its tax-exempt nonprofit status.
Undergraduate tuition rose 49 percent in the same time period. Judge said the value of the net assets can be misleading. Much of the money is tied up in long-term investments and cannot be used in the everyday operations of the university.
Lou Marcoccia, SU’s executive vice president and chief financial officer, said the current economic crisis could reverse some of the financial gains made earlier this decade. SU’s 2008 IRS forms revealed a 9 percent decrease in net assets during 2007-2008.Marcoccia said 2008-2009 could be another bad year.
Regarding tuition increases, he cited a number of costs that rise every year, including salaries and benefits for personnel, energy costs and inflation for goods and services.
Marcoccia said one reason SU is expensive is the students expect high-quality facilities and services. Judge echoed those sentiments, saying students want the best in food services, safety and technology. She said today’s students expect more from their residence halls, such as private bathrooms rather than communal ones.
Marcoccia said the school charges students the absolute minimum it can afford. He also said financial aid has risen in recent years, reducing the out-of-pocket cost for many students’ families, and making it possible for more low-income students to attend the university.
Ryan Wellman, junior information management and technology major, said he had ‘no idea’ where his tuition money goes.
‘They’re just trying to get more and more people to come, to make more and more money,’ Wellman said.
Some university officials and employees command high salaries, but Marcoccia said people like Chancellor Nancy Cantor still earn much less than they could make in private industry.
SU paid Cantor more than $1 million last year, but that includes a $500,000 retention bonus for completing her original contract. In a fiscal update released Nov. 13, Cantor stated she had donated her bonus to the university.
In the same update, she announced that the university’s response to the economic crisis would include a salary freeze for cabinet officers, the academic deans and the chancellor herself. Cantor’s $550,000 salary is about average for the head of a private university.
Marcoccia said he thinks people such as Chancellor Cantor deserve to be paid more than they receive because of the demanding and difficult nature of their jobs.
Phillips, the SU freshman, said she feels the same way about her mother, a Philadelphia police officer. She said her mother deserves a higher salary for putting herself at risk every day.
‘I know it’s not easy for my parents to send me here,’ Phillips said. She said she thinks the university could be more transparent about the reasons for the cost.
‘You do pay the money,’ she said. ‘You should know where it’s going,’
Phillips did not know how she would address such concerns with the university.
SA president Marlene Goldenberg said she has not heard from students on the subject of tuition costs as much as she thought she would. Goldenberg meets with Chancellor Cantor on a monthly basis, and they discuss student feedback.
Marcoccia said the opinions and concerns of students are taken into account when the university makes financial decisions.
‘We would be less than bright to not listen to what people are saying,’ he said.
