By Mike Sherr
Managing Editor
The Signal met with President Kathryn Foster and Vice President of Student Affairs Sean Stallings on Tuesday, Sept. 20 to discuss specific topics regarding the fall 2022 semester, including the finances.
When the NJ legislature forms a budget for a fiscal year, it requires various government entities to answer questions about its finances to justify their funding requests. The College is no different and submitted testimony to questions from the NJ Assembly Budget Committee during that process. The submission included elements of general costs, finances associated with the Covid-19 pandemic and tuition increases.
General Costs
In the final FY 2023 budget, the NJ legislature appropriated $31.9 million dollars to the College. When asked about how this money will be used, President Foster first expanded on the different revenue sources of the College.
Foster explained that “$31 million is from the State of New Jersey. Roughly $145 million is from you all.” A majority of funding for the College is from tuition and fees. For the 2022-23 academic year, tuition is about $7,000 for full-time, in-state undergraduate students. Fees for the same group include student activity, student center and “general services.” Foster also explained that a further $50 million comes in from room and board.
Foster also mentioned that the College has to pay back debt from projects done throughout its history. The largest contributor to the debt the College holds is the construction of new buildings, like the Education Building finished in 2012 and the STEM Building finished in 2017. Foster explained that debt repayment has to be taken into account when thinking about the College’s finances.
“Our interest costs are well into the millions,” Foster said. “Our interest costs to pay back this year is just under $15 million.”
Foster said that rather than taking money from the NJ legislature for a specific purpose, the state allocates money that is added into the College’s funds in order to operate functionally.
Also, in the submitted testimony, the College indicated that there is $500 million in known deferred maintenance. This includes repair or replacement of elevators, parking garages, fire alarm systems, roofs, electrical systems, mechanical systems and athletic complexes. It also indicated that three residence halls need to be replaced but did not allude to which three.
When asked about the high value of maintenance needed, Foster responded that “when [she] came in the door about four years ago now, they said there was about $300 million in deferred maintenance. That’s not unusual for campuses.”
The income for the College, roughly $226 million not including donations, is broken down into two categories of spending.
“Sixty percent of that is used on compensation,” Foster said. “That’s salaries and benefits for faculty, staff and anyone else who is working here. The other 40% is going to everything else you see around you.”
The allotted 40% includes any items and any services the College provides, including utilities. It should also be noted that in the state testimony, it was stated that there are 39 administrators, 395 faculty members and 815 non-teaching staff working for the College.
“[The College has] housing, its got transportation, its got services, its got buildings, its got people,” Foster said. “Its essentially a city.”
Covid-19 Funds
In the submitted testimony, the College indicated that it, like many other institutions and businesses, went through financial hardships during the pandemic. The pandemic had an approximately $57.6 million net impact since the beginning of the pandemic. This was mostly due to the loss of revenue from closed and reduced residence halls, reduction in fees and increased operational costs.
“[The College] just gave back $13 million to students,” Foster said. “The future was uncertain.”
To mitigate some of the costs, the College decided, with support from the faculty and staff unions, to put every employee including Foster on furlough for 12 days during the summer of 2020. This saved the College money at the end of its fiscal year by “not expending it in the first place. People didn’t get paid for the twelve days they normally would have.”
“Everyone knew it was a scary time,” Foster said. “Rather than lay people off, we said if we all share the pain right now, we can get through this.”
In total, the College received about $15.4 million in Covid-19 related funds. These along with the furloughs were used to mitigate the decline in revenue. The submitted testimony states that “[The College] anticipates a slight improvement for the 2022-2023 academic year due to modest growth in enrollment and room occupancy.”
Tuition
According to Foster, this year's tuition went up four percent compared to last year. “This is during an era of inflation,” she said. “We try to keep it low, but the pressure on the cost side was significant.”
In the 2020-2021 academic year, total cost did not go up at all and was even reduced by 12%, a reduction of mandatory student fees. Foster said that the College could not justify an increase in tuition.
“We can’t ask you to pay a Student Center fee if you’re not here,” Foster explained.
The tuition and fees then increased by just under three percent for the 2021-2022 academic year in order to reintroduce the mandatory fees. In total, tuition did not have a net increase at all between the fall of 2020 and the spring of 2022.
Foster did note that the increase in tuition was coupled with an increase in financial aid available to students.
“Some of the money we get in is essentially redistributed to people who need it,” Foster said.
She went on to say that the College would “take in money from a student who has the means… turn it around, and in addition to federal aid, Pell grants and state aid we’re giving over 20 million back to students.”
While inflation is still rampant, it can be expected that tuition will also rise, but with a simultaneous increase in student aid. Therefore, the impact might not be as difficult for those students who are in need.
