NYT: A Small College Struggles With Economics

[ellisonz]

A Small College Struggles With Economics

By JONATHAN D. GLATER
Published: June 9, 2009

PORTLAND, Ore. — The admissions team at Reed College, known for its free-spirited students, learned in March that the prospective freshman class it had so carefully composed after weeks of reviewing essays, scores and recommendations was unworkable.

Money was the problem. Too many of the students needed financial aid, and the school did not have enough. So the director of financial aid gave the team another task: drop more than 100 needy students before sending out acceptances, and substitute those who could pay full freight.

The whole idea of excluding a student simply because of money clashed with the college’s ideals, Leslie Limper, the aid director, acknowledged. “None of us are very happy,” she said, adding that Reed did not strike anyone from its list last year and that never before had it needed to weed out so many worthy students. “Sometimes I wonder why I’m still doing this.”

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With their endowments ravaged by the financial markets and more students clamoring for assistance, private colleges like Reed are making numerous changes this year in staff, students, tuition and classes that they hope will tide them over without harming their reputations or their educational goals. Reed and others have admitted more students to bolster revenue with larger classes. Many are cutting costs by freezing or reducing salaries, suspending hiring and postponing building maintenance and construction. And the cost of attendance is rising; in Reed’s case, by 3.8 percent, to nearly $50,000 a year for its 1,300 students.

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http://www.nytimes.com/2009/06/10/business/economy/10reed.html

[JerseygirlCT]

1. It sucks, it really does

Private colleges are going to have to really get a grip on expenses. They're going to have to put aside those fancy building projects - even though they offer the sexy naming opps for big donors. They're going to have to focus on what their core business is: education.

I'm certain this is happening at my (and my child's) school now. More foreign students being admitted - which is cool from a diversity point of view, but which I've suspected is also driven by a "paying the full freight" rationale as well in many cases.

Truly, I still cannot understand why tuition that was less than 7k thirty years ago is now 50k. Somewhere along that line, expenses were allowed to go haywire - across the board at these places.

I think they need to go to their boards, get ok's on spending down more of their endowments, lower costs by a lot, maybe lessen staff... cost-cutting is going to be necessary unless they want to see private college as even more of a province of the very, very rich.

[latebloomer]

2. When I went to a private college in the 70s

my middle-class parents were able to pay for it out of their income without a huge stretch.

Now you have to save the kid's entire life and you still have nowhere near enough.

Yes, the day is rapidly approaching when college will be only for the wealthy

[JerseygirlCT]

3. It's just so highlighted for us

since he's attending his parent's school.

We weren't rich as kids, but I was fortunate to have parents who insisted on paying for us - and there was no aid. They probably took a 2nd or maybe 3rd mortgage, and one brother insisted on doing ROTC (his choice, not theirs), but that still meant 3 kids through college.

I'm very glad that my two are widely spaced. And writing those huge checks twice a year is pretty terrifying. It's like buying another house - only without a mortgage!

[latebloomer]

5. Mine are two years apart

and the fun starts a year from now! :scared:

(I know, poor planning, but I was OLD!!)

[JerseygirlCT]

6. I'm crossing my fingers and sending

scholarship vibes your way!

(Mine was actually offered some money - merit - but not at his 1st choice. How do you turn down his first choice when it was your own school that you love?)

I guess the good news is that they will offer that money - not grants, but outright money - for the students they want. Just a matter of finding the right match!

[latebloomer]

8. Thanks!

I think that might actually happen for my younger child. My older?- not so much.

[Captain Hilts]

10. No one in my high school class of 700 in '77 went to a private college.

Just not an option for military kids and such.

[xchrom]

4. reed? -- wow -- that's a good school.

i know that schools have been hard hit -- but that's remarkable -- and sad.

[JerseygirlCT]

7. I think this will be more the rule than the exception at lots of the

really good private schools from now on. It's a real shame.

[xchrom]

9. makes me sad -- thanks for the update. nt