Where is college tuition money going

You must be logged in to post a comment. Leave a comment. Cancel reply You must be logged in to post a comment. Colleges and universities have numerous ways of generating revenue to run their budgets and educate their students. These include the tuition and fees that students pay to earn their degrees. But making money can be challenging for schools of higher education when attendance lags. For the spring term, total college enrollment fell by 3. Lower enrollment numbers can increase the pressure on schools to find new ways to generate revenue—or force them to cut their budgets, increase tuition, or even close their doors.

Colleges and universities can receive funding in a diverse range of ways. Where schools get their money from can depend on whether they're a public or private institution, or if the school in question operates on a for-profit or not-for-profit basis. For starters, colleges and universities, including both two- and four-year schools, receive significant funding from the federal government.

This money was provided to schools in three ways:. And all types of schools receive tuition revenue and other non-federal funding revenue, but how the formula works differs by type.

Tuition and fees paid by students represent a large share of the funding pie for public colleges and universities. State universities also receive funding from state tax revenues, but that amount has decreased significantly in recent years. Endowments are another revenue source. An endowment is money that's invested in a college or university with the goal of supporting its mission.

Schools that receive endowments may use this money to fund research projects or to expand aid packages for eligible students. Private colleges and universities also generate revenue by charging students tuition —considerably higher tuition than at public colleges.

Aside from tuition, private schools also receive funding through endowments. This money was used to fund specific academic programs and scholarships offered by the school. Large endowments mean that some schools are able to offer very generous scholarships to offset their high tuition costs. Private colleges tend to be more expensive than public colleges or universities because they don't receive state funding.

Whether a school operates on a for-profit or nonprofit basis can influence how it makes money and how much it costs students to attend. It can also influence the quality of the education a student receives and how money is reinvested into the school's education programs.

Harvard, for example, is a private university that operates on a nonprofit basis. That means the money it receives from endowments, tuition, or other avenues is reinvested into the school. As a nonprofit, the school also enjoys tax-exempt status at both the federal and state levels. Research grants, gifts, and other sources of funding accounted for the rest of the school's revenue numbers. Students who are considering a for-profit university should weigh the school's accreditation status, graduation rates, and overall reputation to help decide if it's worth the money.

Sports can be a big moneymaker for public and private colleges and universities. Some of the most popular—and most profitable—sports for colleges and universities are men's football and men's basketball, followed by other men's sports and women's sports, respectively.

As for where it goes, s pending on instruction includes faculty salaries and benefits, as well as the cost of administering academic departments. Academic support includes spending that's academic in nature but not directly related to teaching or research, such as supporting libraries, computer labs, and museums. Institutional support is other administrative spending, such as presidents' and vice presidents' salaries. And public service can be anything from public broadcasting to hosting conferences.

If the financial aid figure seems small, it's because the most significant financial aid most colleges provide is a tuition discount. Those discounts aren't counted as spending in the Delta Cost data. Spending at private research universities breaks down about the same way — they just spend a lot more per student:. Four-year in other categories have spending that breaks down along similar lines, although colleges that don't grant Ph. Ds spend much, much less on research than research universities do.

Our mission has never been more vital than it is in this moment: to empower through understanding. Research Includes all activities specifically organized to produce research outcomes, whether commissioned by an agency external to the institution or separately budgeted by an organizational unit within the institution.

Public Service Includes funds expended for credit and non-credit distance education courses; non-instructional services beneficial to individuals and groups external to the institution such as community service programs, cooperative extension services, conferences, institutes, references bureaus, radio and television, consulting, and similar non-instructional services to particular sectors of the community.

Institutional Support. Institutional Support includes: central executive - level activities concerned with management and long-range planning of the entire institution fiscal operations personnel administration logistical activities that provide procurement, storerooms, safety, and security support services to faculty and staff that are not operated as auxiliary enterprises activities concerned with community and alumni relations including development and fund-raising.