Related Articles: Higher Cost Education |  The old college try

Higher cost education

It doesn't take a college degree to see that earning one grows more expensive every year. Yet, while a Tcu dgree isn't cheap, it may be more justified (and competitive) than you think.

By David Van Meter

Matt Hood '91 opened two letters in the spring of 1987.The first one admitted him to TCU, his first choice of schools.

The second one came a few weeks later, detailing the University's financial aid package offer.

"I really remember that day," said Hood, now living in Austin and married to Dawn Prillaman Hood '89. "I got the letter and looked at the financial aid package and asked my mom:

"Is it enough? Can I go?"

Hood's two questions are hardly unique. These days, the only emotion that outdoes the excitement of college is the anxiety of its cost. In 1998, Newsweek polled parents of children under age 4 to find out the greatest anxiety these parents face in raising kids. Number one was kidnapping and violent crime.

Number two?

The rising cost of college.

The National Commission on the Cost of Higher Education was formed in 1997 to get to the bottom line of those increasing dollars. According to the commission's findings last year, the cost of attending the nation's private universities rose from $10,911 in 1987 to $18,387 in 1996, a 69 percent increase.

At TCU, the sum rose from $8,822 to $16,510 during that same time, a 78 percent increase. However, TCU's cost remains lower than many of its peer institutions. Still, it's expensive. Why?

For a university that started in a one-room schoolhouse with 13 students and now instructs 7,200 students in 63 buildings, TCU's "cost drivers" (to borrow a Commission phrase) can be found in six areas: faculty, facilities, technology, regulations, financial aid and expectations

Faculty

In 1998, TCU's operating budget reached a record $134 million. The number one expenditure, by far, was $47 million for instruction. (The two budget line runners-up were student aid and student service, allotted $16.5 million each.) Last year, the average TCU full professor earned $78,000, 40 percent more than a decade ago and squarely above the average listed by the American Association of University Professors (AAUP), the benchmark for faculty salaries.

Provost William Koehler appreciates the statistic, but disdains the average. "Suppose you have one foot on a block of ice and the other foot in a bucket of boiling water," he said. "The average temperature of your feet is 50 degrees Celsius, but I guarantee neither one is very comfortable.

"What we look at is whether we're competitive discipline by discipline within the marketplace, although we do have a goal to meet the AAUP average because that's one of the ways we're ranked."

A better number to look at, Koehler suggests, is the latest University teaching initiatives, specifically, 21 new faculty positions to replace "occasional" faculty and instructors. The coming academic year also marks $500,000 for outreach and educational programs targeted to the business community. Chief among these efforts is an educational center -- offering an executive MBA track, an MLA degree and other courses and seminars -- to be established at Alliance Airport in north Fort Worth.

Technology

Another line in TCU's 1999-2000 budget earmarks $5.2 million for classroom equipment and research equipment in the field of information technology and science. That's only the latest for an ever-growing expense. In 1995, the University spent several million dollars to install a fiber optics network campus-wide. Since then, computer labs have almost doubled in size and hours of operation. While TCU finds itself firmly in the fast lane of the information superhighway, it comes at tremendous cost. The computers in use 15 years ago lasted nearly a decade. Today, souped-up Pentiums and G3s are obsolete and replaced in five years or less.

Facilities

Not counting the University's $30 million construction project underway for an enhanced athletics program, TCU has built four major structures since 1993 -- the Winthrop Rockefeller Building for Ranch Management, the Dee J. Kelly Alumni and Visitors Center, the Walsh Complex and the Mary D. and F. Howard Walsh Center for Performing Arts -- and has at least two more planned for the next few years -- the William and Jean Tucker Technology Center and expansion and complete renovation of the Brown-Lupton Student Center. The only other time the University built at such a rate came during the E.M. Waits administration in 1916-41. Of course, gifts underwrite these new buildings -- and the flowers that surround them -- but they do impose ongoing costs such as air conditioning, lighting and maintenance.

New construction aside, TCU spent more than $10 million in 1995 to replace its aging cooling systems for more-efficient, environmentally friendly air conditioning. TCU has also sold roughly $90 million dollars in bonds -- it's cheaper now to borrow money than to dip into investments earning double digits -- to renovate most of Worth Hills and TCU's other residence halls as well as to finance some of the construction of the Tom Brown-Pete Wright Residential Complex.

Regulation

In 1997, TCU planned to raze aging apartments and houses to make way for housing for Brite Divinity School students and their families. Yet, before the buildings could be demolished, regulations required TCU to spend thousands to remove asbestos -- just one example of growing state and federal rules.

The list goes on. Daniel-Meyer Coliseum and Amon Carter Stadium currently violate the Americans with Disabilities Act (ADA). Several million dollars spent in the next two years will provide more handicapped seating, elevators and restrooms in both facilities. In other parts of the campus, readers are being made available for blind students, signing for deaf students. Fire codes have become more stringent, as have disposal procedures for radioactive and biohazardous waste.

And unlike other businesses that may have to comply with one or two regulations, TCU is like "a small city," Koehler said, in the vast number of regulations it must follow. "But we're not complaining; most of the regulations are good. But they are expensive."

Expectations

Allison Holt '88, director of admissions marketing, was here as a student a decade ago, and today she's the person responsible for telling students what they can expect when they arrive.

Much of it is what you expect. Small classes taught by full professors. Special seminars especially for freshmen. Study-abroad opportunities. Writing enhancement. A safe, well-lit campus. The things a good liberal arts and sciences college should provide. But how about Internet connections and cable television in every room? Four new parking lots since 1995 on the east campus even though most students could walk to class in 15 minutes or less? A Pizza Hut and a coffee shop that serves espresso and cappucino made with the famous Starbucks coffee? Not to mention some 209 official cocurricular things to stave off any chance of boredom.

"To tell you how much things have changed, when I was a student, we had to get to the Main for dinner at 4:45 because it closed at 5:30," Holt said. "Now, it stays open until midnight and there's even a sub shop in the business building."

But as Holt rightly points out, if TCU doesn't provide most of what students expect, then they will choose other schools that do.

"They still go to college for the same reasons their parents did, but now they also carefully consider the amenities."

Financial Aid "Surely you want my son," said Financial Aid Director Mike Scott, recalling the argument he perpetually hears from parents, "and I know you have a lot of money. Why are you only offering me a thousand-dollar scholarship?"

Scott's reply is always roughly the same. "We're spending $10 million this year on students, including your son," he said. "That's a lot of money in aid. And it doesn't include the scholarships we give in athletics or to graduate students."

In fact, TCU gave $10.7 million in institutional aid last year. The average aid package, composed of institutional, state and federal monies, was $9,286 per student, allowing most students who qualified for financial aid to attend for about half of the total cost.

Sure, $10.7 million in institutional money is a lot -- and it grows at a rate equal to or greater than that of tuition -- but is it enough? Perhaps the better question is, How much of the tuition you bring in do you send back out in the form of scholarships? Scott calls it the "discount rate" and contends that putting a tremendous amount of money back into scholarships is not necessarily a good thing.

"Some universities play the game where tuition is jacked up on everyone and then give virtually everyone who comes in the door some kind of scholarship," Scott said. "That causes us trouble when they come to us. They didn't even meet our minimum scholarship standard, and another school is giving them one. How do you say to that student, 'Well, they give everybody a scholarship? '
"On the other hand, you do have to make sure that you have the aid available that will enable you to make your class, retain students and help the students who really need and deserve it."

THE COST of higher education continues to rise, but in recent years at a rate much closer to inflation. TCU's tuition is no exception, even with a record-high $156 million budget approved in the spring. In fact, only about 60 percent of that money comes from tuition.

About six percent comes from gifts and grants. Where does most of the rest come from? TCU's endowment. With a current market value of $825 million, it ranks among the nation's top 50 college funds. The money is conservatively invested. Some proceeds are returned to the endowment; the rest, some $35 million this year, is used to offset the total cost of a TCU education, about $18,000 for students this fall.

Admissions Dean Sandy Ware knows that number all too well as she and her staff of 35 search state and country for the best-matched students for TCU.

"Sometimes a look of horror comes from Texas parents who see our price tag," Ware said. "Yet, I talk to similar parents in the Northeast who see $18,000 and wonder what our college experience could be like for that little money. Well, thanks to our endowment, we haven't had to raise tuition by double digits. Many of our competitors are more tuition-driven than we are."

Ware adds that TCU has also implemented a number of new scholarships to combat higher costs, including a Provost's Scholarship that pays three-quarters of tuition, special study abroad scholarships for the TCU London Centre and 50 additional returning student scholarships over the next three years.

"I think the key is understanding our special niche in higher education," she said. "TCU has tremendous success stories by enabling people to come here who otherwise would not have been able to afford to."

Another two cents to subtract from the higher cost of education might be this: A college education's return still seems to be worth the investment.

According to the Education Research Institute, jobs that require a bachelor's degree should grow by 27 percent over the next decade, the average starting salaries rising faster than inflation. The U.S. Census Bureau reports that college graduates earn an average of $12,000 to $14,000 more per year than high school graduates, with the lifetime earnings differential between high school and college graduates about $1 million.

The incoming TCU freshman of 1999 will spend about $70,000 to $80,000 over the next four years covering all the costs associated with acquiring a TCU degree. That expense represents less than 1 percent of the additional income the TCU degree will make possible for them during the lifetime career that follows.

In the financial community, that is known as a highly leveraged investment.