New Financial Plan Boosts Undergraduate Aid
March 9, 2010
Investing in the university’s commitment to financial aid is one of the major focuses of the five-year financial plan approved by the Georgetown’s board of directors in February.
“The downturn in the economy has been experienced all across the country, and we expect the need for financial aid will continue to grow,” President John J. DeGioia says. “We must ensure that family income is not a barrier to coming to Georgetown and thriving here.”
The board approved an 8.6 percent increase in funding for financial aid at the Main Campus as part of the university’s commitment to meeting full need.
“We’ve worked to model aggressively any possible scenarios that would place increased demand on our commitment to provide financial aid,” says Senior Vice President Christopher Augostini, who also serves as the university’s chief financial officer and treasurer.
Stable Ground
Much like other U.S. colleges and universities, Georgetown is riding out the effects of the economic crisis. The university’s financial plan is designed to keep the university on stable ground, says Senior Vice President Christopher Augostini, who also serves as the university’s chief financial officer and treasurer. "The university saw a loss of $12.5 million for fiscal year 2009 ending June 30 -- lower than the projected $14.9 million loss budgeted in the financial plan. The university projects operating losses for the next five years partly due to the credit crisis and recession.
“If you go back to last year’s plan, I think we had all the areas of concern right when we were constructing it,” Augostini says. “We knew assets would decline. We knew areas such as philanthropy and other revenue were going to be impacted along with financial aid.”
Last year’s plan focused on an adaptive and responsive strategy that proceeded cautiously on expenditures, froze spending on discretionary capital projects, and preserved liquidity in both operating and endowment funds. The current financial plan is built upon conservative fundraising assumptions but enables strategic spending.
Stimulus research funds helped pad the blows to the university’s financial plan. Georgetown has received more than $30 million in grants made possible by the American Recovery and Reinvestment Act. About 7 million of those funds will go toward construction of the new science facility, which was delayed last year because of the economic climate.
“The science center is now fully financed and is a key component in the financial plan,” says Augostini.
Augostini and David Rubenstein, vice president of financial planning and analysis, say the stimulus money provided extra resources that couldn’t have come at a better time.
“Stimulus funds for research grants are really one of the things that’s helping us out,” says Rubenstein. “That funding really worked from the federal perspective. It did what it was designed to do, which was to spur the private economy.”
Limiting Tuition
Just as the university has been affected by the economy, university leadership considered the effect on students and their families, limiting the increase on undergraduate tuition, which will rise 3 percent next year to $39,768 -- compared to $38,616 this year.
“These uncertain times require that we balance the need to limit tuition growth with the university’s commitment to supporting our top-notch faculty and providing exceptional academic programs and services,” says Provost James O’Donnell.
—Nia Hightower
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