In light of potential higher education budget cuts, I decided to calculate how much of the University of Illinois’ tuition dollars end up in instructors’ pockets.
I teach 125 Computer Science students. Assuming they are all in-state and they are all 3-hour students, they pay about $1,655 to take the class. This adds up to $207,000 paid to the University. It’s actually much higher than that because about half my students are out-of-state and pay double the in-state tuition and I have about a half-dozen 4-hours students.
My salary and the grading staff pay is only about 13% of that $207K. So the vast majority of those tuition dollars goes to things other than actually teaching the class. By way of comparison, when I teach overseas I am paid between 50-60% of the course cost.
Don’t mistake this as a gripe about my pay, I do this because it’s fun and to help deal with a very critical skill shortage in my field.
Some of this is necessary overhead. However, many of the typical overhead costs are paid (or at least subsidized) by student fees like the Academic Facility Maintenance Fund Assessment (for buildings), Transportation Fee, Library and Information Technology Fee and others.
Doing some spot checking of other lecturers on campus I found between 10% and 30% of tuition dollars ended up paying those who actually perform the service people are paying for.
And it’s just as bad on the research side.
The University charges 58% to federal grants for unitemized “overhead charges”. So a large portion of research dollars are spent on things other than direct costs of actually doing the research the institution was paid to do.
The University of Illinois has two missions: teaching and research. The question is why is a majority of the funds in both categories not being spent directly on those missions?
The answer lies in the fact that while the number of students has remained generally flat or grown slightly, the growth in the number of non-teaching administrators has skyrocketed. In the last 25 years, the number of administrators has doubled according to a recent study. Here is a helpful graph to show the problem:
This isn’t to say that support staff are unimportant or that the University needs no administrators. I know in my department I rely on the good work many people do. That said, many faculty members have remarked they don’t feel like the University’s mission is to support those who do teaching and research. They feel that it’s the mission of researchers and teachers to support an ever-burgeoning bureaucracy that delivers nominal benefit to students. With the number above, it’s easy to see why.
The Governor’s budget can easily be spun to say it will cut academic opportunities to college students. Or it can be an opportunity for higher education to focus on its core missions and trim those functions that do little to no good in making it happen.
Are the teachers pension costs factored into his calculations? Just wondering?
Comment by Secretariat Friday, Feb 20, 15 @ 1:45 pm
This is dangerous as it will only add fuel to the fire. If cuts do come, they are likely to come in the form of faculty reductions and not administration. I hear where he is coming from, but when is the last time that cuts in particular areas were specific and mandated? Without such specificity, the administration will continue to be bloated but faculty will shrink and classroom size will increase dramatically — not exactly what the author of this has in mind…
Comment by ash Friday, Feb 20, 15 @ 1:46 pm
===Are the teachers pension costs factored into his calculations?==
Those are paid by state taxpayers.
Comment by Rich Miller Friday, Feb 20, 15 @ 1:46 pm
===This is dangerous as it will only add fuel to the fire===
Facts ain’t dangerous.
Comment by Rich Miller Friday, Feb 20, 15 @ 1:48 pm
Thanks for the explanation.
Comment by Secretariat Friday, Feb 20, 15 @ 1:49 pm
Secretariat-
In my case, I’m non-benefits eligible but I do pay into SURS (with the state paying the other half). There are, of course, the various payroll taxes the University does pay which I didn’t figure into this. It was more an exercise in napkin math.
Ash-
I hear you but without stating the problem, how does it change?
Comment by John Bambenek Friday, Feb 20, 15 @ 1:49 pm
Are the big bonuses paid to outgoing U of I administrators figured into this?
Comment by Qui Tam Friday, Feb 20, 15 @ 1:50 pm
I am curious how the University gets away with a 58% cut of federal grants. It would seem to be a sort of fraud.
Thank you sir for the info.
Comment by Mason born Friday, Feb 20, 15 @ 1:51 pm
Qui Tam-
As far as I know, generally the outgoing administrators go to the faculty. We’ve done this so many times now, when we calculate that top 10 salaries of people in similar positions to figure out what to pay them, it’s mostly fired administrators we compare them to.
Comment by John Bambenek Friday, Feb 20, 15 @ 1:52 pm
I disagree with JB on everything I can think of and enjoy lampooning him whenever I can. That said, I agree with him on this.
I’m not sure they deserve a ~30% cut as Rauner proposed, but these institutions need to do make some serious changes or they will cease to exist.
Comment by Anonymous Friday, Feb 20, 15 @ 1:53 pm
The facts are damning to the university’s argument on the cuts.
They have to be held accountable for what they have done by creating these bloated administrations.
Comment by Cassiopeia Friday, Feb 20, 15 @ 1:53 pm
Does the 58% skim (about 18-20% higher than other Computer Science college grant overheads) include their costs of lobbying and maintaining clout lists?
Comment by Qui Tam Friday, Feb 20, 15 @ 1:53 pm
I have limited knowledge of the university compensation world or personnel structure. What little I do know would incline me to think that reductions all around would be possible without a negative impact on instruction. That has been happening at k-12 for 5 years now. It is tough but our support staff, especially office, are not compensated in the same realm that I here from the University world and we are a university community.
Comment by JS Mill Friday, Feb 20, 15 @ 1:54 pm
The question that needs to be asked of all of the schools, is why when they talk cuts they don’t talk about cutting administration?
There was a Doonesbury comic years ago about cuts at Walden College and two adminstrators were talking about cuts and the one mentioned the administration, the other said…
“We are cutting fat, not marrow”
If some state figures out how to do higher ed decent with a low cost (not research, but just education as it were) the competitive advantage the state will pick up will be huge.
Comment by OneMan Friday, Feb 20, 15 @ 1:55 pm
Qui Tam & Mason Born-
U of I is not alone in this skim, it’s rampant in higher education. As I understand it, its negotiated with grant agencies (and for that matter, if the grantor is the state or a private party, negotiated with them).
It isn’t an unknown quantity going into the grant-giving business.
Comment by John Bambenek Friday, Feb 20, 15 @ 1:55 pm
Interesting. I wonder how much of the student dollars are going to pay for new academic building expense/cost overruns with new academic buildings?
Comment by Robert the Bruce Friday, Feb 20, 15 @ 1:55 pm
This seems to raise a question (a good one), but doesn’t provide any real answers. More details from someone who knows the answers, please.
Comment by Anon Friday, Feb 20, 15 @ 1:55 pm
Thanks JB.
Comment by Qui Tam Friday, Feb 20, 15 @ 1:56 pm
The Education Complex has taken on some of the traits of the Military Complex in terms of accounting. I’ve seen these kinds of studies before. This one, while ‘back of the napkin’ calculating, at the very least, provokes the need to look much closer. If you’ve been paying these tuition and fees long enough, you realize we’re talking about a lot of money.
Comment by A guy Friday, Feb 20, 15 @ 1:58 pm
Who needs tax funded college sports? Anyone? Just an idea, the school I went to, we were horrible at sports…but not sure where the money came from (tuition, taxes, sport venues??) to build a new stadium and uniforms/equipment, coaches, etc etc etc. Nothing wrong with college sports…just curious if our taxes pay for it.
Just an idea…taxes shouldn’t go to sports…nor should the NFL be considered non-for profit for that matter…but maybe that’s just my opinion.
Comment by shanks Friday, Feb 20, 15 @ 1:58 pm
That might be the one up side of more state funding cuts, it might force the reduction of administration…
What happens if they say 50 or 75% of the cuts must come from administrative costs?
Comment by OneMan Friday, Feb 20, 15 @ 1:59 pm
Supports the meme that government does less with more while pretending to help the students.
I wonder how they compare to other state schools.
Comment by Plutocrat03 Friday, Feb 20, 15 @ 1:59 pm
I need to correct some of the math here. The overhead rate is 58%. So for a $100K research grant, the university tacks on $58K, totaling $158K. Thus the university overhead is 58/158 or 37%. Some of this goes back to the department, and depending on the department, some may go back to the professor.
So the statement that the university takes the majority of research dollars needs modifying to ‘takes about a third.’
Comment by OldIllini Friday, Feb 20, 15 @ 1:59 pm
@Plutocrat03
Title IV institutions (see the chart) include pretty much every college and university in the United States, whether public or private.
I wonder whether institution by institution data is even available, somewhere.
Comment by Helpful Hardware Man Friday, Feb 20, 15 @ 2:01 pm
The President of ISU (a school I sent a lot of money and one student to) has spoken in terms of who his mission is to protect. And it appears to be the same folks Mr. JB refers to.
Students are simply the stock.
Comment by A guy Friday, Feb 20, 15 @ 2:01 pm
As a fellow UIUC-ite who is not an administrator, I say that many of the administrators are necessary because of all of the rules and regulations.
We have ethics training. We have recognizing child abuse training. We have mandatory time reporting and conflict of interest forms to fill out.
If I make a personal call to my parents in the suburbs, that’s a $.07 charge (despite the fact that these are IP phones). So a bean counter has to bill me and I have to pay $.07, and then they have to enter it in.
Then we have people monitoring every purchase to make sure approved vendors are used, orders aren’t being strung together, etc.
Just let me do my job and I’ll get a lot more done, and then we won’t need all of these people watching me.
Comment by Stuff Happens Friday, Feb 20, 15 @ 2:02 pm
This web site has a couple of documents that might be useful for this conversation:
https://www.obfs.uillinois.edu/government-costing/facilities-administrative/Urbana-Champaign/
In the right sidebar, there are two PDFs. One has a breakdown of where the 58% goes, and the other has a chart showing the F&A (overhead) rate for the last 20 years. I was surprised to see that it hadn’t gone up as much as I would have expected — it was 53.3% in FY1992.
Comment by TooManyJens Friday, Feb 20, 15 @ 2:03 pm
Is this 125 students for one class or for all students taught both semesters? I could not determine that. If for only one class, 125 students in Computer Science is ridiculous- unless they are so computer versed they do not really need the class.
The salary for this instructor and grading assistants came out to $27K. Again is this for one class or all classes both semesters or something else?
This is not to say the instructor does not have a good point although details might provide for better insight as to actual costs for the university. And believe me, I am a firm believer in academic bloat and particularly administrative bloat in all of our universities both public and private, although admittedly my background was in the public universities.
But regardless, (Ash) made an excellent comment: “This is dangerous as it will only add fuel to the fire. If cuts do come, they are likely to come in the form of faculty reductions and not administration. I hear where he is coming from, but when is the last time that cuts in particular areas were specific and mandated? Without such specificity, the administration will continue to be bloated but faculty will shrink and classroom size will increase dramatically — not exactly what the author of this has in mind…”
Ash- you beat me to it! I agree!
Comment by Federalist Friday, Feb 20, 15 @ 2:05 pm
John
Thanks for the reply. Didn’t know that. That is amazing and disheartening. Hard to believe that a 1 mil grant to research x only results in 42% to fight x.
Comment by Mason born Friday, Feb 20, 15 @ 2:05 pm
Also, I agree with Stuff Happens. There’s an incredible amount of bureaucracy checking in on every little thing that happens.
Comment by TooManyJens Friday, Feb 20, 15 @ 2:05 pm
One of the reasons for the increase in administration is the competitive nature of higher education, and the increasing focus on non-academic divisions to set universities apart. More and more money is being put into facilities and student affairs to either set themselves apart or improve on buildings that were predominantly built in the mid-20th Century. Students are caring less about the value of the degree and more about the experience.
Comment by NIU Grad Friday, Feb 20, 15 @ 2:06 pm
===Are the teachers pension costs factored into his calculations?
Those are paid by state taxpayers.==
Assuming the state makes its payment, *some* of the pension costs are made by taxpayers. The rest (which is definitely paid) is taken from the employees’ salary.
Comment by Stuff Happens Friday, Feb 20, 15 @ 2:06 pm
===Are the teachers pension costs factored into his calculations?== *Those are paid by state taxpayers.*
University faculty and staff pay from 7% to 8.5% as an employee pension contribution.
Comment by OldIllini Friday, Feb 20, 15 @ 2:07 pm
I’m guessing that a lot of of grant administrative overhead goes to finance more grant writing. Kind of like direct mail and political fundraising.
Comment by Wordslinger Friday, Feb 20, 15 @ 2:07 pm
===It was more an exercise in napkin math.===
But still a pretty good overview of the some of the issues that every college is dealing with. Thanks for sharing it.
You mention you teach 125 students. Is that in once class or is that several classes? I ask because class sizes vary and it’s difficult to compare the cost of teaching 125 students with a non-tenure track faculty member with a smaller upper level course of say, 10 students, taught by a tenured professor. It costs more to educate computer science students than it does to teach political science students too, yet in most cases, the students are paying the same tuition and adjunct faculty are paid similarly.
Fine arts students are among the most expensive to teach because class size is small and the facilities costs for studios and performance space are huge.
It’s a complicated financial puzzle and universities have shot themselves in the foot because they are the cost of instruction is not necessarily reflected in tuition and the lack of transparency only fuels suspicion about true costs and motives.
You mentioned the dual mission of teaching and research. A wise man once said you can’t have a mission unless you have a market. A lot of overhead costs go into making sure the university is attractive to students and sustainable long-term.
Comment by 47th Ward Friday, Feb 20, 15 @ 2:08 pm
OldIllini = So for a $100K research grant, the university tacks on $58K, totaling $158K. Thus the university overhead is 58/158 or 37%=
Huh?
How do you get $158k reimbursement from a $100k grant award?
Comment by Qui Tam Friday, Feb 20, 15 @ 2:08 pm
Adjunct college professors need to unionize if they haven’t already. The Universities aren’t going to pay adjuncts more out of the goodness of their heart.
Comment by Joe M Friday, Feb 20, 15 @ 2:11 pm
While the increase in the funds spent on administration bears investigation, it would be incorrect to automatically assume this is waste. To do that, you have to look at the numbers to see what has caused the change. For instance, in 1999, computers and technology were not nearly as integrated into the classroom as today. If a large part of the increase in administrators is due to an increase in computer personnel, that is not necessarily a bad thing for the education experience.
Comment by Pelonski Friday, Feb 20, 15 @ 2:11 pm
When I taught at UIS, one did not see that bureaucracy in the departments where one was lucky to find a single support staff person for an entire department…and their responsibilities had changed so that they were no longer able to provide much support. Rather, the growth was in Assistants to Deans and Assistant Chancellors etc. whose purposes were unclear or unnecessary. Bambenek is totally on point.
Comment by D.P.Gumby Friday, Feb 20, 15 @ 2:11 pm
I want to re-up what shanks said at 1:58 pm-
Athletic departments are a big part of this bureaucracy. Unless the school is a traditional powerhouse, athletic costs regularly exceed the revenue they bring in. These expenditures are also sacred cows to boosters, so they’re last in line to be cut, even after administrators.
Instead, schools will expand their athletic programs in the improbably hope of increasing their revenue. Look at DePaul; $70 million on a basketball stadium when they’ve raised tuition each of the last few years. It’s bad business, worse education, and certainly not in line with the religious tenets they espouse. Everything’s warped.
Comment by tikkunolam Friday, Feb 20, 15 @ 2:12 pm
I also feel like Mr. Bambenek isn’t looking at the big picture here when it comes to teaching. Is he saying that a small, targeted class with only ten students is going to pay its teacher a lot less?
Not all classes have 125 students, so the larger classes end up subsidizing the smaller classes. According to collegedata.com, only 10% of UIUC classes have > 100 students. 13% have only 2-9 students.
http://hort.li/1EfU
Comment by Stuff Happens Friday, Feb 20, 15 @ 2:14 pm
==But regardless, (Ash) made an excellent comment==
Rich had a better response:
==Facts ain’t dangerous.==
Comment by Anonymoiis Friday, Feb 20, 15 @ 2:14 pm
WRONG. The 58% facilities and administration rate is meticulously justified, negotiated and approved by the Feds. (Harvard’s is over 70%.)
That record-keeping, analysis, negotiation and audit all take people/computers lots of time and effort.
Purchasing now is an ordeal. The corruption of Blago and his cronies was dealt with by an ethics and procurement re-write that makes it a very, very long and tedious process to purchase anything.
Lots of mandatory reporting/training, for ethics, lobbying, outside interest, etc.
I’m sure there are efficiencies to be achieved in UI Admin, but to throw out the misleading and sometimes factually wrong info you’ve spouted, is very poor scholarship.
PLEASE everyone, find out the facts for yourself. Not through JB’s twisted diatribe.
Comment by Blaz Friday, Feb 20, 15 @ 2:18 pm
When I was an undergrad at ISU, we had chalkboards in the classrooms at Schroeder Hall. Today they have smart boards, and wi-fi, and emergency alert message boards, and all sorts of hi-tech teaching gear in almost every classroom.
That stuff costs money. And if you don’t have that stuff, good luck recruiting students and even faculty.
Comment by 47th Ward Friday, Feb 20, 15 @ 2:19 pm
==Facts ain’t dangerous.==
Not alone, but in the wrong hands with the wrong motivations… this is Illinois politics we are talking about. When have facts been of the highest priority?
Comment by ash Friday, Feb 20, 15 @ 2:20 pm
==for unitemized “overhead charges”. So a large majority of research dollars are spent on things other than direct costs of actually doing the research the institution was paid to do.==
Much of those overhead charges go towards paying towards the buildings, labs, lab equipment, computers, support staff, graduate students that contribute towards a research project. It takes all of those things the university provides for the research to take place.
Is there money left over? I don’t know. But it is not accurate to say that all of that overhead goes towards something other than the research the grant is for.
Comment by Joe M Friday, Feb 20, 15 @ 2:20 pm
I know there has been a lot of changes at ISU. The place is completely different from when I was there and that was less than 15 years ago. A lot of the upgrades were needed and I imagine very expensive. I do however question some. Like the big new student gym. I hope that the gym was/is financed through private donation and membership fees. If I not I question what was wrong with our dingy dorm gyms that were presumably bought and paid for.
I only state this because I received multiple fundraising calls about the gym. I figured it may be some student organization separate from the university calling. But they did accept donations to university related programs, like scholarship programs. It seemed to me like their priorities were out of whack. I get it, the gym may help attract certain students, but I have never received a fundraising call that leads with a scholarship program and that seems wrong to me.
Comment by Lil Squeezy Friday, Feb 20, 15 @ 2:21 pm
Interesting that some people still say the pension costs are paid by the taxpayers; that has been brainwashed into their heads. We pay into the pensions, the state rarely pays their share. The massive pension cost now are the result of the state not funding the pensions and allowing the money to compound interest; had they done so, the pension would be funded properly. It is quite sustainable if the would have just funded it. Some blame the unions; but the unions sued the state years ago to make the state fund the system as it should but the ISC said they cannot force them to fund it, merely make them obligated to pay it. The blame falls on the politicians the past 40 years. Can we name a politician who has been in office 40 years (hint: MJM) who has been a part of the underfunding? Yet the voters keep voting him back in, so the voters need to pay the piper back for all those projects that got paid with the pension money that required no tax increases as a result of using that money.
Comment by Crispy Critter Friday, Feb 20, 15 @ 2:21 pm
At what point does the scale tip? Folks need diplomas in order to secure jobs but the costs of borrowing to pay tuition is going thru the roof. Student loan forgiveness is a hot topic right now but there is little room in budgets to pay for that - and little room in some folks hearts to pay for outrageous student loans taken out to pay for degrees in art history and the like.
And now this. It is likely this is happening at most campuses especially since the money is easily procured. Wow - when does this bubble burst? Some predict a collapse that makes the .com era failure look like a hiccup.
Comment by dupage dan Friday, Feb 20, 15 @ 2:22 pm
So the Uni’s need six-figured administrators, and damn more of them, to develop strategic plans describing how to deliver on their core missions. They are essential and can’t be cut. In fact, more are now needed in order to assess the proper strategy for managing reduced resources in a changing environment. In fact, a few contracts may be in order solicit the wisdom of the best of the best who can best advise on such precarious situations. Who you gonna call?
Comment by not so simple Friday, Feb 20, 15 @ 2:23 pm
Blaz
You work for an institute of higher learning…
Comment by OneMan Friday, Feb 20, 15 @ 2:23 pm
Also, there are entirely new fields of study today that didn’t exist when I was an undergrad. Genetics and nano-technology are two that come to mind. You could add women and gender studies too, for that matter, because they didn’t have their own departments or majors when I was in school (and it wasn’t that long ago either). Just the cost of a university library is staggering.
The trade offs that come with cuts generally result in lower quality education. That’s not to say more can’t be done to make college affordable, but it’s been the cuts in state appropriations over the past decade that have really been the driver of tuition inflation, especially in Illinois, where public tuition has gone up much higher percentage wise than private tuition.
That’s another non-dangerous fact to remember.
Comment by 47th Ward Friday, Feb 20, 15 @ 2:25 pm
Crispy Critter,
I am on your side in the whole pension debate, but taxpayers will contribute $7.6 billion to the systems this year. Sure its because of past actions, but suggesting that taxpayers don’t pay in isn’t going to help you win any arguments.
Comment by Lil Squeezy Friday, Feb 20, 15 @ 2:26 pm
And just to confirm…that 58.6% is on TOP of the direct costs in the research award. So, no, not just 42% is going to the research. Aargh.
Many funding sources will not pay the F&A. Foundations don’t usually pay it, the State of Illinois refuses to pay it. Well, there are darn lot of buildings on campus, they have to be maintained and heated, etc. Those are facilities cost. You can’t do 21st century research in antiquated facilties. And God knows the State hasn’t poneyed up any money for building mtce in a long time.
Comment by Blaz Friday, Feb 20, 15 @ 2:26 pm
@Blaz has it right.
Not to mention how much more actual equipment costs because of all of the reporting and tracking.
For example, one group in a college needs to buy a $3000 piece of hardware for a grant. They put together a proposal and submit it. Another group needs to buy the same hardware for a different grant, so they submit a proposal and submit it.
The first one gets approved, but the second fails because they’re ’stringing’ orders to avoid putting it out to bid. Nevermind that the two projects are unrelated.
So now the second project, running out of time, finds another vendor for $1000 more and submits that. It’s approved because it’s a different vendor. Or they go to an approved vendor and say ‘Hey, I need this exact hardware, can you buy it from the person I originally wanted it from and re-sell it to me for $1000 more?’
A little over-simplified, but you get the picture…
Comment by Stuff Happens Friday, Feb 20, 15 @ 2:26 pm
Re: my class.
I teach only in the Springs… its now a lecture/lab setup where I lecture/demo in the big room and they have a dedicated lab with 6 “lab sections”. It’s an upper-level class (CS 460).
My salary is 12.8k or so for the semester. My staff budget is 15k though I doubt I’ll get close to it.
And, in fairness, the math in reality is much messier. Pay shouldn’t necessarily be based on the number of seats in a class. There is something to be said for small classes. Like I said, napkin math.
Comment by John Bambenek Friday, Feb 20, 15 @ 2:29 pm
Higher education is being lampooned in unfair ways, I would argue. Universities have had to make huge investments in IT. They need computer and tech support. There are compliance issues for external grants, for accreditation, and for purchases. In fact, these demands for compliance, and the need for a bureaucracy to ensure compliance (e.g. on purchases and bids) are forced upon the universities by the state and federal government. Can you blame universities for having a bureaucracy when the state says they need to have a bureaucracy to comply with state requirements?
Universities are very complex places. They are not single-mission entities or factories where they spew out uniform cogs as the final product. I’m not saying efficiencies can’t be found. But it is really troubling to think that institutions of higher education in Illinois are the problem here. The University of Illinois is a world class public institution of higher education. It has departments that are ranked higher than departments in the ivy league universities the Governor attended. The court of public opinion here is treating it like it is some fly-by-night diploma mill. Don’t allow misguided rhetoric to undermine something many other states only dream about - having a world-renowned PUBLIC institution of higher education.
Comment by Scamp640 Friday, Feb 20, 15 @ 2:30 pm
Bloated administrations makes a wonderful target
and a great story, but it’s just a small part of
the problem facing higher education in the US.
http://www.amazon.com/College-What-Was-Is-Should/dp/0691130736
Reduced teaching loads,departments where the bulk
of the protected and tenured are over 80, students who spend less than half the time on
out of classroom preparation than they did 30
years ago and expect better outcomes. Andrew Delbanco nailed this one and is worth a read.
Comment by Illinoisvoter Friday, Feb 20, 15 @ 2:30 pm
“Those in change, feed themselves well.” J.R.L. 1979
Comment by Rufus Friday, Feb 20, 15 @ 2:31 pm
As to the 58%, while this seems high, and I have questioned it a number of times, please remember that is includes all infrastructure costs, which is a non-trivial amount.
Comment by Rufus Friday, Feb 20, 15 @ 2:35 pm
This is the best commentary I’ve seen in a long time. I’m an adjunct and I do it for the love, not the money (which is peanuts). But the grossly top-heavy administration sucks all the passion for teaching out of me. Good teachers want to teach more but the costs of our administrators are making that impossible.
Comment by Nicholas Friday, Feb 20, 15 @ 2:36 pm
58% for indirect costs with grants is a fairly standard negotiated rate with the federal government for many of the research grants it gives out.
http://researchadmin.uchicago.edu/preparing/budget_development/FB_Federal_rate_agreement_2014_01_08_revised.pdf
shows such an agreement the University of Chicago has.
Comment by Joe M Friday, Feb 20, 15 @ 2:40 pm
Universities compete because students have money either in the form of grants or cheap and easy loans. The best student centers, dorm and food facilities, student groups, sports facilities, recreation centers are all recruiting tools. Long gone are the days of getting a cost effective degree focusing on academics.
Comment by Ret Prof Friday, Feb 20, 15 @ 2:40 pm
This sounds like the magic billions in waste that no one can actually identify.
2 quick points, John didnt govenus numbers for his or the hraders salaries. Do any of these filks get benefits? Heath insruance, retirment, parking…. Those costs meed added into the mix. Next the article would be more useful if he pointed to actual positions that ate not needed as opposed to the mythical beuracracy. So who needs to be cut? The janitors? Campus security? Campus fore? Campus health? The road funds for campus driveways? Bldg maintanence funds? The statement that these costs are covered is also mot supported. If they charge each student a 50 dollar tech fee, but the it infrastructure costs 300 per student, the extra needs to come from somewhere. The maintainence on the farms, the cet school, the software licenses; quad maintanence. That campus is huge. So instead of a few misleading numbers why not do some real research on the schools spending and john can say which people can be let go wothout impacying operations because they provode no benefit or function to the school. Havent we demagogued the mythical beuracracy enough? Just point to the positions and the savings instead of this smoke and mirror aregument about mythical waste.
Comment by Ghost Friday, Feb 20, 15 @ 2:41 pm
Scamp 640 is right. Universities are highly regulated institutions. Federal requirements for everything from grant compliance to sexual assault investigation procedures to animal welfare law to laboratory safety standards cost money. Overhead is required, for direct costs, auditors (required), etc.
And then there are central costs, like the police department, health (and mental health) services, IT, facilities, etc.
It’s not just an English professor, a classroom, and an office anymore.
Comment by Anonymous Friday, Feb 20, 15 @ 2:41 pm
And yes, I do understand how mandates/regulation have lead to this problem as well and it’s not like you can cut the budget to 0 and pretend those rules still don’t exist.
Comment by John Bambenek Friday, Feb 20, 15 @ 2:43 pm
From today’s “Budget addresses” blog:
= jerry 101 - Friday, Feb 20, 15 @ 12:31 pm:
Just as a quick note, in FY 2014, the University of Colorado system (3 campuses, I think, strangely abbreviated CU) received general state appropriations totalling $13.7 million, state capital contributions totalling $0 and state and local grants and contract revenue totalling $40 million. The state does NOT cover CU’s pension or health care costs.
Overall, U of Colorado is about 3/4ths the size of U of Illinois - CU has total assets of $5.6 billion. UI has $7.4 billion in total assets.
2014 state support for U of I (and this doesn’t even include MAP awards): General state appropriations: $668 million. On behalf payments for pension and health care: $1.1 billion; Capital appropriations: 11 million; State grants and contracts: $86 million.
According to College Navigator, UIUC’s total tuition and fees for 2013-2014 academic year was about $29k (living on campus). CU-Boulder’s total in state tuition and fees for the same period? $29k =
“The answer lies in the fact that while the number of students has remained generally flat or grown slightly, the growth in the number of non-teaching administrators has skyrocketed. In the last 25 years, the number of administrators has doubled”
It is my assumption that this is a problem in almost every single department the IL government runs, and it has gotten worse and worse and worse over the last 20 years.
Everyone on here who keeps talking about the costs of equipment, overhead, administrators being necessary, blah, blah, blah - take a look at jerry 101’s statement in today’s CF “budget address” blog. Now, explain to me how Colorado can do it without these massive state payments, and we can’t. Are they still using chalkboards? Do they not also need administration? If there is a reasonable basis for the difference, please explain.
Comment by Kodachrome Friday, Feb 20, 15 @ 2:43 pm
27k to teach one course (13% of 207k)? Try a community college, where you get about 1/10 of that. And with no T/A to do the grading.
Comment by envelop Friday, Feb 20, 15 @ 2:55 pm
http://illinois.edu/lb/article/72/90240/page=1/list=list
Article showing the long-term value of a great University to the State’s economic health
Comment by Blaz Friday, Feb 20, 15 @ 2:55 pm
I do not know enough about the subject to be able to discuss it intelligently, but it would be nice to see a comparison with other states. I do know enough about budgets and finances for large institutions, academic and otherwise, to know that it can be incredibly complicated stuff. If Illinois is an outlier, that is one thing. If Illinois is pretty much the same as every other state, then it is less interesting. When the author says he gets a larger percentage when he teaches “overseas,” he notably doesn’t say whether this is France or Japan or India or Timbuktu. I think that’s relevant
Until we have more context, it is difficult to draw any meaningful conclusions.
Comment by Apples and Oranges Friday, Feb 20, 15 @ 2:57 pm
===Now, explain to me how Colorado can do it without these massive state payments, and we can’t.===
Here’s one way: 37% of the University of Colorado Boulder students come from out of state, and are charged $31,000 for tuition (compared to $9,000 for in-state students. Only 7% of the student at UIUC come from out of state.
http://www.collegexpress.com/lists/list/percentage-of-out-of-state-students-at-public-universities/360/
Comment by 47th Ward Friday, Feb 20, 15 @ 2:58 pm
envelop, I make $12.8, my staff budget is $15k and yes, I know the pay at a community college is much lower.
Comment by John Bambenek Friday, Feb 20, 15 @ 3:01 pm
Good job John, for a quick look.
It is very difficult for anyone in a complex organization to see where they can save money, given their own justifications for spending it in the first place. Everything seems “essential” or at least surely needed, from the inside.
From the bits and pieces I have seen, there are significantly more costs to be rationally cut from local governments and the public education establishment in Illinois, than has been available at the state government in recent years. Local mayors and education administrators have loved to complain about waste at the state level, but have not cut operations as severely as the state already has.
From that perspective, Rauner’s focus on cutting support in those two areas is a welcome eye-opener.
Comment by walker Friday, Feb 20, 15 @ 3:04 pm
There is no business model that I am aware of that would support at 70% - 90% overhead cost. That is absurd.
Comment by Ahoy! Friday, Feb 20, 15 @ 3:06 pm
Interestingly, no one has focused on all the burgeoning state requirements, most notably in procurement and grants that now have to deal with State bureaucrats on a daily basis, providing no value. The same bureaucrats who, and I quote “don’t care about the mission educating students”.
Comment by Anon Friday, Feb 20, 15 @ 3:08 pm
“Then we have people monitoring every purchase to make sure approved vendors are used, orders aren’t being strung together, etc.
Just let me do my job and I’ll get a lot more done, and then we won’t need all of these people watching me.” Yup. That’s the dark side of the “We need to account for every penny to make sure it’s spent wisely, transparently and make sure there’s absolutely no fraud” philosophy. Seems like you can either spend the money on accountants and auditors, or you can lose some to “waste, fraud and abuse.” (or both) Just one more way government is not like business.
Comment by Skeptic Friday, Feb 20, 15 @ 3:09 pm
Research grant thing…
Ok this is going to sound terrible in large part because it is…
But, I got a great CS education at NIU and you can’t toss a dead computer without hitting a NIU CS graduate somewhere in Chicago, but they didn’t have a big research spend in CS…
A quality undergraduate education does not require a research school…
Comment by OneMan Friday, Feb 20, 15 @ 3:11 pm
Other responses from the budget address thread:
- Anonymous - Friday, Feb 20, 15 @ 2:35 pm:
“Just as a quick note, in FY 2014, the University of Colorado system (3 campuses, I think, strangely abbreviated CU) received general state appropriations totalling $13.7 million, state capital contributions totalling $0 and state and local grants and contract revenue totalling $40 million. The state does NOT cover CU’s pension or health care costs.”
University employees in Colorado are state of Colorado public employees and are paid directly by the state and not out of an appropriation given to the Universities. Their pensions are also matched directly at the state level. Different than UI which pays salaries for state employees from the appropriation provided by the State.
- Ghost - Friday, Feb 20, 15 @ 2:53 pm:
Cu received state money of 181.5 million and another 580 million in state and federal grants. So the prior numbers are just made up
http://www.cu.edu/sites/default/files/FY15_Operating_Budget.pdf
The cu operating budget for fy2014 all sources was 3.2billion and they are mo u of i which also has national computing facilities and massive farms
- Ghost - Friday, Feb 20, 15 @ 2:59 pm:
I found Jerry’s 13.7 million number. That is the amount of financial aid covered by the state that was paid to CU for higher education. It is not the states funding for CU which was hundreds of millions in grants and direct support.
Comment by Nobody of consequence Friday, Feb 20, 15 @ 3:11 pm
One factor not mentioned is that colleges have to compete for students. As a result, they build nicer dorms and rec centers. Rauner as a businessman should understand if you don’t have a good product, people won’t buy it.
A friend who works at a big university said that the cost of mental health and other support services to students is huge.
Comment by Chicago guy Friday, Feb 20, 15 @ 3:13 pm
Again, I have no knowledge whether the comparative numbers are accurate or not. Blaz, I agree, but cuts have to come from somewhere - is it the disabled and the orphans, or is it some reduction in the U of I’s standing in. Someone in the other blog noted US News ranked U of I 44 and U of Colo 88 in the nation. Given our current circumstances, and the fact U of I is not in the top 10 or 20, I think we should be more than willing to have this be a sacred cow that can be impacted with cuts. My guess is there isn’t much difference between 44 and 88 in terms of the ability of students to obtain reasonably good employment after graduation. Somethings gotta give . . . .
If those comparative numbers are off, or we are not much different from comparable universities (see Apples and Oranges), its a whole different story
Comment by Kodachrome Friday, Feb 20, 15 @ 3:13 pm
- Rich Miller - Friday, Feb 20, 15 @ 1:46 pm:
“===Are the teachers pension costs factored into his calculations?==
Those are paid by state taxpayers.”
No, they are not paid by the taxpayer. The grant is assessed for the teacher’s salary and ALL benefits. This is part of the 58% overhead. Benefits are assessed to the grant at 30=%
Comment by Anonymous Friday, Feb 20, 15 @ 3:14 pm
Health services are its own fee, I assume (and that is an assumption) is that it’s self-sustaining.
Dorms are also its own individual line-item cost. If you don’t stay in dorms, you don’t pay the fee. So I also assume University Housing is self-supporting.
I, of course, could be wrong on that.
Comment by John Bambenek Friday, Feb 20, 15 @ 3:16 pm
A good article about adjuncts: “Class divide on campus: Adjunct professors fight for better pay, benefits”
http://usnews.nbcnews.com/_news/2014/01/20/22326956-class-divide-on-campus-adjunct-professors-fight-for-better-pay-benefits
Comment by Joe M Friday, Feb 20, 15 @ 3:17 pm
===No, they are not paid by the taxpayer===
Yes, they are. The state picks up the employer’s portion.
Comment by Rich Miller Friday, Feb 20, 15 @ 3:18 pm
Would you calculate your pay at around $200 per classroom hour?
Comment by anon Friday, Feb 20, 15 @ 3:21 pm
The state does not pick up the employer match portion for professors and researchers paid through a grant. The employee pays 8% and the grant picks up the state portion. The grant also is assessed for health insurance benefits, life insurance, and all other benefits the state would otherwise pick up for those paid from appropriated funds.
Comment by Anonymous Friday, Feb 20, 15 @ 3:21 pm
And let’s consider this factor for econ and marketing profs—-many give talks to corporations and do consulting work. They are paid VERY well for that work in addition to collecting a nice salary and benefits from the state.
Comment by anon Friday, Feb 20, 15 @ 3:23 pm
Faculty are not the only persons providing direct student instruction/support, so I’d always advocate for a distinction between direct service and purely administrative personnel. As some have noted, there are needs for support staff and other non-instructional personnel to support the teaching endeavour (otherwise, faculty are going to have to resume doing a lot of the non-classroom academic work they did historically but have become more specialized).
I for one do question the dual (and competing) missions of research and instruction. I understand their linkage, but it seems that we have spent too much $$ on ‘faculty’ who actually don’t teach. Perhaps we should be thinking about this model in general (university research parks for “researchers” and real universities for instruction).
That said, now is not the time in this argument for that debate, for it would only serve to divide those of us who believe the Governor’s attack on higher education is problematic.
Comment by xxtofer Friday, Feb 20, 15 @ 3:25 pm
@rich - I think that used to be the case, but that cost was passed on to the universities ago. I could be wrong, but I do see a university deduction for pensions on my pay that shows both my contribution and the amount that the university paid toward the system.
Comment by ash Friday, Feb 20, 15 @ 3:30 pm
State Funding: A Race to the Bottom
by Thomas G. Mortenson, Winter 2012
“Colorado has reduced its support for higher education by nearly 69.4 percent, from $10.52 in fiscal 1980 (and a peak of $13.85 in fiscal 1971) to $3.22 by fiscal 2011. At this rate of decline Colorado appropriations will reach zero in 2022, 11 years from now. Projections using more recent data find that Colorado could hit zero as soon as 2019.” - http://www.acenet.edu/the-presidency/columns-and-features/Pages/state-funding-a-race-to-the-bottom.aspx
Comment by PrairieFire Friday, Feb 20, 15 @ 3:30 pm
===I think that used to be the case===
Well, you’re wrong. Sheesh. Look it up for crying out loud.
Comment by Rich Miller Friday, Feb 20, 15 @ 3:35 pm
OneMan:
I keep wondering who’s been hitting me with those dead computers.
Comment by elginkevin Friday, Feb 20, 15 @ 3:36 pm
According to data from the U.S. Department of Education, the University of Illinois at Champaign-Urbana has the 8th highest in-state tuition of any four year public university in the country. The website lists UIUCs tuition at 14,522, compared to a national average for 4-year public universities of $7,407. (UIUC actually charges considerably higher tuition than the listed figure here for in-state science and engineering students–slightly more than $21,000 per year).
http://collegecost.ed.gov/catc/Default.aspx#
Comment by Quiet Sage Friday, Feb 20, 15 @ 3:38 pm
Well, you’re wrong. Sheesh. Look it up for crying out loud.
“Well, you’re wrong. Sheesh. Look it up for crying out loud.”
No, he is not.
Comment by Anonymous Friday, Feb 20, 15 @ 3:41 pm
Most universities promote at least three missions; Teaching, Research and Service. Most of what many of you call administrators are really service providers. Universities, like most state governments , provide a wide variety of services to many different constituency groups. Trying to run one from the bleachers is foolish and impossible as demonstrated through this discussion.
Comment by Makandadawg Friday, Feb 20, 15 @ 3:43 pm
Why did you remove my post that was a cut and past from the UI website that cleary states that grants are assesed from the employer match for retirement and the cost of all other benefits? Especially after you told Ash to look it up? Sheesh.
Comment by Anonymous Friday, Feb 20, 15 @ 3:44 pm
And tuition is higher in the business school at UIUC.
Look, quit making students who want a business degree and business career take classes like art history or 15th century lit so they will be “well rounded.” Complete BS.
Makes kids stay in school for 4-5 years so the schools can rake in money!
Comment by anon Friday, Feb 20, 15 @ 3:44 pm
==Only 7% of the student at UIUC come from out of state==
Those numbers look old. UIUC currently shows their enrollment as 36% from out of state. 14999 out of 41497 students are from outside Illinois.
http://dmi.illinois.edu/stuenr/abstracts/SP15_ten.htm
Comment by Formerly Known As... Friday, Feb 20, 15 @ 3:45 pm
uofi is completely nontransparent when it comes to tuition rates–they don’t charge by the credit hour so they can charge higher rates–I guarantee you this guy is totally underestimating the cost of a three hour credit course…much closer to $2400-$3,000 for three hours
Comment by anon Friday, Feb 20, 15 @ 3:46 pm
===Makes kids stay in school for 4-5 years so the schools can rake in money!===
No, what makes kids stay in school beyond four years is changing majors thus paying for courses that won’t count to your degree. If you can’t pass calculus, you can’t major in accounting or finance (or any of the science fields). You should find that out sooner rather than later in your academic career.
My fraternity was filled with guys who started out as Finance majors only to end up with Econ degrees. They had a lot of fun along the way, but college is too expensive to be on the 5 year plan anymore.
Comment by 47th Ward Friday, Feb 20, 15 @ 3:52 pm
I really doubt 1 out of 3 students who go to UIUC are from outside illinois.
Comment by anon Friday, Feb 20, 15 @ 3:52 pm
There is no greater return on investment than investing in higher education. Radical cuts of hundreds of millions of dollars will severely damage the ability of Illinois public universities to fulfill their mission of education and research.
Overhead costs are additional costs: the cost to keep the lights on, the cost of asset depreciation, the costs of groundskeeping, the cost of electrical work, building engineers, etc., etc. All of those costs are negotiated with the federal government for grants given through federal agencies. 58% is not bad. Other institutions charge far more. Many private grant-making foundations and corporations refuse to fund overhead or indirect costs, which often puts providers in the precarious position of deciding whether they can keep the lights on or try to provide the service they originally wanted to provide.
Reducing funding to higher education means tuition rates will increase much, much faster. Fewer people will be able to make the sacrifice and afford to attend college. Fewer college-educated workers means a less educated, less attractive workforce for employers. And Illinois loses. Fortune 500 companies come to Illinois because of location and because we have thousands of college graduates and some of the best universities in the country.
Radically slashing funding to achieve a short-term narrow spending goal will seriously hurt the future economic viability of the state of Illinois.
Comment by PrairieFire Friday, Feb 20, 15 @ 3:52 pm
===uofi is completely nontransparent when it comes to tuition rates===
So is every other university in the country, and the privates are worse.
Comment by 47th Ward Friday, Feb 20, 15 @ 3:53 pm
@Ash - you are/were correct.
Fringe Benefit Rates
Fringe benefits are the employer contributions for retirement, employee insurance, workers compensation, etc. The University calculates fringe benefit rates which are then charged to sponsored project agreements so that each project (federal and non-federal) pays its fair share of these support costs. Our sponsors recognize the importance of these costs and will reimburse us for fringe benefit costs, expressed as a percentage of total salaries.
The University’s fringe benefit rates consist of multiple rate components as follows: employee health, life, and dental; graduate assistant health, dental, and vision; termination vacation and sick; workers compensation; retirement; OASDI; and Over Seas Worker’s Compensation.
Comment by Anonymous Friday, Feb 20, 15 @ 3:53 pm
Spot on. Many of us already knew this but it is nice to see verification.
- UIUC Alum
Comment by Keyser Soze Friday, Feb 20, 15 @ 4:00 pm
==I’m guessing that a lot of of grant administrative overhead goes to finance more grant writing. Kind of like direct mail and political fundraising. ==
And this does have a return on investment. If a university took, say, 15% of tuition dollars and invested that 15% in fundraising, and its revenue from fundraising activities exceed its costs, its certainly a defensible decision.
Comment by Robert the Bruce Friday, Feb 20, 15 @ 4:02 pm
Are there opportunities to reduce waste and increase efficiency? Yes, there always are. But dangerous, ill-considered cuts like the new governor suggested will not achieve that goal. Schools will have to increase tuition to partially make up for the loss in the short term.
“Since 2002, the University of Illinois has lost about $1 billion in spending authority, leading to tuition hikes and cuts. For example, the university shut down its Institute of Aviation in July 2011.” http://www.wbez.org/news/illinois-truth-tuition-law-helps-families-hurts-schools-experts-say-108167
Boeing is headquartered in Chicago, and they had to cut the aviation program. How does this help make Illinois attractive to employers?
Comment by PrairieFire Friday, Feb 20, 15 @ 4:02 pm
Regarding the federal indirect cost rate included with all NSF, NIH, and other federal grants, it’s really pretty straightforward. The federal government wants the research done but outsources it to universities, who do it better and more cheaply than the feds could do on their own. The biggest factor in the indirect cost rate is the cost of facilities (think laboratories). The feds don’t want to build and operate them, so they pay for universities to build them but the payments are connected only to the grant funding the feds provide. It’s actually a fair and, for the federal government, rather efficient way of procuring important research that benefits the country.
My main objection is most of the federally funded research gets published in privately run academic journals that charge for subscriptions. Why should tax payers pay for the research, then pay again to read the results?
Comment by 47th Ward Friday, Feb 20, 15 @ 4:08 pm
Rich the 3:17 link is making this thread really hazard to read.
Comment by PublicServant Friday, Feb 20, 15 @ 4:09 pm
From SURS on grant funders paying the employer cost: http://www.surs.com/pdfs/employer/Normal%20Cost%20FY%202012.pdf
Comment by thechampaignlife Friday, Feb 20, 15 @ 4:09 pm
The increase in the number of administrators — and their pay — at U of I is criminal. I’ve said it here time and time again.
BUT … Mr. Bambenek is missing something in his analysis. A huge percentage of that research “skim” goes to fund academic programs at the university. It doesn’t all just go into the administrators personal piggy banks. This “skim”, known as Indirect Cost Recovery or ICR at U of I, helps to fund all the academic programs that do not have the means to entirely fund themselves, mostly due to lack of available grant money in those fields. Basically what happens is engineering and the sciences, where there is tons of federal money, end up funding the humanities programs.
Don’t get me wrong: I am not sticking up for or defending the bloated and ridiculously overpaid administration here. If Rauner would give me an hour, I could send him a list of $100 million in cuts that would not touch academics, research, or public service — the three core missions of the U of I. But again, he’s going to cut funding and give the administrators the power to make cuts. And guess what? They don’t cut themselves! But my training in journalism makes me a stickler for accuracy.
Comment by Filmmaker Professor Friday, Feb 20, 15 @ 4:11 pm
==I’m guessing that a lot of of grant administrative overhead goes to finance more grant writing. Kind of like direct mail and political fundraising. ==
No, no, no, no, no. I cannot adequately express how much I disagree with this statement.
It is not a self-perpetuating circle. Being awarded a grant, especially a federal research grant, takes a tremendous amount of work.
The type of grants we are discussing - HHS, NIH, NSF, DoD, DARPA - are written by the research faculty are going to be the principal investigators of the grants. They want to do research, not grant writing. They want to teach and empower the next generation of researchers, not copy-edit and search for typos in grant applications.
Comment by PrairieFire Friday, Feb 20, 15 @ 4:16 pm
==I really doubt 1 out of 3 students who go to UIUC are from outside Illinois==
You think UIUC is lying about that? Why?
Comment by Formerly Known As... Friday, Feb 20, 15 @ 4:17 pm
Good discussion here, and I’ve learned some stuff.
Libraries cost money, a lot of money. As someone else mentioned, dorms and pretty campuses cost money. Athletics cost money (personally, that’s where I’d cut, but that’s just me). Utilities cost money. Computers cost money. And the list goes on. Health care costs money.
The more I think about this, the more I think that the original critique is less than insightful. The answers should be pretty easy to get, though, given that the financial records of public universities aren’t secret.
Comment by Apples and Oranges Friday, Feb 20, 15 @ 4:20 pm
==I really doubt 1 out of 3 students who go to UIUC are from outside Illinois==
Way outside of Illinois - almost 10,000 of those 15,000 out of state students are international students.
Comment by Anonymous Friday, Feb 20, 15 @ 4:20 pm
FKA, I think the difference might be between out of state v. in-state undergraduates as opposed to grad students. I couldn’t tell how my source handled that, but I was under the impression that the 7% number was referring to undergraduates at UIUC. It’s easy to guess that if you look at grad students, the number of out of state students would be much higher.
Comment by 47th Ward Friday, Feb 20, 15 @ 4:23 pm
And from yesterday
==About 71 percent of this year’s freshman class is from Illinois, down from nearly 90 percent a decade ago.==
http://www.rrstar.com/article/20150219/News/150219315
Comment by Formerly Known As... Friday, Feb 20, 15 @ 4:25 pm
“Much of those overhead charges go towards paying towards the buildings, labs, lab equipment, computers, support staff, graduate students that contribute towards a research project.”
That was was not the case in the past. It has been many years since I was there but indirect costs were always a big number, 40% or so, of proposals to Federal Agencies. All of the indirect cost money went into the bowels of the university to pay for things like janitor service, light bulb changers, utilities, etc. None of it was available for paying for the research involved. That was 50-60 years ago but I doubt if things have changed.
Comment by CapnCrunch Friday, Feb 20, 15 @ 4:26 pm
Great discussion. One other part of this (only a part), but is: re infrastructure and overhead, remember all universities now are competing for the students who can actually pay the sticker price tuition (tuition at university now is kind of like your doctor’s bill, it is whatever you can negotiate).
The students who can pay the full freight not surprisingly come from well-off families who aren’t that sensitive to the tuition price … but they -are- very sensitive to the amenities. They want single rooms, snaazy gyms, cool cultural amenities, the works. Louisiana State University is debating building an on-campus lazy river.
All that drives up tuitions, but I see why the universities feel like they need to do it … if they DON’T attract enough of the “golden ticket” students, with state funding typically on the decline, they don’t pull in enough revenues to help at least partially subsidize the scholarship kids.
I do wonder ultimately if market forces (mainly the failure of the median American family’s income to go up) is going to break this apart … universities’ infrastructure-arms-race to cater to and attract the wealthiest students is going to drive away the median student, to the point where the economic model no longer works. Maybe community colleges will be the ultimate winner here, or even (shudder) online education.
But that’s just part of the issue, too, mandates and regulations and growth of administration is related to the above but its own separate cost-beast.
Comment by ZC Friday, Feb 20, 15 @ 4:27 pm
Formerly Known As 4:25 pm, another strategy as Rich has covered is to import students from overseas (China above all) willing to pay the full sticker price, in effect using them to cross-subsidize the in-state kids.
Comment by ZC Friday, Feb 20, 15 @ 4:28 pm
@47th Ward - good point. That does make a difference. 7848 of 30948 undergrads are from out of state, about 25%.
Comment by Formerly Known As... Friday, Feb 20, 15 @ 4:30 pm
Oh my. I subscribed to followup comments and now I get an error message about an invalid key when I try to turn it off.
Over the next few days I will learn how high Gmail’s thread counter can go, I think!
Comment by elginkevin Friday, Feb 20, 15 @ 4:30 pm
===Athletics cost money (personally, that’s where I’d cut, but that’s just me).===
You might be surprised about that. Yes, they cost big money, but the bigger programs generate a lot of money too. Most big-time athletics programs either break even or make a little money, especially when you consider alumni affinity and support. Lots of people wear U of I athletic gear but will never set foot on campus. Well, at a game maybe, but not necessarily in a classroom.
The Big Ten schools get a lot of revenue from the conference. Southern, Western and ISU probably lose money for their schools overall, but I’ll bet there isn’t a whole lot of real dollars saved. Some people point to the cost of athletic scholarships, but guess what, if that volleyball player wasn’t recruited to play on the team, odds are she wouldn’t have enrolled in that school in the first place so you’d never get her tuition money.
Athletics are expensive and they aren’t right for every school, but ending inter-collegiate athletics isn’t going to solve the under-funding problem or lower anyone’s tuition.
Comment by 47th Ward Friday, Feb 20, 15 @ 4:30 pm
Per the UIUC website, total students—-44,520 of which 14% are international. 14% = 6232
Comment by anon Friday, Feb 20, 15 @ 4:31 pm
Administration has gone crazy at U of I. My son had a 10 cent charge on his account for printing. I asked if I should wait until the next bill to pay this, and I was told that there would be a $5 or $10 late charge if it wasn’t paid when due. I wonder how much it cost the Big U to collect and process that 10 cent charge.
Comment by Illinilaw Friday, Feb 20, 15 @ 4:37 pm
“Per the UIUC website, total students—-44,520 of which 14% are international. 14% = 6232″
Not according to the 4th tab from… http://dmi.illinois.edu/stuenr/abstracts/fa14_ten4.htm
Comment by Anonymous Friday, Feb 20, 15 @ 4:38 pm
A&O - only thing I would say is, the whole blog started, not criticizing library, utility, health care, etc. costs, but rather mainly the increase in bureaucratic, non-teaching administrators - and John B used the term “skyrocketing”. That would seem to be the place to target, not faculty or facilities, but I’m not sure how you would require that. Plus, am I wrong in assuming that many of these “administrators” have friends in the GA? . . . . .
Comment by Kodachrome Friday, Feb 20, 15 @ 4:38 pm
@rich — just looked at my pay stub to make sure. There is an employee line and employer line for medicare, health care, dental and SURS. Are they not really paying it?
Comment by ash Friday, Feb 20, 15 @ 4:42 pm
Anon 3:08 pm:
“Interestingly, no one has focused on all the burgeoning state requirements, most notably in procurement and grants that now have to deal with State bureaucrats on a daily basis, providing no value. The same bureaucrats who, and I quote “don’t care about the mission educating students”. ”
Excellent point. One of those requirements is having procurements micromanaged by the Procurement Policy Board.
Comment by Anyone Remember Friday, Feb 20, 15 @ 4:45 pm
I do remember one cost being transfered — was it health care? Does the line they say is employer cost for SURS get billed to or transfered to the state?
Comment by ash Friday, Feb 20, 15 @ 4:46 pm
===One of those requirements is having procurements micromanaged by the Procurement Policy Board.===
I may be misremembering, but I recall several university presidents last year or the year before agreeing to pick up the pension costs for their employees in exchange for becoming exempted from the state procurement act. Anyone else remember the details of that?
Comment by 47th Ward Friday, Feb 20, 15 @ 4:47 pm
ZC - UofI Chicago has a “lazy river” in their rec center.
Comment by Chicago guy Friday, Feb 20, 15 @ 4:50 pm
Ash - the grant picks up all of your benefits. The grant is assessed over 30% of your salary. The University makes payment for your benefits out of this assessment. No bills go to the state for your benefits paid by grants.
Comment by Anonymous Friday, Feb 20, 15 @ 4:52 pm
A bunch of schools in Texas kept building taller and taller climbing walls in their rec centers so they could claim to have the highest climbing wall in Texas. It’s a freaking joke, but the competition to put butts in seats is fierce.
Comment by 47th Ward Friday, Feb 20, 15 @ 4:53 pm
@anonymous — I’m talking about normal salary, not grants. Rich may be right. Does the school pick up the actual health care but transfer the employer payment to SURS to the state? That may be where the confusion is happening. There is definitely am employer line and an amount. Does it actually come from the school?
Comment by ash Friday, Feb 20, 15 @ 5:01 pm
Regardless, the main point of the post was administrative bloat — which was a point that led to big cuts to higher ed before, and it all came from the classroom and bottom ranks, rather than administration.
Comment by ash Friday, Feb 20, 15 @ 5:03 pm
From FY14 UI financial statements: $1,207,537,000 from gifts and grants. $668,372 from State appropriations. Grants and Contracts employees are classifed as admin at UI. Grant and gift admin employees have increased greatly but that is because that is where the revenue is. Grant revenue going up and state approp goind down. Not hard to see why employees have increased.
Comment by Anonymous Friday, Feb 20, 15 @ 5:05 pm
state approp should say 668,372,000
Comment by Anonymous Friday, Feb 20, 15 @ 5:07 pm
Ash - If you are paid from a state fund, the state pays the employer portion of your benefits. Although, the University has paid a portion of the employer health insurance costs for many years. In excess of $24 millioin annually for all employees paid on state funds.
Comment by Anonymous Friday, Feb 20, 15 @ 5:11 pm
John Bambenek,
Thanks for at least responding to some of the questions and issues. Too many people who write up info such as yours run and hide. You did not.
Comment by Federalist Friday, Feb 20, 15 @ 5:22 pm
First, I would like to congratulate John, whose piece above is quite rational and thoughtful, as opposed to some truly odd posts he used to make on here.
Second, I applaud the fact that the University of Illinois Urbana-Champaign is a world class educational institution in some of its departments, and top 25 in the country in many more. Because of that I am fairly tolerant of the high salaries and burgeoning bureaucracy. Research, athletics, marketing (and some nice amenities are part of marketing), facilities.etc are all necessary parts of the whole at a place like UIUC.
I am more troubled by the rest of our public 4 year universities. Presidents there may make double what the Governor of Illinois earns. CFOs may make double what the state’s budget director makes. The Presidents direct reports make more than many of the Governor’s direct reports. In general the administrative salaries are grossly inflated at these institutions compared to the rest of government. I can assure you the job of a President at a regional university isn’t more difficult than the Governor’s.
These places aren’t world class, and they aren’t supposed to be and don’t need to be. They should be very competent educational institutions, with perhaps some regionally significant research capabilities (i.e., coal at SIUC). I understand and endorse the payment of good salaries to instructional staff and outstanding salaries at UIUC but at the regional universities I strongly disagree with paying administrators huge salaries simply because some other institutions are stupid enough to.
Comment by steve schnorf Friday, Feb 20, 15 @ 5:27 pm
Thanks! — sorry, Rich.
Comment by ash Friday, Feb 20, 15 @ 5:30 pm