It is no secret Georgetown has struggled historically with its finances. From fundraising shortfalls for new campus buildings to the hemorrhaging of money by Georgetown University Medical Center, the university’s access to resources needed to push forward new initiatives has been limited. Georgetown is one of only two top-25 schools (according to the most recent U.S. News and World Report college rankings) without a top-25 endowment (the other is Carnegie Mellon University).
Recently, however, Georgetown’s fortunes have changed, and the university is making significant progress toward reaching a healthy financial state. Despite the recession, Georgetown has made the most of its endowment and has retained its position as a top-tier institution. A report published earlier this year by the National Association of College and University Business Officers ranks our endowment as 71st in the country, coming in at $833 million as of December 2008.
Georgetown’s transition has not been easy. It went from being a small, regional college to a prominent national university and an emerging global institution in a matter of decades. Throughout the transition, the university has maintained its Jesuit identity and its core commitment to a comprehensive undergraduate education.
Our location in the nation’s capital gives students access to unparalleled cultural, academic, political and business opportunities and resources, but it also poses challenges for the university. Salaries and benefits in the area must be competitive in order to attract and retain high-quality faculty and staff. Moreover, high real estate costs and geographic constraints limit Georgetown’s growth.
Given the endowment and the university’s positioning, Georgetown has been able to maximize its strengths quite well. This comes at a price, though. In order to compete with our peers, the university has had to force our tuition upward, paralleling the university’s rapid rise. Today, we rank as the second-most expensive school in the country according to a CNN Money ranking, with the annual total cost of attendance at $52,161.
Tuition at this level is unsustainable and will hinder our ability to attract the best pool of candidates to the Hilltop – especially when the median household income in the United States is $52,029. Georgetown’s need-based financial aid policy is in jeopardy since our endowment simply does not allow us to offer competitive financial aid packages to admitted students without a heavy reliance on loans. In recent years, our peers (namely Harvard and Princeton) have introduced policies completely eliminating loans from financial aid packages and pledging to meet 100 percent of a student’s demonstrated need.
Georgetown must strive to provide access to students of all backgrounds. Unfortunately, the sticker shock of our tuition may discourage some students from applying. If the university is committed to diversity in the student body, however, it must re-evaluate the price of a Georgetown education; lowering tuition to a more reasonable level without sacrificing quality may be more challenging, but its benefits would be far-reaching.
Another approach would be to devote more fundraising efforts to financial aid. The university is already making progress on this front. Since July 2004, the Georgetown Scholarship Program has supported over 300 students in achieving their higher education goals by reducing the burden of loans and post-graduate debt. The yield rate among students requesting financial aid is 39 percent at Georgetown; this number increases by 20 points to 59 percent for those students requesting financial aid and receiving a GSP grant. Clearly, the program works.
The GSP is a model to emulate for future success. With the launch of the 1789 Scholarship Imperative to raise $500 million for financial aid during the next capital campaign, the university is demonstrating its continuing dedication to its need-blind admissions and need-based financial aid policies.
Georgetown should complement this endeavor by evaluating its tuition rates as well. Every member of the university community – both past and current – must stick to the commitment to remaining a competitive institution open to all. Thinking again about tuition costs will lead us in the right direction.
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