Macalester continues to perform well financially

By Katie Zager

The new budget for the 2012-13 academic year shows that Macalester is performing well financially. In 2009, projections predicted a budget shortfall of approximately $5 million by 2014. Current projections, however, show income and expenses to be in line for 2013. Increases in tuition and improved financial markets have eliminated the projected deficit. Increased returns from the endowment made up most of the shortfall. According to Vice President of Administration and Finance David Wheaton, projections for the size of the endowment size bottomed out at $25 million in 2009. Today, the school’s endowment sits at $31 million and is projected to remain relatively flat over the next two years. Increases in tuition dollars have also contributed to a healthy revenue stream. Wheaton announced in a presentation that next year’s tuition increase is the lowest in almost four decades. The four percent increase (down from 4.9 percent last year), places tuition at $43,472 for next year, according to the Macalester Admissions website. Using these same figures, room and board costs will rise by 3.5 percent next year, totaling $10,066. Tuition revenue is also determined by the size of the student body; the new budget plan assumes that Macalester will have a student body size of 1,900. This figure raises the target student body size by about 50 students from the stated maximum in recent years. In November 2011 The Mac Weekly reported that the Resources and Planning Committee recommended targeting a student body size of around 1950 students as a way to cope with slow revenue growth. The new target student body size is still lower than the current student body size of 1,987 students. Wheaton said the administration has carefully considered the impact of student body size on the student experience. “I would say two things are a little different,” Wheaton said. “One is we have more students who study away… The second thing is that I think now we’ve gone through this experience of having a bigger student body, we know what works and what doesn’t work. We’ve in a sense sort of run a real time experiment. Not by design, but we’ve found that out where the issues are, like with Café Mac. So that told us there are places we’d probably not want to go or stay. But we also found that in the past we thought 1850 would be as big as we could handle, but we think 1900 is also comfortable and still meets all of the needs.” The current size of the student body, and particularly that of the class of 2013, provided an unexpected tuition bump that has helped Macalester ride out the recession. The budget committee has anticipated an interruption income growth, coinciding with the graduation of this large class. Wheaton said that a student body of 1,900 is only about two percent bigger than previous sizes. This increase also comes with a five percent increase in the financial aid budget, meaning that an increase in class size does not coincide with an increase in the number of students paying full tuition. However, Wheaton cautioned the school against becoming too comfortable with a particular student body size and that particular revenue stream. “I think we’re comfortable with being at 1,900,” he said. “But we’ll see over a few years how it plays out.” refresh –>